Do You Deserve More For Your CD?
February 20, 2009
Is there a way that banks and Wall Street firms could be more profitable? Say profitable enough to pay more interest on certificates of deposit, increase stock values and not require federal assistance?
Here's a clue: Between 2004 and 2008 financial firms headquartered in New York City paid out bonuses worth $129.7 billion.
Mind you, this money was paid out for the short-term thinking and results which are now costing the federal government -- meaning you and me -- billions and trillions of dollars. No kidding, our potential costs under various bailout programs could amount to $9.7 trillion according to Bloomberg News.
What have the billions paid out on Wall Street bought us? For instance, imagine if we awarded $1 billion to the first medical researchers who found a cure for diabetes. While $1 billion is a lot of money, the reduced costs to our healthcare system would be many times larger. More importantly, a lot of people would lead far better lives.
The new national debate is going to concern value and what things are worth. How much should we pay for money placed in money market account or a CD, what's the right yield and rate? It's time that shareholders, depositors and investors reaped the rewards which flow from their assets and hard work -- and not disproportionately the folks who manage those assets.
For more information, see:
New York City Securities Industry Bonuses, Jan 28, 2009
U.S. Taxpayers Risk $9.7 Trillion on Bailout Programs, Bloomberg News, February 9, 2009