Random News: Tax Rebate Check, $900 Gold, and Falling Interest Rates
Politicians in Washington acted pretty quickly this time to hammer out a stimulus package with tax rebates, for both individuals and businesses, as the center piece. According to the tentative deal announced today:
Most individuals who pay income taxes would get $600; working couples would receive $1,200. Workers who make at least $3,000 but don’t pay income taxes would get checks of $300 to $600. People in both groups would get $300 credits for each of their children … Couples with income of more than $174,000 would get nothing, unless they have children.
Well, it’s nice to get some money from Uncle Sam, but don’t expect the check in the mail any time soon. The earliest estimate is some time in May or June.
How would you like to spend the money (isn’t that what they want us to do)?
After surging to an all-time high of $901.90 an ounce on January 14th, gold lost momentum in the following trading sessions as investors took profits off the table. The selling pushed the precious metal down to $879.90/ounce on January 17th. However, the bullion rebounded sharply today, even when the stock market was also in the recovery mode. At the close, spot gold reached a new record at $910.60/ounce.
What’s next for gold? $1,000?
Finally, banks wasted little time to lower their savings account rates following the Fed’s emergency rate cut. Since the current rate cut cycle began in September, ING Direct was usually the first bank to drop its savings rate, but this time E-Trade Financial slashed its savings rate from 5.05% APY to 4.40% just hours after the Fed’s move. Since Tuesday, I got several emails from banks announcing their latest rates, including:
- ING Direct Orange Savings Account: from 4.10% to 3.65% APY
- WT Direct: from 4.90% to 4.30%
- IGoBanking: from 4.90% to 4.50%
And it’s likely even these rates won’t stay for long because the central bank is expected to make another rate reduction in the next week’s policy meeting. In the past, I updated bank savings rates after the Fed’s decisions. I will wait after the meeting on January 30th to see how low the savings rates can go. It’s hard to keep pace with the changes
Maybe it’s time to lock in a high rate CD before it’s too late.
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