Tuesday, December 16, 2008

Money Bad

I don't understand all this interest rate stuff. (For a banker that's probably a bad thing, right?) For one thing, every time some pundit comes on to the tv or radio to discuss What Went Wrong in the economy, he will always begin with "the abundance of cheap credit" in the nineties, which led to X, Y, Z and Hell. So if cheap credit was the first stepping stone on the way to "housing market crisis" and "frozen credit markets", how exactly is cutting the federal interest rate (again) NOW, a good thing? They're talking about making it smaller than it has ever been before, including during those crazy 90's. I don't get it, really*. Secondly, how is it that "rates go down" affects the rate at which I can EARN interest, but seemingly not the rate at which I can borrow? CD rates that were in the 4-5% range over the summer have dropped to 2%... or worse. Savings accounts are a joke. Treasury bonds are even worse. And yet my credit cards are still charging 16% interest. Even if I applied for a new card, the interest wouldn't be any lower than what I would be paying right now. Supposedly mortgage rates will be affected, but they're not going to drop that much, and they've been at "historical lows" for ages now anyway. So I get no benefit as a lender, OR as a borrower. Go figure.

Gift-wrapping PSA: It can be very, very important to use those little to:/from: gift cards as you wrap. For example: in my case, everybody in my family is getting some combination of books and/or sweaters. (Sorry, you guys.) If you're in a situation like that and you wrap too quickly, you'll end up with a pile of square-ish, book-shaped packages, and a similar pile of lumpy, sweater-shaped packages and not know which goes to whom. Luckily I could see where this was going after just one or two presents and broke out the gift tags, but it was a close call. I'm still not entirely sure that my dad and brother's books didn't get swapped.



* Please don't try to explain why it's a good thing now. Just nod your head in agreement with me, please.

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