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by hypercube336 hours ago |
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upvoteby Betelbuddy5 hours ago|
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>> People just give them money as a business model.

You dont actually give them money...you loan them money when you do a deposit. That is why they pay you interest, and that comes with the risk of loans to another party.

A little detail they are happy to omit and they are happy to let people talk about: "I have money in the bank", that you of course ...dont have.

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upvoteby zdragnar5 hours ago|
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At least in the US most banks are FDIC insured so your first $250k or so in deposits are secured by the government.

There's no real risk involved.

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upvoteby drknownuffin2 hours ago|
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Incorrect-ish. 12 U.S.C. § 1821(f)(1) states that payment shall be made by the FDIC "as soon as possible," but as my sister-the-lawyer has always been at pains to point out to me, the most up-to-date specific language is from 2016's 81 Federal Register 87734, 87735, section B, which explicitly states that they "[do] not specify a time period for paying insured depositors." In other words, if it's a tiny bank failure you might get lucky and get made whole in a few business days, but if it's something larger, they can choose to meet their regulatory obligations over the course of decades - which is very much real risk.
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upvoteby wing-_-nuts1 hours ago|
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I mean, I get it, but that would destroy any credibility of the insurance, and would undermine the whole point of the system.

I trust the FDIC to be far more johnny on the spot to resolve a liquidity issue than I do any private entity

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upvoteby Betelbuddy3 hours ago|
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The existence of the FDIC is in itself, the proof there is risk involved :-)

As of June 2026, the FDIC had approximately $161 billion in its insurance fund against...drum roll... $10.8 trillion in insured deposits.

Good luck calling on your insurance on a systemic bank crisis....

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upvoteby zdragnar2 hours ago|
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Even when the current funds available are insufficient, it can borrow from the federal government or issue debt to cover the insured deposits.

A situation which calls that borrowing capability into question would mean the economy is so bad the dollar is worthless.

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upvoteby lotsofpulp2 hours ago|
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This particular insurer is unlike others because it can ultimately edit entries in a database whenever it wants. As long as you are part of the group that is considered worth editing the database for, such as a depositor at one of the too-big-to-fail banks, then you have nothing to worry about.
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upvoteby throw0101c4 hours ago|
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> At least in the US most banks are FDIC insured so your first $250k

More if you're in Silicon Valley… semi-/s

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upvoteby elictronic2 hours ago|
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Ehhhh, I'll take a law over begging and praying.
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upvoteby cowlevel5 hours ago|
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The interest rate banks pay you has been 0% since before covid
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upvoteby jagraff5 hours ago|
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That's definitely not universally true; my US bank pays 3.2% interest on savings
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upvoteby abighamb5 hours ago|
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And what is inflation?
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upvoteby ImPostingOnHN4 hours ago|
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A general, continuous increase in the overall price level of goods and services in an economy over time.

Not really related to the discussion here though, since we were determining whether the interest rate is zero.

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upvoteby jachee36 minutes ago|
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Any interest rate that is equal to or less than inflation is functionally zero (or less).
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upvoteby TFNA5 hours ago|
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This is a thread about a EU bank, and banks in the EU both have some standard interest rate on savings accounts, and moreover might offer time-restricted savings accounts with an even higher rate. That said, they track poorly with inflation compared to actual investment.
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upvoteby louthy2 hours ago|
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I get 4% (instant access savings account with Revolut, UK)
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upvoteby tekla2 hours ago|
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Ally has been 2% from before Covid and currently is at 3.2%
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upvoteby Betelbuddy5 hours ago|
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Zero is also a number, although not all Mathematicians accept that. 0% interest does not change the essence of the monetary relationship with your bank, or the risk profile.
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upvoteby wtch985 hours ago|
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My bank in the uk pays me 3%
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upvoteby lotsofpulp5 hours ago|
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I have been able to easily find a US bank that pays roughly SOFR minus 25 basis points for FDIC insured savings accounts, even before 2020.
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upvoteby sidewndr465 hours ago|
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isnt it the opposite in parts of the EU? you pay interest on the deposit
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upvoteby cowsandmilk5 hours ago|
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I don’t know of any bank that hides the fact they lend out money. Most pretty actively advertise it.
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upvoteby tharkun__4 hours ago|
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Technically true I suppose. But go ask the average person on the street where the bank gets the money they lend people for mortgages and cars and such and I guarantee you the number of people that make that connection is going to be much much smaller than you seem to want to suggest.
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upvoteby drdec4 hours ago|
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It doesn't actually work the way it's portrayed in It's a Wonderful Life. The banks don't use depositor money to make loans. I suspect you will think what they actually do is even worse. Look into fractional reserve banking.
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upvoteby tharkun__3 hours ago|
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Never seen that movie but did watch a documentary ages ago about fractional reserve banking yes.

The bank still uses the deposit money in that system. You are right to point out those same people on the street I mentioned would freak out even more if they knew that banks essentially lend out more than we deposited and also that they might sell your debt and all that jazz (I bet most people either never understood what happened in 2008 or forgot already other than a vague "yeah mortgage crisis")

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upvoteby Betelbuddy3 hours ago|
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>> I don’t know of any bank that hides the fact they lend out money.

Absolutely true. They question here is how many announce they are borrowing from you :-)

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upvoteby parineum1 hours ago|
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This is like those articles that say, "[entity] quietly [doing totally normal thing]" to frame it like it's some devious thing.

That's what banks do. It's not a secret. Any cursory understanding of banking gives you that information.

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upvoteby msla21 minutes ago|
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Well, you're probably going to be very disappointed when you learn how money works in general these days.

Hint: Gold has no more to do with it than any other commodity does. Ditto with petroleum.

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upvoteby doikor5 hours ago|
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> Why would banks be motivated to care?

Because courts have made them pay the curtomer their losses when the customer (not the bank) was scammed/hacked/etc.

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upvoteby pc864 hours ago|
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And you don't think that plays some part in all these arcane security requirements that basically amount to "you're doing something a little weird so we're just going to block you rather than support it"?
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upvoteby mschuster915 hours ago|
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> Why would banks be motivated to care?

Unfortunately, banks can be held liable for customers getting scammed. Even if they win in the end, they have to make the customer whole first no matter what [1].

[1] https://www.tagesschau.de/wirtschaft/verbraucher/eugh-konto-...

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upvoteby 65101 hours ago|
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They are breaking the law, that should be motivation enough. That the number of non android non ios users is small shouldn't be relevant. The locked down android and apple devices are like virtual US soil. The obligation should be to service all EU citizens rather than a sub set.
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upvoteby mixdup5 hours ago|
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Banks are motivated to care, but in the direction they currently do. They can be on the hook for making up losses. Whether you as an ultra leet hax0r can run rooted/jailbroken devices without getting owned, they are worried about your non-leet parents doing the same and having their retirement accounts drained by North Korea. I know it sounds far fetched, but it is a plausible scenario that I heard recently
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upvoteby xp842 hours ago|
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The same banks that typically embrace the 3 biggest signs of security stupidity:

- max length of passwords (not talking about lengths that would pose a DoS threat, talking limits like 20 characters)

- incredibly constrained character set for passwords (“your password can’t contain a quotation mark, only alphanumeric and these specific 10 punctuation marks”)

- “security” questions (can we just ban these already? Knowing that my childhood dog’s name was Bingo should NOT give you the ability to change my brokerage password.)

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