5 percent on CDs may not be a thing of the past...

**Joan.of.the.Arch** · 09-24-2008, 07:44 AM

"They're trying to say, 'You've heard all this bad news about us but we can pay this, so maybe things aren't as bad as you thought.'"

They seem to be using WAMU primarily as the example in this article. So, the way I read that is not that they aren't as bad as I thought, but that they are declaring they are as desperate for some deposits as I thought. Who wants to do business with a bank that is desperate?

**kork13** · 09-24-2008, 02:20 PM

depends on how long you expect them to last. If you think they'll survive, then great, go for it. If you're less confident in their stability, it's likely that even with a 5% yield, you'd still do better with a 3.75% yield if the bank folds.

My understanding is that your CD would only be FDIC insured for the current value of the CD (not the promised future interest), so if you deposit it today, they fail tomorrow, you could actually be out money.

**ThriftoRama** · 09-25-2008, 05:30 AM

I went to Bankrate.com's CD interest rate chart and it looks like other, more stable banks are also offering higher yields on short term CDs, usually in the 4.5 percent range for a min deposit of $500 or $1000. I am thinking of getting one! Banks are just desperate for deposits right now, because everyone is so broke!

5 percent on CDs may not be a thing of the past...