merrill-lynch 5.65% 6 month CD

[[A]varice]

hot interest rate on a 6 month cd rate (http://www.bankaholic.com/2006/merrill-lynch-565-6-month-cd-rate/) account at merrill lynch bank. this is a promotional special offer, so dont let it get away!

[fireblast713]

wow... and only a 25k min investment!

[Stu55]

It usually takes money to make money.

[EzEddie]

if u have 25k sitting in a bank account, this is an easy $1400 made for sitting there...

[Hulk]

not to be a partypopper but there are better ways to invest 25k - like putting a downpayment on a house/condo and renting it out...

[KuJaX]

not to be a partypopper but there are better ways to invest 25k - like putting a downpayment on a house/condo and renting it out...

Increased risk.

[gangolfus]

if u have 25k sitting in a bank account, this is an easy $1400 made for sitting there...

It's a 6mo CD, you would get only $700 ;)

[Darth Millennial]

CDs are only good for long term investment.

[Tuffgong4]

CDs are only good for long term investment.

working in a bank and dealing with all types of investments from mutual funds all the way down to interest bearing checking accounts and dealing with mortgages, a cd is a worthless investment.

From the information we receive from investment companies and our bank itself if you would have put money in a cd in 1970 your average annual return with inflation is 3 percent without paying taxes on that money.

PLus usually places like Merril Lynch have account fees. Actually if you have money that something has to be done with you can find like 5% liquid money market accounts or a find short term cds...so technically cds are only good for short term horizons...sometimes.

[beowulf7]

One is better off putting the money in a high yield savings account, such as E-Loan, which is currently offering 5.50%. It doesn't have the "U Can't Touch This" restriction that CDs have. (My apologies to M. C. Hammer. :D) In this case, E-Loan doesn't have the high min. req. that Merrill Lynch does.

Since the Fed has said they don't plan to cut interest rates until 2008, yields from such savings accounts probably won't decrease much, if at all, for the next 6-12 months.

[jmphx]

c'mon guys. All this talk about how much CD's suck. Every person has different investment goals and requirements. Sure, CD's have a low return, but the risk is also extremely low.

If you have cash that needs to be very very low risk and does not need to be used soon, then a CD is not a bad spot at all. Especially if you were just going to let it sit in your bank's 1-2% savings account.

Personally I use a CD ladder to stash the 'rainy day fund' (some day I hope to rename this the "f*ck-you money fund". It's a good fit and balance between when the money can be accessed (if i ever need to) and return (quarterly or yearly for different chunks of the cash, depending on how you construct the ladder).

Although I do admit that some of these 5% and 5.5% money market accounts from eloan.com and others are making 6,9, and 12 month CD's at the same rates (or lower) less attractive. At least with the CD, your rate is locked though. So once again, you make a trade-off -- reduced interest rate risk in exchange for restricted access to the money.

But if you're getting your investment advise from [h] in the first place, you're in trouble. ;)

[beowulf7]

c'mon guys. All this talk about how much CD's suck. Every person has different investment goals and requirements. Sure, CD's have a low return, but the risk is also extremely low.

If you have cash that needs to be very very low risk and does not need to be used soon, then a CD is not a bad spot at all. Especially if you were just going to let it sit in your bank's 1-2% savings account.

Personally I use a CD ladder to stash the 'rainy day fund' (some day I hope to rename this the "f*ck-you money fund". It's a good fit and balance between when the money can be accessed (if i ever need to) and return (quarterly or yearly for different chunks of the cash, depending on how you construct the ladder).

Although I do admit that some of these 5% and 5.5% money market accounts from eloan.com and others are making 6,9, and 12 month CD's at the same rates (or lower) less attractive. At least with the CD, your rate is locked though. So once again, you make a trade-off -- reduced interest rate risk in exchange for restricted access to the money.

But if you're getting your investment advise from [h] in the first place, you're in trouble. ;)

While the advantage of a CD is that the interest rate is locked at the stated rate, that's also a disadvantage. If market rates continue to go up, the CD rate won't, but the savings rate will. So the argument of "better rate protection" of a CD doesn't hold true when you think of the converse scenario I mentioned. But a savings account is undeniably more flexibile (e.g. allowing access to the $) compared to a CD.

Now if the best savings rates were 2-3% less than the going CD rate, then it would probably be worth locking the money in a CD. But that's not the case today. :)

[UL]

CDs are only good for long term investment.

this is a short term CD, and as of right now a short term CD provides a higher rate than long term. Why you might ask? because expectations are that rates will likely fall, therefore the CD's should as well.

