bank rates

Have CD (Certificate of Deposit) Rates Bottomed?

Bernanke and the rest of the Federal Reserve are expected to lower interest rates by 25 basis points (0.25%) this Wednesday to 2.00%.

Most experts speculate that after this Wednesday’s cut, Bernanke will keep rates unchanged for the next few months.

This is a tough situation for those looking to open a certificate of deposit account. Rates are so low right now that it is unfavorable to lock these rates in for the long term. Instead, a better choice may be to stash money away in liquid money market & savings accounts, which currently average better returns (APY) than CDs (according to Bankrate national data).

Regardless of whether you open a CD or a money market, the current unfavorable economy makes it very difficult to beat inflation. Low interest rates, record oil prices (almost $120 / barrel), and food shortages are going to make it more expensive for you to maintain your standard of living.

Are you interested in how the Federal Reserve works? Watch the video below to learn!

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Comments (18)
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18 Existing Comments
  1. Ganesh said:
    on April 29th at 02:04 pm

    Sigh.. what about bonds, can you write about them ,esp. I savings bond?
    Is it a good place to lock some money?


  2. Bob said:
    on May 3rd at 02:12 pm

    Why people sit around like the over fed sheep they are while Paulson and Bernanke do for America what Bush did for Iraq is beyond me. America and it’s citizens are truly a lost cause.

  3. Peter said:
    on May 3rd at 06:19 pm

    Thanks for your valuable insight, Bob. What better country would you suggest we all move to?

  4. John said:
    on May 4th at 04:59 pm

    America is slowly rotting from within. In 50 years, at most, the US will just be another country with a lot of domestic problems. Last one out, turn off the lights.

  5. Shirley said:
    on May 5th at 01:25 am

    I believe every adult in our country should watch this video. It is another wake up call that demonstrates the need for change in our government. We need strong, moral leadership in Washington, and we need it right now. Voting in this year’s election should not be an opportunity; it should be a requirement!

  6. Bob said:
    on May 5th at 02:37 pm

    Hi Peter….how about Singapore, how about Switzerland, how about Ireland, Brazil, Thailand or New Zealand. America, one nation under surveillance with urine tests and wiretaps for all. What a shame.

  7. Bloch said:
    on May 5th at 11:23 pm

    I’ve been to every country Bob mentions–in many cases, several times. In order:

    Singapore – well-run police state. If Bob’s worried about “urine tests and wiretaps” in America, he’s gonna love living in a place where you can be caned for chewing gum and executed for smoking pot.

    Switzerland – pretty country and reasonably well-run, with a strong currency and tolerable political freedoms. Still a relatively socialist place, with a massive welfare infrastructure, but I’d agree that it’s a decent alternative. Except that you can’t move there. Switzerland has one of the world’s most restrictive immigration laws, and these laws differ by Canton (read: state). In many Cantons, you actually need to be voted in by a majority of the citizenry. I know that sounds absurd, but I dated a Swiss girl for about a year and spent a lot of time in Zurich and elsewhere. So far as I know, that’s a true statement. Also, it’s cold and crappy in the wintertime. But then again, so is Chicago.

    Ireland and New Zealand – good tax structures, good English skills, but really client states and backwaters, albeit pleasant ones. Bob’s not gonna get rich, but if he can find the right babe to marry these also are legitimate options. I don’t think either are anywhere near preferable to the United States, but de gustibus . . . .

    Brazil – I don’t know anything about Bob other than his name. But I am nevertheless quite confident that Bob has never been to Brazil. Brazil’s good fun. The women are spectacular. The weather’s pretty good most of the time. But every legitimate city is surrounded by a warren of illegal homes that have, over the last 50 years, become entire self-governing (read: anarchic) illegal cities (called favelas). Brazil is still basically a hectic Third World country. Great place to go if you’ve just killed your wife; not so hot if you’re looking for freedom and democracy.

    Thailand – If you’re into transvestite hookers, great. Thailand’s disgusting, poorly governed (you know they still have a king, right?), prone to military adventurism, and full of Third World tropical diseases. Nor is it particularly free.

