Yorkshire BS cutting savings rates

kidmugsy

brewerdave wrote: »

Don't know why I haven't received an email.

I didn't get mine till today.

pqrdef

Barnsley BS Online Saver is also going down from 2.5% to 1.9%. Not so long ago, YBS were bragging that they haven't reduced an existing rate for 3 years. They must have known that wasn't going to last.

oldfella

have checked with YBS - the regular savers are not changing

C_Mababejive

grey_gym_sock wrote: »

i suppose the thing is: if they'd left the rate at 2.1%, it would now be back in the best-buy tables.



that doesn't hurt the institutions at all, though. it just means giving up your 1.65%, or whatever you can get (not much more).

or perhaps, if a lot of ppl did it, it would force the best rates up from about 2% to 2.1% ... which would be good for those of us not doing it ... so yes, go right ahead and take your money out

I have done . can get an easy 4% and up nett.

talexuser

C_Mababejive wrote: »

I have done . can get an easy 4% and up nett.

Please tell us how, with 80 grand and the same risk as a building soc.

C_Mababejive

talexuser wrote: »

Please tell us how, with 80 grand and the same risk as a building soc.

I know what you mean but we are in a different world now.

Think about risk and think about what happened when Northern Rock crashed. All those people never once thought that they would be queued round the block praying that their savings hadnt disappeared.

Think about Iceland Bank. A bank just like any other except that it was based in Iceland. One day it was solvent,the next day it crashed and burned.


Now think about something like investment grade corporate bonds.

They have superiority over share holders and are backed by solid British/Foreign Blue Chip companies. They are backed by real operating businesses that have real assets. What assets do banks and BS have? All they have are numbers scribbled on spreadsheets. They dont even have real gold reserves to back up deposits. They collect in your money at the front door and fly it out the back door.

Investing in real businesses is good for you and good for the economy. It pumps finance into real businesses and not to the moneychangers who create nothing but wealth for themselves.

Add on the power of accumulation and dividend re-investment and you have a powerful force.

grey_gym_sock

what assets do banks and building societies have? building societies mostly have security on real estate. which is a pretty secure model. better than gold reserves, IMO.

i wouldn't disagree that buying shares is a good idea for the longer term. but only for the longer term. e.g. if somebody's planning to buy a house next year, they're better keeping their deposit in savings accounts, even with slightly negative real interest rates.

pqrdef

C_Mababejive wrote: »

I have done . can get an easy 4% and up nett.

Is that current yield or redemption yield? If you buy at a premium and hold to maturity, that's not a fluctuation, it's a guaranteed loss.

But the bigger risk is that markets will turn ugly and force interest rates up. Then you'll be unable to move your money without selling at a discount.

Comparable with a savings account, not.

talexuser

C_Mababejive wrote: »

I know what you mean but we are in a different world now.

In other words you can't get 4% on large sums of money with the same risk as a building soc. Nobody rates corporate bonds as the same risk as savings.

C_Mababejive

#20 indeed and im not saying that its the same level of risk. You just need to think about what risk really is.

For example,what will all the savers do when the BoE reduces its rate to 0% and the BS follow suit?