While the advantage of a CD is that the interest rate is locked at the stated rate, that's also a disadvantage. If market rates continue to go up, the CD rate won't, but the savings rate will. So the argument of "better rate protection" of a CD doesn't hold true when you think of the converse scenario I mentioned. But a savings account is undeniably more flexibile (e.g. allowing access to the $) compared to a CD.

Now if the best savings rates were 2-3% less than the going CD rate, then it would probably be worth locking the money in a CD. But that's not the case today.

just thought you might know that most "experts" believe the fed will hold rates constant for almost another year. So rates meet that expectation. Also a CD rate is locked in like you said but a savings account rate ISN'T most are based on current APR. So if you think rates are going to rise than maybe a savings account is right for you. But if you think they might fall than a CD is right for you. With the way rates are as of this moment i forsee it far more likely that rates will see a decrease before they see a rise. The market agrees with this too, as before stated, a long term CD offer a lower yield than short term.

So being the economist that i am I would agree. The fed will mainly raise rates for 2 reasons which are basically one in the same. That is curb inflation by decreasing the supply of money (note an increase in rates leads to a decrease in demand for money at the same time makes bonds more lucrative (since they now hold a higher yield) effectively enacting a contractuary money supply (but bonds themselves are another way of control, this is a 2nd rate effect.))

ALL that crap said, and understanding that inflation is undercontrol they MAY enact one of there 3 tools (the FED) to make a play at growing the economy. Remember a slight decrease in rates leads to a huge growth in the money supply (it is non linear) because there is a little thing called a reserve ratio which leads to a money multiplier. So the less interest borrowers are paying the more being loaned out obviously. And the ammount being loaned out isn't actually held in the bank only a fractional ammount of it is. For exampled i put $1 in savings the bank can loan out lets say 75% of that. Meaning all they have to do is hold $.25 for me. thus effectively creating money.

Anyways its nice to see a fed chairman that knows what hes doing. He is concentrated on long term goals not short term. He is willing to put the economy through a bit of "hardship" in the short term to create a more stable future"

Will rates go down? its more likely than not
Will it be with in 6 months? Not likely
With in a year? Likely
Will we see 2-3% interest rates soon? I would hope not, and baring unforseen circumstances (something stunting the economy) rates should not go below 3.25%-3.50% in the near future. (5 years)

A CD is great you are beating inflation 3% (but its actually decreasing because it is undercontrol) and your making a small profit. Now im not saying a well managed money market account or a 401k aren't better, but a CD is simple for most and involves almost no risk.

BTW for those of you that don't know a 401k is the best way to invest. Your company will usually match funds you put in, yes you can only borrow half of it. But thats nice too since you will always have something left for retirement. Also the greatest part is, if you need money, your paying your self back the interest. Its a win win situation. I encourage as many people as possible to start this early.


/the end

[[A]varice]

this is a short term CD, and as of right now a short term CD provides a higher rate than long term. Why you might ask? because expectations are that rates will likely fall, therefore the CD's should as well.



just thought you might know that most "experts" believe the fed will hold rates constant for almost another year. So rates meet that expectation. Also a CD rate is locked in like you said but a savings account rate ISN'T most are based on current APR. So if you think rates are going to rise than maybe a savings account is right for you. But if you think they might fall than a CD is right for you. With the way rates are as of this moment i forsee it far more likely that rates will see a decrease before they see a rise. The market agrees with this too, as before stated, a long term CD offer a lower yield than short term.

So being the economist that i am I would agree. The fed will mainly raise rates for 2 reasons which are basically one in the same. That is curb inflation by decreasing the supply of money (note an increase in rates leads to a decrease in demand for money at the same time makes bonds more lucrative (since they now hold a higher yield) effectively enacting a contractuary money supply (but bonds themselves are another way of control, this is a 2nd rate effect.))

ALL that crap said, and understanding that inflation is undercontrol they MAY enact one of there 3 tools (the FED) to make a play at growing the economy. Remember a slight decrease in rates leads to a huge growth in the money supply (it is non linear) because there is a little thing called a reserve ratio which leads to a money multiplier. So the less interest borrowers are paying the more being loaned out obviously. And the ammount being loaned out isn't actually held in the bank only a fractional ammount of it is. For exampled i put $1 in savings the bank can loan out lets say 75% of that. Meaning all they have to do is hold $.25 for me. thus effectively creating money.

