http://www.thesunsfinancialdiary.com/personal-finance/ing-direct-lowered-interest-rates/ Fri, 03 Feb 2012 17:42:24 +0000 hourly 1 http://wordpress.org/?v=3.3.1 http://www.thesunsfinancialdiary.com/personal-finance/ing-direct-lowered-interest-rates/#comment-23841 Sun Wed, 26 Sep 2007 01:51:03 +0000 http://www.thesunsfinancialdiary.com/personal-finance/banking/ing-direct-lowered-interest-rates/#comment-23841 sl: What I think is that when we deposit money in the bank, we are lending them the money at the interest rate they pay us. If they can borrow the money at 4.75% from the Fed, there's no reason for them to pay us 5.30% theoretically. So as the Fed funds rate is lowered, the banks could lower the interest rates they pay us as well, though may not at the same scale. sl: What I think is that when we deposit money in the bank, we are lending them the money at the interest rate they pay us. If they can borrow the money at 4.75% from the Fed, there’s no reason for them to pay us 5.30% theoretically. So as the Fed funds rate is lowered, the banks could lower the interest rates they pay us as
well, though may not at the same scale.

]]> http://www.thesunsfinancialdiary.com/personal-finance/ing-direct-lowered-interest-rates/#comment-23587 sl Sun, 23 Sep 2007 12:51:01 +0000 http://www.thesunsfinancialdiary.com/personal-finance/banking/ing-direct-lowered-interest-rates/#comment-23587 The drop appears illogical. The Feds drop the rate for the banks to borrow. This should boost the rate they offer for savings since their profit margin has increased. The banks are in the business of making money not teaching or following economic theory. The drop appears illogical. The Feds drop the rate for the banks to borrow. This should boost the rate they offer for savings since their profit margin has increased. The banks are in the business of making money not teaching or following economic theory.

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