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FDIC ins goes to $250k permanently
Old 07-21-2010, 03:19 PM   #1
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FDIC ins goes to $250k permanently

FDIC: Press Releases - PR-161-2010 7/21/2010


"On July 21, 2010, President Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which, in part, permanently raises the current standard maximum deposit insurance amount to $250,000. The standard maximum insurance amount of $100,000 had been temporarily raised to $250,000 until December 31, 2013. The FDIC insurance coverage limit applies per depositor, per insured depository institution for each account ownership category".
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Old 07-21-2010, 03:40 PM   #2
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Awesome, now folks can put even more into CD's at 1% interest...........
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Old 07-21-2010, 03:49 PM   #3
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Awesome, now folks can put even more into CD's at 1% interest...........
Hey, don't knock a positive return I do think this is a good deal, allowing me to reconsolidate some of the funds that I spread out over several institutions.
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Old 07-21-2010, 03:55 PM   #4
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psst - Costco Capital One online savings account at 1.39%. Because that extra .39% is gonna make all the difference....
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Old 07-21-2010, 06:05 PM   #5
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Awesome, now folks can put even more into CD's at 1% interest...........
You can still find 3% 5-yr CD rates. That is nearly double 5-yr treasuries, for basically the same credit risk. That sounds like free money to me (oh, and some of the CDs have very low cost put options too). Looks like Ally Bank is gonna get some more of my money.
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Old 07-21-2010, 06:12 PM   #6
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I think Discover has 3% for 5-yr CD's and 3.5% for 10-yr...
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Old 07-21-2010, 06:14 PM   #7
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There was no way this wasn't going to happen. The risk of people rushing to pull out deposits between $100K and $250K was almost certainly never considered to be allowed.
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Old 07-21-2010, 06:20 PM   #8
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Is it safe to assume the credit unions will follow suit?
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Old 07-21-2010, 06:24 PM   #9
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I think Discover has 3% for 5-yr CD's and 3.5% for 10-yr...
Any idea what their early withdrawal penalty is? I think I looked at them a decided their penalty was too high, but if it's 90 days interest, or something like that, I'd hit that 3.5% 10-yr.
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Old 07-21-2010, 06:36 PM   #10
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Any idea what their early withdrawal penalty is? I think I looked at them a decided their penalty was too high, but if it's 90 days interest, or something like that, I'd hit that 3.5% 10-yr.
It's 9 months interest for terms beyond 5 years:

Certificates of Deposit : Discover Bank CD FAQ's
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Old 07-21-2010, 07:48 PM   #11
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Is it safe to assume the credit unions will follow suit?
Steve
I hope so. PenFed will be getting more of my money if it does. Damn, wish this had been the case when they were offering 6% just a few years ago.
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Old 07-21-2010, 07:53 PM   #12
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Is it safe to assume the credit unions will follow suit?
Steve
The $250K limit for credit unions is in effect until 2013. I'm guessing NCUA will follow the FDIC quickly. They don't want those deposits flowing out to banks.
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Old 07-21-2010, 10:33 PM   #13
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This is so long over due.

Remember when 401k limits weren't indexed to inflation?

Have they indexed the 250k?
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Old 07-22-2010, 08:14 AM   #14
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I've still got 2.5 years to go on my 4.5% Cd's and then I'm going to be scared of what the interest rates will be. Can't believe they will stay this low that long.
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Old 07-22-2010, 08:46 AM   #15
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You can still find 3% 5-yr CD rates. That is nearly double 5-yr treasuries, for basically the same credit risk. That sounds like free money to me (oh, and some of the CDs have very low cost put options too). Looks like Ally Bank is gonna get some more of my money.
So, you would lock in at 3% for 5 years? Wow..........
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Old 07-22-2010, 08:49 AM   #16
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NCUA has followed suit. Credit union coverage has also been permanently increased to $250K.

National Credit Union Administration (NCUA)
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Old 07-22-2010, 08:53 AM   #17
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So, you would lock in at 3% for 5 years? Wow..........
If today's alternative is 1% and if the early withdrawal interest penalty is low enough that it's worth eating should interest rates spike in that time, why not?
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Old 07-22-2010, 08:56 AM   #18
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If today's alternative is 1% and if the early withdrawal interest penalty is low enough that it's worth eating should interest rates spike in that time, why not?
There are alternatives higher than 1%. Heck, you can get munis that pay 4% tax-free........
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Old 07-22-2010, 11:00 AM   #19
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There are alternatives higher than 1%. Heck, you can get munis that pay 4% tax-free........
Where do you find them? I just did a search on Fidelity and 2.65% was the highest I found for a 5yr muni. That was searching S.E. states. Lead me by the hand.
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Old 07-22-2010, 11:21 AM   #20
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Where do you find them? I just did a search on Fidelity and 2.65% was the highest I found for a 5yr muni. That was searching S.E. states. Lead me by the hand.
They are around. Some you have to pay a premium for, so the yield is lower. I won't buy them over 104 in most cases. However, 4 or even 5% coupons are there.

Fido has a decent bond desk, but they don't have access to everything. I don't know how much inventory Vanguard's bond desk has. I might have access to more stuff because I am an FA..........

I was able to procure $50K of a double tax exempt WI GO bond with a 4.25% coupon at 102 callable in 2015 last week. That piece went really fast..........
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