Anyways its nice to see a fed chairman that knows what hes doing. He is concentrated on long term goals not short term. He is willing to put the economy through a bit of "hardship" in the short term to create a more stable future"



Will rates go down? its more likely than not
Will it be with in 6 months? Not likely
With in a year? Likely
Will we see 2-3% interest rates soon? I would hope not, and baring unforseen circumstances (something stunting the economy) rates should not go below 3.25%-3.50% in the near future. (5 years)

Highest CD Rate (http://www.bankaholic.com/)

A CD is great you are beating inflation 3% (but its actually decreasing because it is undercontrol) and your making a small profit. Now im not saying a well managed money market account or a 401k aren't better, but a CD is simple for most and involves almost no risk.



BTW for those of you that don't know a 401k is the best way to invest. Your company will usually match funds you put in, yes you can only borrow half of it. But thats nice too since you will always have something left for retirement. Also the greatest part is, if you need money, your paying your self back the interest. Its a win win situation. I encourage as many people as possible to start this early.

/the end

[beowulf7]

varice']Will rates go down? its more likely than not
Will it be with in 6 months? Not likely
With in a year? Likely
Will we see 2-3% interest rates soon? I would hope not, and baring unforseen circumstances (something stunting the economy) rates should not go below 3.25%-3.50% in the near future. (5 years)

Highest CD Rate (http://www.bankaholic.com/)

A CD is great you are beating inflation 3% (but its actually decreasing because it is undercontrol) and your making a small profit. Now im not saying a well managed money market account or a 401k aren't better, but a CD is simple for most and involves almost no risk.



BTW for those of you that don't know a 401k is the best way to invest. Your company will usually match funds you put in, yes you can only borrow half of it. But thats nice too since you will always have something left for retirement. Also the greatest part is, if you need money, your paying your self back the interest. Its a win win situation. I encourage as many people as possible to start this early.

/the end
I completely agree with you about 401(k) investment. If an employer matches, then it's silly to not at least the matched amount, b/c it's like throwing away free money if one doesn't do it. I heard the gov.'t recently passed a law where 401(k) will be an opt-out investment rather than opt-in. In other words, when someone takes a job with a company, after a certain period of time, he'll be automatically invested in the 401(k) (i.e. by default) unless he specifically requests not to do so.

Holy cow, according to your link, Millennium Bank (http://www.mlnbank.com/Services/premCDs.htm[/url) is offering a ridiculous 7.75-9% return for a 5-year CD (rate depends on the min. investment)! :eek: Is that a legit bank that is FDIC?

/the end

[UL]

Holy cow, according to your link, Millennium Bank (http://www.mlnbank.com/Services/premCDs.htm[/url) is offering a ridiculous 7.75-9% return for a 5-year CD (rate depends on the min. investment)! :eek: Is that a legit bank that is FDIC?



Nope its a Swiss based bank, there is no FDIC insurance. Though they claim to only invest in triple A bonds... the reason the reward is higher is because the risk is greater. If you really wanted a higer rate than 5.5% at this moment and you are willing to take some risk. I would suggest buying bonds your self. You can do some research here: http://www.nasdbondinfo.com/asp/bond_search.asp

there are lots of variables to consider but a companys credit rating and your personal out look on a company should influence you.


on a side note i honestly think te XM bonds which yield a high rate of return will be a good investment, although they are at a VERY high risk. But if you have been paying attention to XM financials they are about to hit a break even point where they wont be losing money on every day business. when that happens they will be change there pricing structure and Sirius will have an interesting time competing. Its a very interesting situation but the stock it self has gained 25% in the last few months i think.

Bonds are interesting but do not think you can trade them like stocks if interest rates change the value of your bond changes. Bonds do hold a value like stocks in a way but its pegged against what current interest rates are. So most people invest in bonds for two reasons. 1 is to beat inflation and 2 is to have a cash flow. Remember bonds pay dividends, usually semianually. so it creates a nice cash flow. But you will get taxed on your capital gains... so you have to consider if it would just be cheaper for you to buy a tax free bond.

Tax free bonds are especially enticing to people in higher tax brackets because to guarentee the same yield as a tax free bond a regualr investment must yield a much higher interest rate than current ones. For example a 3% tax free bond vs a 8.5% regular investment yield about the same profit if you are in the upper tax bracket.

theres a simply formula for figuring it out on MSN moeny, if some ones interested in it i can try to find it.

