clock menu more-arrow no yes

Filed under:

Patriotism, bitcoins, inflation and why I can’t get a decent return on an investment

Nobody on those TV shows ever mentions that banks are offering an interest rate of just .01% on CDs and what that means for workers trying to save a buck.

“Millions of Americans remain out of work,” writes Phil Kadner, “but this apparently has a positive impact on the stock market, which keeps going up.”
AP Photos

So, my bank offered me a “special” CD rate of .05% for five months.

That is not 5%. That is not even 1%.

What if I were to deposit a huge amount of money?

“Doesn’t matter,” said the woman on the other end of the phone. That is the best rate.

Suppose I wanted a 12-month CD so your bank could invest my money for a year?

“Our 12-month CD rate is currently .01 percent.”

I mention this because I recently was watching some financial shows on TV where the experts fretted about inflation. Inflation would cause interest rates to soar, the experts said. And that would be a very bad thing.

Cursing, I changed the channel and a TV reporter holding the handle of a shopping cart was doing a report on rising prices at the local grocery store.

Prices on just about everything are going up, he said, pointing to numerous items in his cart. There are fears this is going to lead to inflation, he said, which could be very bad for the economy. He then interviewed several ordinary people about the higher prices they had paid for bread, eggs, chicken and coffee in the last few days due to the surging price of energy.

That in turn, the experts said, is being caused in part by a cyberattack on Colonial Pipeline, one of the largest suppliers of gasoline and other fuels in the country.

A group of outlaw hackers called DarkSide, apparently living in Russia, had broken into Colonial’s computer system, installed malware, and was seeking a ransom. This was a terrible thing for our entire country, the experts said, and part of a continuing series of hacks on major companies and small businesses.

Nobody mentioned that banks are offering .01% interest rates on CDs and what this means for workers trying to save a buck. In fact, I don’t recall anyone sounding particularly concerned about this ever, although reporters on TV have talked excitedly about the low mortgage rates available to people throughout the country.

Great deals can be had for people trying to buy a home.

I occasionally try to save some money by checking out the rates of certificates of deposits because the federal government guarantees such investments.

Should the stock market collapse, a small investor’s funds are protected, and he’ll still be able to afford the rising price of eggs, bread, milk, and coffee.

As I was writing this column on Monday, I received a notification that the Dow Jones had achieved yet another record high (it seems to do this on a weekly basis), but that Nasdaq and the S&P 500 had fallen slightly.

The cyberattack on Colonial was blamed for Nasdaq’s dip, but apparently had no negative impact on the Dow Jones, which no one bothered to explain.

I have heard that millions of Americans remain out of work and that people need assistance to keep their homes and make their mortgage payments, but this apparently has a positive impact on the stock market, which has been going up and up and up.

The Federal Reserve Bank has been cutting interest rates to save us all from inflation, which saves my bank from paying higher interest rates on CDs. If the bank were to pay me a full 1% on a 12-month CD, that apparently would jeopardize the national economy.

I am a patriotic American and happy to do my part.

I heard the guy who builds Tesla cars and spaceships is investing billions of dollars in bitcoin, which is a threat to the banking world. Those of us with CDs who expect no return on our money could teach him a thing or two about patriotism.

philkadner@gmail.com

Send letters to letters@suntimes.com.