But if you don’t do anything, you only lose one day interest, compared to two for a Saturday maturity. This assumes you use a bank that credits you interest on the day the pull is submitted, e.g. Marcus.
I guess in this case, you are actually getting double interest for Fri?
Agreed. You’re right. But my motivation was not so much that double interest. I just did not want to lose interest entirely (or very nearly) for Saturday, Sunday, and possibly even Monday.
Still, with a Sunday CD maturity I most likely would not have done anything at all. Too risky. I HATE Sunday CD maturities!
CD aficionados, and fixed income market participants generally, should pay heed to happenings at the Fed. This week will see their annual Jackson Hole, WY meeting. It’s a place where “stuff happens”, even though the meeting will be held virtually this year. But it’s a big event nevertheless.
CNBC is reporting Powell will use the occasion of this year’s meeting to unveil a new Fed policy regarding inflation. In a word, he wants “more”, a whole LOT more. And he is ready to move heaven and earth to achieve his goal.
You can read here about the bad news for us:
Jerome Powell to reinvigorate Fed war on fixed income investors
But the stock market is already doing great, you protest! Why does Powell need to redouble his efforts to squish us like bugs? You’re asking the wrong guy. I’m on your side!!
Marcus finally dropped the NPCD rate: 7-month from 0.90% to 0.75%.
Watching
Today, 26th of August, commences watch for the NCUA Q2 quarterly data summary report. For anyone wishing to join the watch:
Watch for NCUA Q2 quarterly data summary report
At this writing: no report yet.
When it arrives it will display as “June” on the 2020 line.
The June report will be the first which reflects three full months of pandemic impact.
Sounds like it’s time to borrow, not save.
Definitely not a good time to lock long term CDs if Fed wants to bump inflation. At this rate, it’ll be very hard to keep your CD savings from even breaking even vs inflation. My guess if the Fed wants a low savings rate + higher inflation to convinced consumers to spend instead paying down debt and reducing/deferring purchases.
We’ll see if their efforts pan out. Over the years, Japan tried a lot of things to get out of their stagflation cycle with very limited success. Remains to be seen whether the Fed will be more successful with their policies.
Inflation is a way for highly indebted countries to handle their payment obligations. Could that be the reason?
I think it plays a part in it. Considering how much the unprecedented amount we’ve just added to our debt, it’d certainly be a way to pay for runaway deficit spending by screwing fixed rate investors.
Well for those of us in at PSECU, they just sent an email updating members on their financial health given the covid crisis. Here’s an excerpt with the pertinent information. Looks like our money is very safe there.
Although challenged by the current economic and interest rate environments, PSECU’s financials remain strong. Through the first half of the year, we’ve produced $17.2 million in net income - well ahead of plan. As a result of strong deposit growth, we recently crossed the $7 billion asset threshold!
Many thanks to you, zzz, for your post. I appreciate it very much, though it also troubles me a bit. You see:
I am a PSECU member. But I have not as yet received any such email from them. I must look into this pronto.
They’re using your money to make sure his money is safe. 
Update
Received late morning today the PSECU email mentioned earlier by zzz. Very good. No complaints
Re:"… important also to consider that any financial institution, with 30 days’ notice, can terminate the add-on provision of its CD accounts. Should that happen one needs to move quickly to access and deposit funds into the CD before time runs out. This seems common knowledge thatI should have known. Do u have a link or refernce? Thx
There is none. It’s based on the bank’s standard account terms saying that they can change the terms at any time for any reason. Either the there is no CD contract, meaning they can change the rate or term as well, or the CD is a contract they’re bound to.
A couple banks in the past have decided to remove their add-on term from existing CDs, no one felt inclined to sue them to enforce the CD contract, so now some believe it’s a universal rule they’re able to impose at will.
Although you are probably right, if part of the contract or your membership terms include arbitration, I wouldn’t bet the farm on an arbitration ruling.
If arbitration was on the table for the couple times banks did “get away with it”, I wouldn’t be surprised if there were also a number of arbitration settlements with nondisclosure agreements…
The 30 day rule comes straight out of the NCUA and applies to all member institutions. It was years ago that I contacted them, citing this rule, in the wake of shenanigans being pulled at that time by Valor. The NCUA eventually forced Valor to re-open add-on deposits for thirty days following proper notice given to members, which they had not offered members, myself included, in the first place.
I also ran into this rule back circa 2007-2008 with USCU (United Services). Same routine. USCU closed down promised access to their add-on CD without notice. The NCUA forced USCU to provide 30 days’ notice and re-open access for that interval. I personally added funds to my CD, taking advantage of the opening.
I once had the specific NCUA rule citation, back when I needed it. No longer. But having been through the drill twice so far, I know the rule.
Also, if you do a deep dive over on Ken’s website, regarding both Valor and USCU, you will be able to find reference to all this stuff. A great many people were impacted.
And you’ll also find an article, written by Ken himself, exploring such “rule” and determining that no such thing actually exists. But this has gone in circles enough times already.
Link please
It’s been posted here before. You ignored it then, I’m not going to hunt it down just so you can ignore it again.