CD Rate Trends This Week: Dec. 1


Certificate of deposit investors found a predictable, but unfortunate, lump of coal in their holiday stocking this week, as CD rates once again declined across the board.

It would be nice — even refreshing — to point to a cataclysmic economic event and say there is the reason that CDs have fallen off a cliff. But we can’t — it’ s actually more of the same dark, dank and dismal economic conditions that we’ve seen the past 14 months or so.

For those with cast iron stomachs, let’s review the latest "big picture" economic news:

  • The jobless rate is cancerous. The real jobless rate, at 18%, is much more harsh than the 10.2% that the U.S. Labor Department has spoon fed to a compliant media and then to a worried populace.
  • No ray of light for housing. Until 2008, consumers had come to depend on the value of their homes to sustain themselves in retirement. With trillions lost in the housing market, that sentiment has gone out the window.
  • Relentless foreclosures and bankruptcies. Pick a debt, any debt. Whether it’s school loans, car loans, mortgages or credit cards, Americans have never been this far behind on debt payments. That predicament has led to a historic rise in home foreclosures and personal bankruptcies.
  • Poverty levels are looking like 1929. The New York Times (Stock Quote: NYT) reports that one out of every eight Americans and one in every four children are on food stamps.

That’s the environment staring certificates of deposit in the face today.

A look at last week’s numbers, as measured by the BankingMyWay Weekly CD Rate Tracker confirm the bad economic news.

For the week, CD rates are down yet again, and straight across the board. Three- and five-month CDs are down to 0.4% from 0.43%, and to 0.62% from 0.66% respectively. One-year CD rates were down to 0.94% from 0.99%. Two-year CDs fell to 1.39% from 1.44%, while four-year issues slid to 1.89% from 1.92%.

Five-year CDs were no different, sliding to 2.25% from 2.27%.

Who can blame CD investors for waving the white flag? Economists only began tracking CD rates in the early 1980s, but this week’s numbers are comparable to all-time lows.

The only good news last week is that the Federal Deposit Insurance Corp., perhaps taking a Thanksgiving break, didn’t close a U.S. bank last week, although it did say the list of “problem” banks had risen to 552 from 416 from the second quarter to the third quarter of 2009.

That’s the landscape CD investors are navigating these days. If you’re made of sturdy stuff and want a good CD deal, your best bet these days can be found at The CD Rate Search engine can help you dig up the best CD deals out there and there are more than you might think.

It’s a thin reed, but grab it while you can. After all, who says things can’t get any worse?

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at

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