    The idea that Bob would consider both Singapore and Thailand preferable alternatives to the United States is pretty silly, in the final analysis.

  8. Bob said:
    on May 6th at 10:25 am

    Bloch…you sound like you’ve bought every dis-information campaign and bit of media manipulation for the last ten years. The characterizations of the countries was entertaining but in fact what do you call America? A BADLY RUN, blood thirsty, $10 trillion in debt Police State? Where 2 out of every 10 citizens are delusional right wing Christians. 3 out of 10 are alcoholics. 4 out of 10 are on anti-depressants and 6 out of 10 are either functional illiterates or so dumbed downed my Media Monotony that they can’t tell the difference between a political leader and a can of dog food.
    I’ve tried all the above and everyone of them is preferable to the US. But my real disagreement is that I think the women of Thailand are far superior to those of Brazil, the occasional Ladyboy excepted.

  9. Bloch & friends said:
    on May 6th at 07:24 pm

    Wow. That is very surprising, and I agree with the skew (I think I own
    4 rifles and a shotgun, not counting a couple of air rifles) caused by
    individuals owning multiple guns. I think very few people who do own
    guns in the US own only one.

    —–Original Message—–

    To my surprise, we’re both wrong. The United States is the world’s most
    heavily-armed nation.
    S&feedName=topNews&rpc=22&sp=true .

    On the other hand, there’s a significant skew here. While in Israel
    every able-bodied citizen must own a firearm, and in Switzerland the
    same is true for every able-bodied male, in the U.S. you get situations
    where one person owns a dozen firearms (I own 9), which skews the
    average. I’d still think that both Israel and Switzerland have a
    broader distribution of firearms, even if the per capita numbers are

    —–Original Message—–

    I think I am right about Switzerland being the most heavily armed
    citizenry. Wikipedia? Surely, a bunch of Nazis fled to Argentina as
    well as Brazil. I think Brazil may in fact be the 800 lb gorilla
    lurking in the wings of the world economy, if it ever awakens. Huge
    natural resources with only a moderately sized population. In contrast
    to India and China.

    —–Original Message—–

    Switzerland: maybe, but I think not. I’d probably take the Israelis

    Brazil: interesting point, and you’re not the first person I’ve heard
    make that comment (though I more commonly have heard that the Nazis fled
    to Argentina than Brazil). I have to say, though, that I saw absolutely
    no German influence–in food, women, or (understatement)
    efficiency–during my 3 weeks in Rio, Bahia de Salvador, and environs.
    That’s not to say it isn’t there–Brazil’s a big country–but it was
    curiously absent from the places I visited.

    By contrast, Suriname and Guyana are crawling with blonde-haired,
    blue-eyed, inbred Mennonites.


    Switzerland = most heavily armed citizenry in the world.

    Brazil = so heavily Catholic it is frightening and repressed, its
    outward-appearing rollicking reputation notwithstanding. There is a
    reason the Nazis fled there after WWII.

  10. Bloch & friends said:
    on May 6th at 08:12 pm

    Franklin Pearce, When the Rivers Run Dry. Daunting. Not gonna be my problem, but yours and my kids. Desal is not a solution – too slow, too expensive, too energy inefficient – and creates a huge waste disposal problem in its own right. The salt content of the Colorado River from start to finish goes up 700X. What water there is by the end is unusable, and ruins fields more than grows crops. This book (which is not a sensationalist piece, but a pretty objective analysis) will leave a thoughtful person puckered.


    I agree, but the guy’s too far gone to be worth engaging.

    In re: water, very intersting observation. I can’t say I know too much about China or India’s water situation, save to say that their rivers look filthy and smell like raw sewage.

    How’s desalinization technology coming along?


    Dude, I say offer him free legal assistance to make sure his passport is up to date, get him a visa to his country of choice, we will all chip in on a one way ticket (economy – he will learn to live without luxury and may as well start now), and then form an internet betting pool to see how long he lasts before he comes crawling back. I’m no patriot, and recognize more flaws with what we have than most people, but this guy is not engaging in a dialogue – he is teaching diatribe, which is equally as dangerous as the first three (out of four) problems he identifies, combined.

