You know it’s a good sign when banks are like, “No, no, we aren’t interested in taking your piles of money.”
Sounds like we’ve got a robust and healthy economy going to me.
This can be blamed totally and completely on the planners at the Federal Reserve and other federal regulators. Cash is now a liability for the big banks. The world according to the Wall Street Journal is “awash in cash.” And yet much of America remains cash strapped. This is a bizarre and fascinating economic era we are living through that is for sure.
Bottom line, banks don’t want (some) dollars. Yet another warning in the series of warnings we’ve been given over the last 6 months or so.
(From The Wall Street Journal)
U.S. banks are going to new lengths to ward off a surprising threat to their financial health: big cash deposits.
State Street Corp., the Boston bank that manages assets for institutional investors, for the first time has begun charging some customers for large dollar deposits, people familiar with the matter said. J.P. Morgan Chase & Co., the nation’s largest bank by assets, has cut unwanted deposits by more than $150 billion this year, in part by charging fees.
The developments underscore a deepening conflict over cash. Many businesses have large sums on hand and opportunities to profitably invest it appear scarce. But banks don’t want certain kinds of cash either, judging it costly to keep, and some are imposing fees after jawboning customers to move it.
The banks’ actions are driven by profit-crunching low interest rates and regulations adopted since the financial crisis to gird banks against funding disruptions.