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Online Savings & Money Market Account Rates 2022

Online Savings & Money Market Account Rates

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What I Still Remember 20 Years After September 11, 2001

I was not in New York on 9-11.   I was living in London at the time and I was in my office.   I remember a woman coming down the hall and saying: “Aren’t you from New York?” and then telling me that the World Trade Center had been hit by a plane.   I remember calling an ex-girlfriend in the South Tower and my best friend from high school in the World Financial Center.   Both told me that the first attack had just occurred moments earlier and described seeing a body falling from the towers   I told both to get the hell out of there and I am glad that I did.   My best friend from high school certainly would have been trampled in the commotion that followed had he not followed my advice.

My other memories relate mainly to a day exactly seven months earlier, February 11, 2001, when I interviewed for a job at Cantor Fitzgerald on the top floor of the North Tower.

I vividly remember going through security unlike anything I had previously experienced to get into an office building.   I was given a badge at reception with my photo on it (this later became commonplace in office buildings worldwide, but was a procedure that was only in place at the World Trade Center in 2001).  

I also remember needing to change elevators at the 72nd floor in order to get to the top of the building.   Somehow in my mind that felt odd and uncomfortable as if the building was built higher than technology would allow.   Once at 105, looking out the narrow windows and seeing helicopters flying over lower Manhattan below me also seemed odd.   So too did the unusual sound the urinals and sinks made in the bathroom because of the way in which water was being sucked up to that height.

I remember walking by the Cantor trading floor at 8:30AM and being amazed by the frenzy of activity that was occurring in the clouds before the market open.   I remember the faces.   I remember walking to get water and the grey haired trader emphatically describing a play from his son’s baseball game to a large group of his colleagues.   They all made eye contact with me as I walked past and wished me a good day.   I imagine that they would have all been there by 8:30AM some seven months later.

I also remember the smiles and the kindness of the assistants and receptionists who greeted me that day.  One receptionist explained to me that the man with whom I would be meeting next was one of the gentlest and nicest people I would ever meet.   In the weeks that followed, I read both of their obituaries in the New York Times.  

I kept the photo badge that I was given in the lobby on February 11, 2001 for many years, but I threw it out later when I decided it was an inappropriate keepsake.  Now, I have finally written my memories here.   This is better.


Why It Might Not be Such A Bad Idea to Earn 0.40% On Your Money Right Now

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As I write, in July 2021, we are living in a strange time.   We are facing extraordinary risks to our democracy in the US, risks to our health as COVID-19 variants appear, and risks to our environment as it becomes increasingly clear that the human race has delayed far too long to expect any meaningful investment to counteract climate change.

Yet, the US stock market sits at a valuation level where by any metric it is more richly valued than it has been at any point in our lifetimes (or at least in our memories).   In addition, every asset imaginable, including worthless coins, property rights and going concerns without any economically viable business model can be easily bid (manipulated) to a level where it can no longer be justified by even the most ardent of CNBC cheerleaders.

In our COVID times, cash has become trash.  The Federal Reserve began lowering the benchmark Fed funds on July 31, 2019 (before the virus), brought it to zero quickly when the virus hit, and seems to be willing to hold it there until 2023 while cravenly denying the existence of any inflation. 

The challenge with the current scenario is that while it seems like a ridiculous time to be holding anything in cash, asset valuations are so high that they could fall dramatically at any moment as a result of things that are foreseeable (a change in Fed policy), things that are not foreseeable or nothing at all.   And, we know from history that this can happen so quickly that very few will have a chance to save their assets.

Hence, I continue to say that it still seems like a good time to be protective and to keep some of your money in cash.   But, true cash alternatives are very unattractive.  Your broker at Morgan Stanley or Merrill Lynch is going to offer you 0.10% on brokered CD at the moment, which in addition to being a low rate is illiquid without a loss of principal.

A more attractive option – albeit still painful – is to put your money in an online savings account, as long as you stay within FDIC (or NCUA) limits.   Multiple banks that are part of the most solid financial entities in the world are offering these accounts at 0.40% APY at the moment.    And, the best thing about these accounts – particularly the accounts at American Express, Purepoint (MUFG) and CitizensAccess – is that you can transfer your cash back to a local bank account in order to take advantage of whatever opportunities or needs may arise in the near future.  (Other well-known and solid banking entities such as Barclays or Capital One also offer 0.40% online savings accounts, but reviews on BestCashCow indicate that transfers may take a little longer and service may be a little worse).  In fact, if you just take a few minutes to look at our list of the best online savings rates, you will find that there are also many banks that are willing to offer you more than 0.40% right now.

As you look out one or two years, you just do not want to find yourself in a position where you regretted not being a little more cautious.   And, if you are so young that you’ve reached the end of this article without appreciating the level of uncertainty we face ahead, then you might want to seek out someone who lived through 2000-2001 or who lived through 2008-2009.


Fed Leaves Fed Funds Target Rate at 0 to 0.25%, but Pencils In Two Hikes for 2023

The Federal Reserve today continued with its current rate stance and its current bond buying program, but is now indicating that it will back away from these easy-money policies in 2023 as inflation surges and growth accelerates.

While rates are not going up immediately, this means that investors should begin to prepare for higher rates over the coming years.

Preparation for higher rates should involve continuing to seek out the best savings rates on cash.   Rates on fixed income investments will begin to rise as we get closer to the Fed’s move, and certainly if the Fed is forced to advance its timeline due to continued inflation.   As a result, Investors should be very cautious about fixed income investments and avoid CDs longer than one-year.  

 Even though today’s move likely guarantees that borrowing costs will remain low for products like mortgages and home equity for another year, if you are considering remortgaging or taking out home equity loans related to properties you currently own, this would be a good time to check rates.