    Btw: further to our discussion this morning, I think an important limiting force on India and China in the next 20 years will be fresh water. They are running out. Brazil has lots of that. Fresh water will be the oil of the next 50 years.



    I think I’ll let Bob have the last word on that, thanks.

  11. Anonymous said:
    on May 6th at 08:49 pm

    I’ve seen this before. It scares the hell out of me. Why on earth do we borrow money from a privately owned bank? It’s absurd.

  12. Bob said:
    on May 7th at 01:06 am

    If you don’t mind a serious reply. It confounds and scares me that Americans sit passively by while a political system that has become so corrupt and deadly to the continued existence of the country merrily goes on its way. From Cunningham to Cheney from Katrina to the national deficit, from the Dept of Justice to the EPA, from the Dept of Treasury to the FCC, the government is riddled with delusional right wing Christian operatives and industry lobbyists.
    America the number one arms seller in world, the largest prison population in the world, the largest polluter in the world, the number one debtor nation in the world. Is this our legacy? The Banana Republic of America, where every government failure is justification for yet another onslaught on the Constitution and peoples freedom?

    I have lived in all the places that originally started this discussion. I feel safer and more personally free in all of these places then in the US. I wouldn’t have said that 10 or 15 years ago. That America killed 3.4 million Vietnamese, burning the skin off of their children with Napalm for no reason, could be deluded by George Bush and the corporately controlled media companies into killing 600,000 Iraqis a generation later is more stupidity then I can handle in a country.

    I live in Asia now and moving my investments into the Pacific Rim countries especially China and Australia as quickly as possible. I’ve given up on America. And just as we were all stunned to watch the seemingly overnight collapse of the Soviet Empire, I’m certain the US is not far behind.

    Thai women, Brazilian Ayuawasca, Australian interest rates and Chinese RMB. That gentleman is the future (or the present….get out while you can!).

  13. Peter said:
    on May 7th at 10:23 am

    Bob, I guess you would prefer that we buy your own dis-information campaign instead? You’re right. The media has tricked us all into loving the country. Maybe one day we’ll see the light like you. Until then, enjoy your Asian utopia. Your fascinating insight and statistics on the state of the U.S. will probably serve you much better there.

  14. Bob said:
    on May 7th at 11:00 am

    Peter…really, what I’m trying to understand is how intelligent people can see a situation so differently. What comes to mind are the Jews in Germany or the Tutsi in Rwanda. Some people anticipated what was going to happen and lived to tell about it, but millions couldn’t see or refused to see what was coming and paid the price. I’m trying to apply that same lesson to my financial and other survival….but am unclear about how to interpret what I’m really seeing. My only desire is trying to understand truth of a situation so I can make rational choices

  15. Kaz said:
    on May 7th at 03:08 pm

    Bob, what’s so great about Thai women? please explain…

  16. Curls said:
    on May 25th at 06:01 am

    Bob – you could use some of those wonderful antidepressants you mentioned. Then maybe you could see the good as well as the bad. (From someone’s who not on anti-depressants and can still smile here in that terrible place called the USA.)

    You’re comments aren’t realistic. You’re stats are overblown (did you get them from the media who’s known for that?) As a Jew there’s only two places I’d like to live in the world – and this one is very safe. I can’t say that for so many other places. There’s a reason so many people apply to come here every year. So maybe with those anti-depressants discovered in this country, you’ll be happier know why.

  17. Curls said:
    on May 25th at 06:03 am

    you’ll be happier and know why.

    Seriously, you sound depressed.

  18. Martin S. said:
    on July 18th at 04:36 pm

    Please tell Bob to refrain from the impulse to chatter like a moron. Bob also has poor spelling and grammar. I suspect his many other attributes are likewise. I am an optimist, and I find that this is a good buying opportunity in the stock market, and I am confident that while the Bobs of the world rant, I, along with other smart investors, shall be counting profits! Seize the day, my friends!