Gold pays no interest

[James and Terry Hamilton]

Posted by
http://ShekinahLife.com


Subject: Gold pays no interest, and soon the pound won't either


"A cut in interest rates raises the bizarre possibility that some savers may soon end up having to pay banks to keep money with them."

This is like turning the voltage up higher and higher on the paddles hoping to restart the heart of a corpse that has had the blood drained from it.
Anyone who thinks that the financial shenanigans being played by the banksters and politicians have anything higher than a zero chance of working is simply ignorant. It's even worse than a "bizarre possibility" of savers paying banks to hold their money, it's already a negative savings rate when inflation is taken into consideration, and has been for some time.

The only question is whether this economic collapse is the result of sheer monumental stupidity on the part of banksters and politicians, or if it is being done intentionally. I would vote for stupidity if it weren't for the historical record of the globalist Insiders' intention to weaken the US enough to merge it with the socialist and authoritarian nations that can't compete with a free market economy.
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ARTICLE HERE::::

Savers Facing Accounts with No Interest

By Edmund Conway and Myra Butterworth
The Telegraph, London
Friday, January 2, 2009

http://www.telegraph.co.uk/finance/personalfinance/savings/4077360/......

Millions of savers are braced for zero per cent accounts within days as the Bank of England is poised to cut interest rates to the lowest level in its 315-year history.

Experts have warned the return on savings could plumb new depths with the Bank expected to take unprecedented steps to regain control over the economy.

They widely believe the Bank will reduce borrowing costs to below their 2 per cent level -- and possibly all the way down to 1 per cent -- in its first meeting of the year next week.

More than 7 million people have saving accounts which already pay interest of 1 per cent or less. If a cut is passed on in full by banks, these accounts will dive towards negative territory for the first time on record.

Many elderly people who rely on the income from savings have found themselves struggling in recent months as returns fall.

Just 18 months ago average interest rates on savings accounts were as high as 6 per cent. But consecutive cuts by the Bank's Monetary Policy Committee have led to banks slashing their savings rates, with the current average rate being just 2 per cent.

The Daily Telegraph has launched a campaign aimed at giving pensioners a tax cut on the income earned from their savings and investments to help them during the recession.

Mark Dampier, of asset managers Hargreaves Lansdown, said: "It is a dire times for savers, especially for elderly people who rely on their income. They have already seen a sharp drop in excess of 50 per cent, and can anyone tell me of someone in the public or private who would put up with a 50 per cent pay cut?"

A cut in interest rates raises the bizarre possibility that some savers may soon end up having to pay banks to keep money with them.

Kevin Mountford, head of savings at Moneysupermarket.com, said: "A large number of savings accounts pay only 1 per cent, and so a wave of savers will end up receiving no interest at all if rates are cut significantly again -- and may, in theory, end up paying banks for having being prudent savers.

"All round it is bad news for savers."

Calls for a rate cut were strengthened by evidence that Gordon Brown's L300 billion banking bail-out has failed to make it easier for households to borrow money. The credit crunch is instead set to worsen in the months ahead and lenders intend to make it even more difficult for customers to borrow, according to a new report from the Bank.

They intend to continue passing on only a fraction of the Bank's rate cuts and increasing the stringency of their loan conditions as they seek to repair their own balance sheets.

New figures showed that house prices have fallen by a record 18.9 per cent in the last year. The average house is now worth what it was in August 2004, according to Halifax.

Amid the deepening economic crisis, experts warned that while borrowing costs look certain to remain high, savings rates, which have already fallen fast, are set to dip to the lowest levels on record as soon as next week.

Economist Howard Archer of Global Insight said: "It seems a stone-dead certainty that the Bank of England will deliver another hefty interest rate cut next Thursday."

If they do, it will take interest rates to the lowest level since the Bank was founded in 1694.

The forecasts come after Nationwide announced that it is reducing the interest rates across its savings and banking accounts by an average of 0.87 per cent following the Bank of England's decision to cut rates by one percentage points in December.

The cuts mean some of its savings accounts pay as little as 0.5 per cent gross, such as its e-savings plus account if customers make more than three withdrawals in a year. The building society is also refusing to pass on any further interest rate cuts to its customers with tracker mortgages.

The Bank of England indicated that there would be further examples of this in the coming months.

Its Credit Conditions survey underlined the growing realisation that the banking bail-out package unveiled by Gordon Brown in October has failed. Although the bail-out has ensured the survival of the major banks it has not fulfilled its other promise: to increase the availability of credit to families.

It raises the prospect that the Government will be forced in the coming months to pump another multi-billion-pound sum into the British banking sector -- perhaps going as far as to wholly nationalise some of the biggest lenders.

Analysts believe there may be no alternative if the Government truly intends to increase the availability of mortgages to British consumers.

David Cameron urged Gordon Brown to admit that his bank recapitalisation plan has failed and more needs to be done to get banks lending to businesses.

The Conservative leader said: "Instead of Gordon Brown striding round the world lecturing everyone about the brilliance of his bank recapitalisation plan he has to recognise that it hasn't worked.

"The banks are now traumatised and trying to rebuild their credit -- the government needs to react to move banks out of that position -- small businesses shouldn't be going bust and they are because they are not getting the money they need."

He said it was vital that the Government brought in a national loan guarantee scheme. The Telegraph revealed last month that ministers are working on a scheme which will see the Government guarantee part of new loans that banks agree with businesses.

A Treasury spokesman said: "The Government is continuing to closely monitor commitments made by banks, through (the) new lending panel, and will continue to take whatever action is necessary to ensure the availability of new lending.

"Recent actions by many of the major banks to increase the availability of lending in 2009 are welcome but clearly we need to see more.

"As the Chancellor has said, he is prepared to look at further measures to make it more likely that banks will lend, but banks have to understand that with billions of pounds of taxpayers' money invested, or being made available as a guarantee, the public and businesses are looking for something in return."

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