November 26, 2013
Santiago, Chile
Simon Black
On the flight down to Chile the other day from the US, I opened up a local Texas newspaper to an article entitled something like: “Getting the most out of your savings account”.
The reporter went on to list all the banks in the area where you could lock your money up in a 1-year Certificate of Deposit, and ranked them by who was paying the highest interest rate.
This will come as no surprise to you, but 0.9% was soundly in the top 10 for a 1-year CD… and 0.4% was in the top 10 for a 6-month CD.
“Pathetic” is probably the word that I would use to describe this. Perhaps even criminal.
We all know that the rate of inflation is substantially higher than what the government’s official reports say. But even if you use the government’s own numbers, “core CPI” is now 1.7%.
This means, quite simply, that if you hold cash in a bank account in the Land of the Free, YOU WILL LOSE MONEY. Period.
