Start of the Day with Chris Forte – Fed Rates

Posted on September 19, 2022 by Scott Shuda

I’ve good bad news, good news, and more bad news.

The Federal Reserve has been raising interest rates this year. That’s bad news if you want to borrow money for a house or business or carry a credit card balance.

The good news is that should help use earn more on our savings accounts.

That bad news is it hasn’t helped savers. The average rate on savings accounts is a miserable 0.13%. What gives?

Banks use your savings to make loans. Right now there is a glut of money in savings accounts, more money than the banks can find loans for. So it’s supply and demand. The banks have no reason to entice you to stash more cash in their vaults.

The fear of a possible recession also has banks feeling skittish about making loans, thus less demand for your cash.

Slowly but surely the savings glut is shrinking. The pandemic relief programs checks that fattened up accounts are gone and being used up.

Where do you get your best bang for your savings bucks? Online banks with low overheads will give you a better rate than your local brick and mortar bank.

Still, the rates aren’t back to where we were before the pandemic. The average online bank is offering 1.8%, lower than the 2.2% in 2019.

Okay, then how about locking into a 1 year CD? The best you’ll do is between 2.50% and 3.0%. That’s more palatable than a savings account, but still losing the war against inflation.
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QUICKIES
*
Intrusion (INTZ) jumped 14% on Friday, ending at $5.01. INTZ is followed by Aaron Warwick who is very high on the company.
*
Harmonic (HLIT) also bucked the trend Friday gaining 6%. HLIT is followed by Steve Kraus.
*The story, “The “
world’s largest” indoor vertical farm will be built in Virginia” is posted on the Feed by Scott Shuda. He says, “About a year ago, I was invited to join a visit to the offices of Urban Grow (UGRO) in Colorado. Vertical farming is still quite new to me, but it is intriguing.”
*
Florian Buschek who follows fertilizer company Verde Agritech (AMHPF) posts an interesting conversation with the owner of a business that sells Verde’s product in Brazil.
*Florian also posts that
Warren Pies is overweight energy for multiple reasons and he notes that some housing exposure might be a good idea too.
*”With more advertising dollars flowing to streaming due to cable cord-cutting accelerating,
Trade Desk (TTD) is called out by Barron’s as a potential winner. Microsoft (MSFT) is also identified as a rising ad player that should benefit. – Seeking Alpha
*Dominating: After three games Georgia’s defense has allowed one TD and has 6 turnovers. They have outscored their opponents 130-10.
*
Michael Kramer of Mott Capital, “The internals on Friday was pretty bad, especially on the NASDAQ, with 451 more new lows than new highs. That was the lowest reading since early July.” He warns that likely “…new lows are coming to this market sooner than later.”

“Yeah, the president helped broker a deal with the railroads that went down to the wire. Biden was like, ‘I think I can, I think I can, I think I can.’” — JIMMY FALLON

Good luck to all – Chris

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