Is this pure greed or by govt regulation or something else. Would like to get a banker/financier’s perspective.
The banks know they dont want you keeping money in either of those accounts. It's a losing game for both you and them and so they make the advertised rates ridiculous to make you not go into them.
>Is this pure greed or by govt regulation or something else. Would like to get a banker/financier’s perspective.
Focusing on the bank pov. If you let $10,000 sit in a savings account. They cant give you 8%. Even if they give you 4% you are losing 4% in real yields. You shouldn't do that. But it goes further. If the banks all give 1%. You decide the put the money elsewhere.They actually know they will benefit from that more than ever giving you a reasonable losing real yeild rate.
This has much more to do with 1980s repeating and the nature of economics from the population pyramids. Too many people are heading into retirement and moving their investments into "safe" investments. So retirement funds are obligated to buy bonds and similar. Which the opposite side of that transaction requires someone to be issuing the bond but the homelanders aren't buying. So rates are very low and inflation will be high.
Banks are optimized around transactions; doesn't matter about sizes. They just want transactions to be happening. They want things/purchases/experiences to be happening and money sitting in accounts is antithetical to their goals. It is greed in a way but not the cigar smoking fat monopoly man kind of greed.
From government point of view. They are a bunch of idiots who made the bad situation so significant worse. As they always do.
In 6 months to a year when it's finally obvious that cash is going to be worthless for awhile, they'll increase rates to encourage unsavvy customers to take the hit for it. This way, they siphon off 5% of everyone's real world wealth and as an added bonus it looks like they're doing everyone a favor.
As above, Marcus is currently at .7%, Amex increased to .65% last week, and BrioDirect woke from a long .4% slumber to rise to 1% about 10 days ago.
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