Jan

14

 Does anyone recall the regulations back in the 70s on banks that forced them to offer things like toasters, blenders and coffee makers in order to attract new depositors? I believe deposit interest rates then were set by the government [Regulation Q] and the banks could only compete for deposits to lend by offering other incentives to savings depositors, like kitchen appliances. Today the situation is playing out on the lending side. The banks are awash with funds, but the Fed has forced the lending rates so low they will not cover the credit risk on mortgages or small business loans. Now the banks offer free (metaphoric) toasters to be left alone so they can just buy Treasuries.


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