/Cowboys are going to win

[cjm18]

http://bestcashcow.com/

The above website keeps track of which banks have the highest yields on various investments. Forums are attached to explain opinions of the various banks. It's a great website. I chose an online savings account b/c it is way more liquid than CDs. But just read the fine print b/c they are all different. Some only allow a certain number of transactions per year. some require a min balance etc.

[Archaea]

I make about 20% in the stock market per year, and I'm an average joe as far as investor knowledge....CDs are just too low in gains to be valuable...

I have a savings account with Emmigrant direct that is 5.15% and the money is 100% liquid, up to six times per month with no penalties.

[cjm18]

20%? average is 10. what are u putting your money in?

[beowulf7]

I make about 20% in the stock market per year, and I'm an average joe as far as investor knowledge....CDs are just too low in gains to be valuable...

I have a savings account with Emmigrant direct that is 5.15% and the money is 100% liquid, up to six times per month with no penalties.
Yes, I'd also like to know what you're investing in. Maybe in the 1990s, the average investor could earn 20+ % per year in various investments. But even in the "boom market" of the past few years, getting more than 10-12% annually is pretty damn good.

BTW, Emigrant dropped their rate to 5.05%. E-Loan seems to be the best in terms of savings rate at 5.5%. But I haven't opened an account with them ... yet!

[UL]

I make about 20% in the stock market per year, and I'm an average joe as far as investor knowledge....CDs are just too low in gains to be valuable...

I have a savings account with Emmigrant direct that is 5.15% and the money is 100% liquid, up to six times per month with no penalties.

20% this year is good, but what are you pushing over the last few years? I wouldn't always count on this rate of return... i can tell you if you bought GS HPQ MSFT CSCO or berkshire hathaway you are definitely doing well ;)

but im guessing since you made 20% you were in high risk stocks that are classified as growth stocks, not seen as dividend yield. the best dividend yield stock over the years by the has been MO aka Altria the holding company for PM and Kraft. its a nice one.

if you have had consitant growth like this by all means quit your day job, you've figured something out. ;)

/me my favorite CD right now is the GMAC ones. Nice big company to build repor with, especially if you need a loan down the road.

I want to see some Black friday investment deals.... haha

[Archaea]

Guys I go in and out of tech stocks...

ATI(before they were bought out)
Nvidia
Intel
AMD


These companies are cake to make money on and are primarily what I invest in several times each year.

My tax accountant told me I got the whoppe award because I was the only person he worked with that didn't lose money on any trade last year ;)

The trick is that all these companies are strong and aren't going anywhere anytime soon. But for long term investing they suck. Short term however, six months, nine months, 1 year stints they really rock. It all has to do with their product cycles.

New CPU or graphics chipset comes out the stock goes up - usually a bit before it hits the market for consumers, then 3-6-9 months later you sell when it peaks - you make your 15 to 50% and wait for it to cycle back down while their competiitor who you also invested in surges ahead. Being that we are all tech geeks here you have the upper hand of knowing when a new card is coming out before the general public --- it's sorta like insider trading :) - but not illegal!

Take a look at Nvidia, Intel, AMD, ATI's historical charts. You can see a surge for every chipset, every chip they release and then it falls down below where it started months later. The easy investment on these is mid term investment timeframes that you buy at the low point between product cycles and sell whenever it starts dropping.

I truly have made 20% at least the last 3 years....that's when i started investing 2003, so I don't have any data to use before that point. Right now I'm heavy in intel. I bought them at 17, 18, and 19 --- because I knew the core duo 2 was coming a couple months before it was released. I figure they'll hit 27 before their done though they are risin a bit slower than I'd like. I'm watching AMD because the time is fast approching to invest in them again...however -- i'm a bit purplexed by their merger --- it's thrown a wrench in my easy plan because I'm not sure how their next procuct cycle will flow.

THAT being said. ADM and ATI are going to have a good thing going if they can tie up the lower end chipset/motherboad/processor market for laptops espically with vista coming out and requiring directx10/high power graphics cards to use all the bells and whistles.

look for AMD to really fly high ---- I just haven't yet figured out the best time to buy - watch them close.

[cjm18]

nvidia is doing real well. which broker do you use?

[Archaea]

nvidia is doing real well. which broker do you use?

I don't use a broker....

I manage my own funds through scottrade and sharebuilder.