Best CD, MM Rates & Bank Special Deals Thread 2022 - Please post updates here

Status
Not open for further replies.
Jeffrey Gundlach say they should do 0 bp, the effects of the increases they have already done have yet to even work their way into the system, it takes about 9 months. The fear is the Fed is going to overdo it and create a serious recession. He said at the most 25 bp but figures the Fed will do 75 bp. Most are saying 75 bp but there are few that say 1% and I can't recall who they are. I think 75 bp will be the number but we'll see.
 
Depends if you buy into the new artificially low rates of the past 10 years. Or the normal rates of the past 3000 years. The fed is so far behind the curve, what they do now will have little effect. 8% inflation. 2.5% fed rate, No Bueno. Its just math.
 
Graybeard said:
Jeffrey Gundlach say they should do 0 bp, the effects of the increases they have already done have yet to even work their way into the system, it takes about 9 months. The fear is the Fed is going to overdo it and create a serious recession. He said at the most 25 bp but figures the Fed will do 75 bp. Most are saying 75 bp but there are few that say 1% and I can't recall who they are. I think 75 bp will be the number but we'll see.
Click to expand...
And he is right. I remember one of my college finance profs making the same point, circa 1979 or so.

Of course, in this case, that rates have so far to go and other inputs such as excess money supply and excess fiscal spending are also pushing prices up, I think continuing to raise makes sense. But I think it will be .75. The CPI was pretty much a non-event and they follow the PCE deflator not the CPI so much.

And the psychology of the markets knowing that the Fed is continuing to hit the brakes is helpful.
 
Meanwhile in the real economy, things are decelerating quickly. Look at $FDX this morning Federal Express) which is down 21% in pre-market due to a really, really crappy earnings warning.

Atlanta GDPNow forecast for Q3 is also decelerating, latest is + 0.5% as of September 15th.
gdpnow-forecast-evolution.gif


While I think the trajectory of interest rates is still up (especially after the latest CPI print and how wide-spread inflation has gotten to other than gasoline prices), these kinds of economic news/impact should reduce the interest rate growth path. But who knows, especially since government needs for borrowings doesn't seem to be waning. (I'm being nice here.)

In the meantime, I'm buying more 6-month treasuries on Monday.
 
As of today, Schwab is offering 4% on 1, 3 and 5 CD's and 4.5% on 10 yr.
 
Ally 18 month 3%

I guess it seems worthy only because for so long, bank rates have been weak.

I wonder iff - by bumping the rate now - they want to get some people in BEFORE the rate has to go up another .75% - or more.
 
^^^^

Probably... But I bought some too as part of a ladder...
 
This may have been discussed before in this thread or in another, if so, sorry about that. But, now that CD's are getting hot, I thought I'd ask again. When you are looking to buy CD's, does it matter to you what bank you buy them from through your brokerage?

I've been watching the available CD's from Schwab for months now and I have bought some smaller ones. The offerings change regularly and I've never heard of ~80% of the banks that are offering the CD's. But all are FDIC insured. Does it matter "to you" buying a CD, through your broker from a bank that you have never heard of "or" do you stay with the big named banks? Of course as long as you stay below the 250k FDIC limit per bank. (Note, sometimes the unknown named banks have slightly better rates, but not really that much more)

"Asking for a friend" (me) :) who is about to buy a bunch of non-callable CD's of, various denominations, rates and maturities.
 
Last edited:
frank said:
are those callable? do you have to be a member of schwab to buy?
Click to expand...
No, not callable, and yes if you want to buy through Schwab, you'd need an account. Maybe you could buy direct from the bank(s) if you want to deal with each bank...
 
Last edited:
Car-Guy said:
No, not callable, and yes if you want to buy through Schwab, you'd need an account. Maybe you could buy direct from the bank(s) if you want to deal with each bank...
Click to expand...

Keep in mind that if you go directly to the bank, you likely won’t get the same rate that you can get on the brokered CDs.

Also, you don’t have to use Schwab. Any broker is fine. I use Vanguard myself.
 
disneysteve said:
Keep in mind that if you go directly to the bank, you likely won’t get the same rate that you can get on the brokered CDs.
Click to expand...
Yep, I checked out a few directly through the banks websites. In all cases "that I checked" their rates were actually lower when going direct. :confused:
 
Last edited:
Car-Guy said:
Yep, I checked out a few directly through the banks websites. In all cases "that I checked" their rates were actually lower when going direct.:confused:
Click to expand...

Exactly. It’s worth opening a brokerage account if you don’t have one to gain access to the better rates. Then you can also buy Treasury bills too if you wish. And all of your money is in one place instead of having to open and keep track of multiple bank accounts.
 
disneysteve said:
Exactly. It’s worth opening a brokerage account if you don’t have one to gain access to the better rates.
Click to expand...
That's a change from a decade+ ago... The last time I bought CD's, (more than a decade ago) I found that I could get slightly better rates going directly to the banks. If buying from Schwab, they made their money by "skimming" 1 or 2 tenths off the top... Doesn't seem to be working that way anymore. No doubt they are still making money off brokering the CD's, you just can't see it as easily as you could in the past. :)

To me, it's would still be worth 1 or 2 tenths to avoid the hassle of dealing with all the different banks directly, so now it's a win win from my POV.
 
Last edited:
disneysteve said:
No. It makes no difference to me as long as they are FDIC insured.
Click to expand...

While it is true that you will get your money back if the institution fails (if FDIC insured and you are under the FDIC limits), there are factors to consider. When the FDIC does the takeover, there are two types:
1. Purchase and Assumption Transaction - this is the better scenario, as the healthy (buying) bank takes over the accounts and you have access to the funds.
2. Deposit Payoff - this is a less desirable outcome. In this case, the FDIC wasn't able to find another bank to takeover the failed banks depositors. In this case, the FDIC will pay (by check) the depositor - "usually" within a few days of the bank failure.

A couple of things to note about "usually" - the law requires the FDIC to make good "as soon as possible" but the FDIC can sometimes require supplemental documentation regarding the account.

This (supplemental doc) might be required if the deposit was made via a fiduciary. [I don't know if a brokerage account would be in this category.]

Also note:
* Interest accrual ceases when the bank fails.
* I also *think* I remember (for whatever that is worth) that CD's may be broken (i.e. not honored going forward) by the acquirer or if the FDIC sends a check to make good on the deposits).

In good times, the above might not be very important. But in not so good times?
 
Status
Not open for further replies.

Similar threads

Gumby
  • Sticky
Best CD, MM Rates & Bank Special Deals Thread 2024 - Please post updates here
7 8 9
Replies
217
Views
28K
teej1985
T
imbatman
Corporate and Agency GSE Bond DEALS and NEW ISSUES
17 18 19
Replies
454
Views
51K
jldavid47
jldavid47
Earl E Retyre
I am a secondary market brokered CD convert
2
Replies
35
Views
2K
hpnutty
hpnutty
Janet H
Forum Update - We're back! Ask your questions here.
8 9 10
Replies
249
Views
6K
emmaswan
E
S
Problems with Fidelity Bond depth of book
Replies
3
Views
503
foxfirev5
foxfirev5

Latest posts

Back
Top Bottom