bank rates

And The Baddest Boy Of Banking Is…

Imagine a world in which the man who turned ridiculous bank fees into an art form later renounced such money-grabbing tactics.He and his minions are responsible for the abandonment of CDs by savers.

His group largely guided the back-breaking decline of CD yields.

Since August 2008, the average rate on a 5-year CD fell from 3.13% APY to 1.05% APY. The average yield on a 3-year CD has fallen from 2.57% APY to 0.65% APY.

And he’s made sure the situation for savers isn’t going to improve anytime soon.

Yes, Bankaholic’s Baddest Boy of Banking is Ben Bernanke.

Given the historic nature of what’s happened to certificates of deposit in the last few years, it’s really no surprise the president of the Federal Reserve easily won our poll last week asking readers who they think is the baddest boy of banking.

He beat out the likes of Jamie Dimon, Lloyd Blankfein and other megabank titans for this ominous award.

In our view, it’s not just what Bernanke and the Fed’s rate-setting committee have done to interest rates that puts him ahead of all the other financial wizards in the race to treat savers the worst; it’s the fact he consciously and continually does it.

Bernanke repeatedly has said that people who believe in low-risk investing must suffer to prop up riskier investments in a weak economy.

In March, he defended his board’s actions, saying the low-interest-rate environment could actually benefit savers:

“Remember,” Bernanke said, “people also own equities, they own money market funds, they own mutual funds. They have 401(k)s and a variety of things.

“Those assets are assets whose returns depend very much on how strong the economy is. And so, in trying to strengthen the economy, we are actually helping savers by making the returns higher as we can see in what’s happened in the stock market, for example.”

I know some seniors who have fled equities that would disagree.

Indeed, Bernanke scores low in nationwide polls of average Americans, yet typically enjoys the support of Wall Street investors.

It’s a good indicator of who he really works for.

As we noted in the introduction of our poll, it isn’t too late for any of these bad boy bankers to change their ways.

That doesn’t mean we hold out much hope. At least until 2014, when Bernanke’s term is set to expire.

GOP presidential candidate Mitt Romney has already indicated he wouldn’t reappoint Bernanke. No word yet from President Obama’s camp.

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Comments (1)
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One Existing Comment
  1. Ivan P. said:
    on August 13th at 09:24 pm

    Step down Bernake!