SmartyPig, a social networking piggybank is running a small promo on Twitter where you can win one of three $100 gift cards. The contest happens tomorrow, June 12. Here's how it works:

1. Follow SmartyPig on Twitter
2. They’ll ask the $100 question on Thursday, June 12th.
3. Answer the question.
4. Tune in to their Blog to see if you have won.

How are they picking the winner?

Below is what they have to say:

This is how we’ll choose the winners:

1. After 10 minutes, we will be picking 20 random people with a number generator from the pool of correct answers.
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4. We’ll post the process here on our blog, so everyone can see it!

Good luck!

We've talked about it for some time, but the Washington Post has finally gotten with the program. The economic crisis and subsequent bailouts have severely penalized savers and those living on fixed incomes. Bankdeals has pointed out an article by Allen Sloan that puts its finger on the dilemma created by the low rate environment engineered by the Fed.

"This is a quiz. What do the record-high Wall Street bonuses have in common with the record-low yields for savers? Answer: They show yet another way that prudent people, especially those living on fixed incomes, are being cheated by the government's bailout of the imprudent."

The article goes on to discuss how this time, the damage done to savers is greater than in the past. Usually, the Fed lowers short term rates (the Fed Funds Rate) which impacts yields on savings and CD accounts. But this time, it has purchased hundreds of billions of Treasuries to lower yields. Treasuries yields have dropped to record lows, even as the government issues more to cover it's record debt.

And the Build America Bond program allows municipalities to borrow, with 35% of the borrowing subsidized by the public. These bonds have crowded out regular municipal bonds and droppped yields to near record lows.

Those living on fixed incomes have been in a tough pickle. My advice is to ensure that all savings and cd rates are getting the best possible interest. Be sure to open a high yield savings account or a cd via a site like BestCashCow.

And hold on. Yields will not stay this low forever and if anything, will rise dramatically as the dollar continues its decline/collapse and as the economy shows some small signs of life.

Every now and then the mainstream media will do an article covering the hatchet job that the Fed has done on the savers of this country. Today they printed one such article, entitled At Tiny Rates, Saving Money Costs Investors.There's really nothing in the article that we haven't said a million times before: the Fed is reinflating the economy at the expense of savers, the very investors who were least responsible for the economic collapse. The elderly who lived off a fixed income are being especially hard-hit as saving and CD rates tumble from 5-6% to under 2%.

Perhaps the most interesting part of the article was the following quote:

"Experts say risk-averse investors are effectively financing a second bailout of financial institutions, many of which have also raised fees and interest rates on credit cards.

“What the average citizen doesn’t explicitly understand is that a significant part of the government’s plan to repair the financial system and the economy is to pay savers nothing and allow damaged financial institutions to earn a nice, guaranteed spread,” said William H. Gross, co-chief investment officer of the Pacific Investment Management Company, or Pimco. “It’s capitalism, I guess, but it’s not to be applauded.”

I've written about this before also and it's appalling. What the banks do is borrow money from me and you, or even the Fed for 1% and under and then lend it out at 5-6%. They can't lose money. Banks are reporting profits because they are in a no-lose interest rate environment and also because they changed the accounting rules to make their bad assets disappear. You'd think they'd be sharing the wealth, but instead, credit is tight, and the banks are raising credit card rates and lending standards.

We help them recapitalize and strengthen and they stick us with the bill. Oh, and they pay themselves nice fat bonuses. Give me a break. A high schooler could recapitalize a bank in today's interest rate environment.

Is there anything you can do? Yes, if you plan to deposit money, make sure you deposit it into a high yield savings or cd account. You might as well get the best savings rate or best cd rates you can. Reward the banks that are willing to pay a bit more for your hard-earned cash.