Straight Talk from Al Jacobs

INTEREST IS RISING

 

Though it’s been rumored interest on savings accounts will remain in the cellar indefinitely, it appears certain select banks are offering more attractive rates than we’ve seen for many years. The increases are not dramatic, by any means, and the terms being tied to the higher rates are fraught with conditions, but the signs are unmistakable: At long last firms are willing to compete – at least to a limited extent – for depositors’ money.

 

The particular newspaper ad I spotted, with the heading “GREAT CD RATES,” was placed by HAB Bank, with local offices in Artesia California. With a minimum deposit of $1,500, a depositor can obtain an annual percentage rate (APR) of 2.48% for a 24-month CD or 2.68% for one of 36 months. You might note, HAB is not a California bank. It’s headquartered in New York and is listed as the 38th largest bank in the state of New York as well as the 521st largest in the nation. So, as you see, this is no major banking institution competing for funds … but perhaps it’s a straw in the wind. Why my attention was specifically drawn to this ad is because, in following these CD offerings as I’ve been doing, this is the highest APR I’ve yet seen, with the previous high about three months ago being 2.25%. I’m anxious to see where we go from here.

 

There was a time, not many years ago, when money could be deposited with a bank at a rate of five percent per annum, or perhaps a bit greater. Thanks to the federal government’s FDIC guarantee, it was thoroughly safe, so that many a retiree came to rely upon this as the bonus they needed to augment their Social Security and pension payments, together with any other dribs and drabs which kept them financially afloat. During the past ten years or so we Americans have been deprived of this option. It’s been tough slogging for many oldsters and I’m convinced that if the major banks have their way nothing will change.

 

With that said, let me offer a prediction. With the recent relaxation of the Dodd Frank 2010 legislation, together with the desire by the many remaining community banks to resume full banking capability, there’ll be a demand for depositors’ funds once again. And with this demand will come a willingness to offer a fair interest rate to those depositors … and although reluctantly, by the major banks as well. Within a reasonable period we’ll quite likely see the five percent interest rate return.

 

 

Al Jacobs, a professional investor for nearly a half-

century, issues weekly financial articles in which he

shares his financial knowledge and experience.

You may view them on http://www.roadwaytoprosperity.com

 

 

Straight Talk from Al Jacobs

 

VIEWS OF THE HOMELESS

 

As perceived by California Lieutenant Governor Gavin Newsom, candidate for governor, there’s a “lack of leadership” in addressing homelessness at the state level. He vows he’s prepared to “get deeply involved at a granular level where most governors haven’t in the past.”  He added that “I want to be held accountable on this issue, and I want to be disruptive of the status quo. I’m willing to take risks. I’m not here to be loved. What’s going on is unacceptable, and it is inhumane.” As part of a broad strategy he took as San Francisco Mayor, he pledges to end chronic homelessness by developing housing and family reunification programs for those living outside the longest.

 

Through the eyes of State Senate Pro Tem Kevin de León, candidate for the U.S. Senate, California must adopt a philosophy for treating homelessness he refers to as “housing first” – a recovery-oriented approach to end homelessness centering on quickly moving people experiencing homelessness into independent and permanent housing and then providing additional supports and services as needed. His support for a homeless housing program originated in January 2016 when he proposed a $2-billion bond to finance new and rehabilitated housing for mentally ill people living on the streets. As he said, “It makes no sense to provide social services, only for them to go live behind an alley or in a cardboard box.”

 

As seen by Los Angeles Mayor Eric Garcetti, presidential hopeful: A “shelter crisis exists today,” he claims, “for the estimated 25,237 unsheltered homeless who call the city home.” He claims the city will ease or eliminate restriction on homeless shelters, allowing them to be quickly built on land owned or leased by the city. The mayor also announced the inclusion of $20 million in his proposed 2018-19 budget to help fund new shelter facilities. As Garcetti said, “This is the right thing to do. It’s the moral thing to do.”

 

As viewed by Jon Johannessen, a local resident who must live in the beleaguered community of Venice, California: “Boo [to them all] for failing to understand. There is no ‘homeless’ problem. Instead there are mentally ill people listlessly wandering the streets in rags. There are drug-addled screamers raging at life day and night. There are ‘street people’ who accept money and services from our government but have no intention of ever working. This cannot be solved with temporary shelters.”

 

 

Al Jacobs, a professional investor for nearly a half-

century, issues weekly financial articles in which he

shares his financial knowledge and experience.

You may view them on http://www.roadwaytoprosperity.com