{"id":1401,"date":"2011-10-19T14:23:15","date_gmt":"2011-10-19T18:23:15","guid":{"rendered":"http:\/\/goldstocksforex.com\/?p=1401"},"modified":"2011-10-19T14:23:15","modified_gmt":"2011-10-19T18:23:15","slug":"a-year-later-everyone-is-catching-on-about-fed-policy-and-net-interest-margins-credit-writedowns","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2011\/10\/19\/a-year-later-everyone-is-catching-on-about-fed-policy-and-net-interest-margins-credit-writedowns\/","title":{"rendered":"A year later everyone is catching on about Fed policy and net interest margins | Credit Writedowns"},"content":{"rendered":"<p>&#8220;As I wrote in April: <em>If long rates are largely determined by expected future short rates, the longer short rates are at zero percent, the lower long rates will go. That&#8217;s toxic for bank interest margins&#8230;..<\/em><\/p>\n<p>Now that we are seeing more movement down on net interest margins (BofA and Wells Fargo both showed margin compression for example), the mainstream media is finally catching on to the connection between Fed policy and net interest margins. You heard it here first though.&#8221;<\/p>\n<p>via <a href=\"http:\/\/www.creditwritedowns.com\/2011\/10\/net-interest-margins.html\">A year later everyone is catching on about Fed policy and net interest margins | Credit Writedowns<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;As I wrote in April: If long rates are largely determined by expected future short rates, the longer short rates are at zero percent, the lower long rates will go. That&#8217;s toxic for bank interest margins&#8230;.. Now that we are seeing more movement down on net interest margins (BofA and Wells Fargo both showed margin &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/thepatientinvestor.com\/index.php\/2011\/10\/19\/a-year-later-everyone-is-catching-on-about-fed-policy-and-net-interest-margins-credit-writedowns\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;A year later everyone is catching on about Fed policy and net interest margins | Credit Writedowns&#8221;<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[31],"tags":[459,1352,2438,2827,2831,3665],"class_list":["post-1401","post","type-post","status-publish","format-standard","hentry","category-the-fed-banks-interest-rates","tag-bofa","tag-fed","tag-net-interest-margin","tag-qe","tag-quantitative-easing","tag-wells-fargo"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>A year later everyone is catching on about Fed policy and net interest margins | Credit Writedowns - the patient investor<\/title>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A year later everyone is catching on about Fed policy and net interest margins | Credit Writedowns - the patient investor\" \/>\n<meta property=\"og:description\" content=\"&#8220;As I wrote in April: If long rates are largely determined by expected future short rates, the longer short rates are at zero percent, the lower long rates will go. That&#8217;s toxic for bank interest margins&#8230;.. 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When the spread between long-term Treasury yields and short-term rates is\u00a0 below zero, net interest margins are squeezed. In a normal market, with a steep yield curve, net interest margins are wide\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":14233,"url":"https:\/\/thepatientinvestor.com\/index.php\/2016\/09\/24\/flattening-yield-curve-low-bank-interest-margins\/","url_meta":{"origin":1401,"position":1},"title":"Flattening yield curve &#038; low bank interest margins","author":"ColinTwiggs","date":"September 24, 2016","format":false,"excerpt":"The Yield Differential, calculated by subtracting 3-month from 10-year Treasury Yields, is trending lower. This warns that the yield curve is flattening but we are still above the danger area below 1.0 percent. A flat yield curve squeezes bank interest margins and often precedes a credit contraction. But there is\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1395,"url":"https:\/\/thepatientinvestor.com\/index.php\/2011\/10\/18\/wells-fargos-margin-slips-wsj-com\/","url_meta":{"origin":1401,"position":2},"title":"Wells Fargo&#8217;s Margin Slips &#8211; WSJ.com","author":"ColinTwiggs","date":"October 18, 2011","format":false,"excerpt":"At Wells Fargo, based in San Francisco, net interest margin fell to 3.84%, the fourth consecutive decline. Wells Fargo blamed the problem on its inability to lend enough of the deposits pouring into the bank. The decline overshadowed a 21% jump in third-quarter net income, which rose to $4.1 billion,\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":14769,"url":"https:\/\/thepatientinvestor.com\/index.php\/2017\/02\/06\/a-bump-for-donald-trump-next-year\/","url_meta":{"origin":1401,"position":3},"title":"A bump for Donald Trump next year","author":"ColinTwiggs","date":"February 6, 2017","format":false,"excerpt":"From Tim Wallace at The Age: Nine years on from the start of the financial crisis, the US recovery may be overheating, Legal & General Investment Management economist James Carrick has warned. He has predicted a series of interest rate hikes will tip the US into a 2018 recession.\"Every recession\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":22587,"url":"https:\/\/thepatientinvestor.com\/index.php\/2020\/11\/11\/low-interest-rates-no-free-lunch\/","url_meta":{"origin":1401,"position":4},"title":"Low interest rates: No free lunch","author":"Colin Twiggs","date":"November 11, 2020","format":false,"excerpt":"Total assets of commercial banks in the US spiked up by $2.5 trillion (T) in the three months ending April 2020. Since then, total assets have contracted slightly (-$117bn) but, while total assets have hardly changed, this hides some far sharper changes in the composition. Consumers Consumer loans fell sharply\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":4526,"url":"https:\/\/thepatientinvestor.com\/index.php\/2012\/06\/03\/us-banks-face-squeeze\/","url_meta":{"origin":1401,"position":5},"title":"US banks face squeeze","author":"Colin Twiggs","date":"June 3, 2012","format":false,"excerpt":"Rising short-term interest rates (represented by 3-month Treasury yields on the chart below) caused negative yield differentials in 2006\/2007 which led me to warn of an economic down-turn. Yield differentials are calculated by subtracting short-term (3-month) yields from long-term (10-year) yields. 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