Forum Thread

Fed hikes interest rate for the first time since 2006. Banks hike prime rate mins afterwards but vow not to up savings interest rates.

ghostofposterspast 8,408 1,525 December 16, 2015 at 11:30 AM in Finance (2)
Deal
Score
0
3,051 Views

Thread Details

Fed hiked the fed rate by a quarter. Wells Fargo hiked it's prime rate within minutes. They also said they would not raise the interest it pays to it's depositers.

23 Comments

1 2

Sign up for a Slickdeals account to remove this ad.

#2
And...?
Reply Helpful Comment? 0 0
Joined Nov 2005
L10: Grand Master
25,030 Posts
3,353 Reputation
Pro
#3
They're just moving it up because it's the best tool they have to fark with the economy. The only choice would be to make it negative like is being done in Europe....
Reply Helpful Comment? 0 0
#4
Quote from Dr. J View Post :
They're just moving it up because it's the best tool they have to fark with the economy. The only choice would be to make it negative like is being done in Europe....
They had a choice to leave it or raise it. I seems like you are just saying words without knowing what they mean...
Reply Helpful Comment? 0 0
Joined Sep 2009
L10: Grand Master
6,213 Posts
542 Reputation
#5
They also said they would not raise the interest it pays to it's depositers.

Of course....
Reply Helpful Comment? 0 0
#6
Quote from zzyzzx View Post :
They also said they would not raise the interest it pays to it's depositers.

Of course....
You do realize there is a lag time, right?
Reply Helpful Comment? 0 0
Joined Sep 2009
L10: Grand Master
6,213 Posts
542 Reputation
#7
Quote from eekthecat View Post :
You do realize there is a lag time, right?
Yes. But was there a lag time when rates dropped?
Reply Helpful Comment? 0 0
#8
Quote from zzyzzx View Post :
Yes. But was there a lag time when rates dropped?
I think you might be dumbing it down a bit too much. I hear ya, but it's not exactly reality to immediately match rates that direction for most institutions. There are way too many other factors playing at the rates.
Reply Helpful Comment? 0 0

Sign up for a Slickdeals account to remove this ad.

#9
It's just like gas prices. There is really Zero lag time when Oil goes up.

But it lags 2-3 weeks if oil drops.
Reply Helpful Comment? 0 0
#10
so for savings account and CDs how soon will your local banks raise the interest rate?
Reply Helpful Comment? 0 0
Joined Nov 2014
L10: Grand Master
8,408 Posts
1,525 Reputation
Original Poster
Pro
#11
Quote from okaythen View Post :
so for savings account and CDs how soon will your local banks raise the interest rate?
Ah.... when they have to. Right now, they don't. Money is a commodity. It's about supply and demand. Right not the banks are oversupplied with money. People who got scared away form the stock market have had their money sitting in their savings account. So there is no reason why any bank needs to raise any interest rate for depositors. They simply don't need the money. Banks only need to raise interest rates for depositors when they need attract money.

Quote from eekthecat View Post :
You do realize there is a lag time, right?
It has nothing to do with lag. Look above for the explanation.
Reply Helpful Comment? 0 0
Last edited by ghostofposterspast December 18, 2015 at 10:02 AM
#12
Quote from ghostofposterspast View Post :
Ah.... when they have to. Right now, they don't. Money is a commodity. It's about supply and demand. Right not the banks are oversupplied with money. People who got scared away form the stock market have had their money sitting in their savings account. So there is no reason why any bank needs to raise any interest rate for depositors. They simply don't need the money. Banks only need to raise interest rates for depositors when they need attract money.



It has nothing to do with lag. Look above for the explanation.
It does to some degree. Doesn't mean that a bank isn't going to milk it but you can't just say because fed rates change that deposit rates immediately change with. That is wholly incorrect.
Reply Helpful Comment? 0 0
#13
Quote from ghostofposterspast View Post :
Ah.... when they have to. Right now, they don't. Money is a commodity. It's about supply and demand. Right not the banks are oversupplied with money. People who got scared away form the stock market have had their money sitting in their savings account. So there is no reason why any bank needs to raise any interest rate for depositors. They simply don't need the money. Banks only need to raise interest rates for depositors when they need attract money.



It has nothing to do with lag. Look above for the explanation.

so the FED raised rate but local banks don't have to raise it for savings/CD if they don't need to? interesting didn't know
Reply Helpful Comment? 0 0
Joined Nov 2014
L10: Grand Master
8,408 Posts
1,525 Reputation
Original Poster
Pro
#14
Quote from okaythen View Post :
so the FED raised rate but local banks don't have to raise it for savings/CD if they don't need to? interesting didn't know
There is no requirement that the banks do anything on any interest rate regardless of what the fed does.
Reply Helpful Comment? 0 0
Joined Nov 2014
L10: Grand Master
8,408 Posts
1,525 Reputation
Original Poster
Pro
#15
Quote from eekthecat View Post :
It does to some degree. Doesn't mean that a bank isn't going to milk it but you can't just say because fed rates change that deposit rates immediately change with. That is wholly incorrect.
When did I say anything of the sort?
Reply Helpful Comment? 0 0
Page 1 of 2
1 2
Join the Conversation
Add a Comment
 
Copyright 1999 - 2016. Slickdeals, LLC. All Rights Reserved. Copyright / Infringement Policy  •  Privacy Policy  •  Terms of Service  •  Acceptable Use Policy (Rules)  •  Interest-Based Ads
Link Copied to Clipboard