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Personal Finance Blog By MoneyRates - August 2007

10-year Treasury Yield and Odds of Recession

August 30, 2007

By MoneyRates Team | Money Rates Columnist

The chart of the 10-year U.S. Treasury Bond below shows that the yield has not broken below 4.40% for over one year.



Market watchers now believe that the 4.40% could be broken as the economy is showing inflation under control and longer term interest rates seem less likely to increase significantly. The ongoing flight-to-quality to short-term U.S. Treasuries has increased the spread between 90-day T-Bill yield and 10-year Treasury Bond yields back up to 75 basis points after narrowing to less than 10 basis points. The larger spread is thought to lower the odds of the U.S. economy entering a recession as witnessed by the model that the Federal Reserve Board's Jonathan Wright in The Yield Curve and Predicting Recessions developed. In Wright's model the chance of a recession has decreased from 32% to 13% based solely on the levels of the Treasury yields and the Federal Funds rate. Whether or not the spread between the shorter term and longer term Treasuries is a temporary and artificial effect of the mass dumping of mortgage-related securities, savings investors can find more incentive to purchase longer-term U.S. Treasuries and take advantage of the widened spread in yield.

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E-Loan Auto Loan Rates

August 29, 2007

By MoneyRates Team | Money Rates Columnist

Consumers have been relunctant to do the same rate shopping for auto loans that they do with mortgages, savings accounts, and credit cards. Frequently, the financing offered by the dealer is sold with the automobile with very little comparisions. In the day and age of 0.00% financing many of the deals offered by the dealer where in fact outstanding, but those deals are few and far between. The national average on a 4-year auto loan is close to 7.00% and used car loan rates are even higher. One lender who is standing above the rest with a wide menu of auto loans and refinancing terms is E-Loan. Here are the current rates listed by E-Loan.

New Vehicle

3-years or less: 5.99%
37-month to 5-years: 6.25%
61-month to 6-years: 6.89%

Used Vehicle (Dealer)

3-years or less: 6.45%
37-month to 5-years: 6.85%
61-month to 6-years: 7.49%

Private Party Vehicle

3-years or less: 8.85%
37-month to 5-years: 9.15%
61-month to 6-years: 9.95%

Refinance

All terms: 7.20%

Lease Buyout

3-years or less: 8.35%
37-month to 5-years: 8.95%
61-month to 6-years: 9.55%

Posted in: Loans & lending

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Pulaski Bank VISA/Mastercard with 7.99% APR

August 28, 2007

By MoneyRates Team | Money Rates Columnist

The Pulaski Bank Visa® / MasterCard®, issued by Pulaski Bank, is designed for those with an average credit history who are looking for a very low cost credit card.

Pulaski Bank Visa® / MasterCard®

The best feature of this credit card is the very low fixed interest rate of 7.99% (for purchases and cash advances); it provides a very low cost option to those who plan to carry a revolving balance. There is also a very attractive introductory rate for six months on balance transfers. In addition, the annual fee of $35 is very reasonable for such a low interest rate credit card.

However, aside from the very low interest rate for all transactions, cardholders should not expect any extraordinary benefits or services offered by the card.

Those who plan to carry a balance (due to the low interest rate offered), do not mind paying an annual fee of $35, and do not care for any extraordinary benefits or services will benefit most from what the Pulaski Bank Visa® / MasterCard® has to offer.
Review Date: 7/26/2007

Most Attractive Feature(s): Very low APR; 0% introductory rate for six months on balance transfers.
Least Attractive Feature(s): Annual fee.

Additional Perks
Various Internet account related services.
Emergency cash replacement.
Emergency card replacement.
Lost and stolen card reporting.
No liability for unauthorized transactions.

Apply online

Posted in: Miscellaneous

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Stock-Market Linked CDs

August 28, 2007

By MoneyRates Team | Money Rates Columnist



Salem Five Bank Stock Index Retirement CD

The three-year Stock Index Retirement CD will earn interest based on 65% of the Standard & Poor's 500 Index® gain and the five-year Stock Index Retirement CD will earn interest based on 70% of the Standard & Poor's 500 Index® gain, with no rate cap for an unlimited upside. In addition, a 100% return of principal is guaranteed. Minimum investment $5,000. Maximum investment $1,000,000.

For more information call 978-720-5255 or visit salemfive.com.

Principal FDIC-insured up to $100,000 per depositor.

State Farm Bank Market Rate Certificate of Deposit

Market Rate Certificate of Deposit (CD)Features:

-Minimum opening deposit required is $500
-Available only in a 5-year term
-Principal and any interest earned at the end of the term is FDIC insured up to $100,000 per depositor.
-Potential for returns typically associated with a stock market investment.
-Does not renew automatically at maturity
-No early withdrawal

Market Rate Certificate of Deposit (CD) Interest:

-Rate of return is not fixed and is determined at CD maturity date
-Rate of return tied to the S&P 500® Index
-Earnings, if any, are paid at maturity
-No guaranteed interest rate.

Call State Farm Bank toll-free at 1-877-SF4-BANK (1-877-734-2265) or visit www.statefarmbank.com for more information.

Principal FDIC-insured up to $100,000 per depositor

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UniBank 90-day CD 5.65% APY

August 27, 2007

By MoneyRates Team | Money Rates Columnist

UniBank is a new bank (chartered in November 2006) based out of the Pacific Northwest which has jumped into the national market with the following CD rates:

3 Months Fixed CD - 5.51% rate 5.65% APY

6 Months Fixed CD - 5.22% rate 5.35% APY

12 Months Fixed CD - 5.22% rate 5.35% APY

18 Months Fixed CD - 5.00% rate 5.12% APY

24 Months Fixed CD - 5.00% rate 5.12% APY

36 Months Fixed CD - 5.18% rate 5.30% APY

48 Months Fixed CD - 5.18% rate 5.30% APY

60 Months Fixed CD - 5.18% rate 5.30% APY

Obviously the 90-day CD rate is attractive, but even the longer term rates are well above the national rate averages. UniBank's stock (USD) is down less than 10% since its 52-week high in July, an indication that their mortgage lending business is viewed as stable. Investors in CDs issued by UniBank are FDIC-insured up to $100,000 per depositor.

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