Banks Are Using High Interest Rates to Rip Off Depositors
The spread between loan interest rates and deposit rates is at a record high, allowing big banks to make out like bandits while consumers miss out on hundreds of billions of dollars in potential savings.
The JPMorgan Chase logo is seen at its headquarters building on May 26, 2023 in New York City. (Michael M. Santiago / Getty Images)
It is easier to rob by setting up a bank than by holding up a bank clerk.
-Bertolt Brecht
The last time you checked your bank statement, did you take a moment to look at the fine print that shows the interest rate you are being paid on your deposits? If you did, you may have noticed that it still seems pretty negligible, even though you’ve seen so many headlines about the Federal Reserve hiking the interest rates that banks charge for loans.
This is the Great Bank Robbery of 2023 — the yawning gap between what you are paid on your deposits and what banks are earning from other institutions when they loan out your money. It’s a caper that has quietly become a systemic upward transfer of wealth thrumming beneath the macroeconomy — but as you’ll see below, the theft can be stopped.
This article is for subscribers only. Please login or subscribe to access our full archives and beautiful print and digital magazine starting at just $3 a month.