Federal Govt. to Banks: Loan to Small Businesses

U.S. regulators on Friday again reminded banks that they should extend loans to creditworthy small businesses.

Per Reuters:

In an interagency statement, regulators said supervisors will not criticize banks for extending such loans, as long as they have done a thorough review of the small business's financial condition.

Banks have argued that they are getting mixed messages with supervisors telling them to build their capital positions and policymakers telling them to increase lending.

"Regulators are mindful of the harmful economic effects of an excessive tightening of credit availability in a downturn and are working...to ensure that supervisory policies and actions do not inadvertently curtail the availability of credit to sound small business borrowers," the statement said.

Will More Banks Fail in 2010?

Bank failures have been an unfortunate fallout of the current economic situation - 2009 saw even more banks fall.

Check out the video interview below with FDIC head Sheila Bair. She addresses the issue and what some of us can expect as the current year unfolds.

Shopping for a CD: Be Informed, Be Safe

With many investments in the stock market or real estate declining in value, certificates of deposit (CDs) remain some of the safest and most reliable places for your money. But as with most financial products and services, it pays to do some research and take other precautions before you buy. Check out this video from the FDIC:



You can get great CD Rates from FDIC banks at MoneyAisle.com.

Move Your Money?

A new movement that's gaining online popularity is Move Your Money. Move Your Money urges customers of large banks to move their business (and money) to smaller community banks.

"The response has been dramatic," Huffington Post creator Arianna Huffington told ABC News. "Over half of the zip codes in the country have already been searched for a local bank, and people are really eager to move beyond anger and frustration into action."

One woman, Stephanie Frost, created a youtube video of the big moment:



What do you think? Do you plan on moving your money? One way to find community banks is by using the MoneyAisle network of over 100 community banks, all willing to give you great rates on deposit accounts. Check it out.

Will Interest Rates Rise in 2010?

Short answer: Not bloody likely.

Long answer: As this article explains, part of the Fed's plan for rescuing the failing banks is keeping interest rates down, giving them low loan rates on our deposits. Unfair? Sure, but most of the bailout could be described that way.

The practical answer: if you're looking for amazing returns on your CDs or savings, you're going to need to keep waiting. You can still get good rates using online tools such as MoneyAisle, but we're a ways off from seeing interest rates rise in 2010. Hopefully we can reassess as we get further into 2010.

What do you think?

Happy New Year from MoneyAisle

MoneyAisle would like to wish everyone a safe and happy New Year.

We've got some amazing things coming up in 2010. I can't wait to tell you about them.

Thanks for reading.

GMAC may receive 3rd round of bailout funds

GMAC is close to receiving a third round of bailout funds from the Treasury Department, according to a published report today.

The announcement for GMAC to collect an additional $3.5 billion in aid on top of the $13.5 billion already received is expected shortly, the Wall Street Journal reported.

"As we have previously stated, GMAC has been conducting a strategic review of its business and evaluating options to address the challenges at ResCap and the mortgage operations," said GMAC spokeswoman Gina Proia in a statement. "Critical objectives in the process would be to take actions that position GMAC for improved financial performance and to repay the U.S. government."

FDIC in the News

According to the New Jersey Star-Ledger, the FDIC "needs more money in case any large institutions fail next year. So it is requiring banks to prepay three years of insurance premiums by the end of this month."

This is having an effect on smaller community banks, who "could restrict how much banks can offer on certificates of deposit and limit the dividends and share price appreciation of publicly traded institutions, according to community bankers in New Jersey."

This while, according to Reuters, backing a deal for City National Corp to buy the banking operations of failed lender Imperial Capital Bank.

Late on Friday, City National said it bought about $3.4 billion in assets and about $2.2 billion of deposits from Imperial Capital, through a loss-sharing agreement with the FDIC.

City National would not need to raise capital in relation to the Imperial Capital deal, a company executive said on a conference call with analysts.

Holiday Savings: More Tips and Tricks

Yes, 'tis the season... to spend more money than is reasonably necessary. Luckily, MoneyAisle is here to pass along some of the tips and tricks we've found to make your yuletide rocking without having to declare bankruptcy afterward.

The New York Daily News has 10 awesome tips to help you save big on travel this holiday season:

4. Buy before you fly. There are no rules against bringing snacks through security, as long as they are solid (no liquids). Many airlines charge for inflight snacks, so to avoid the added costs hit the store before you head to the airport. Good travel snacks include granola bars, dried fruit, vegetables (carrots and celery sticks travel well and don’t need refrigeration) and candy. You can buy bottled water once you clear security or bring an empty water bottle to fill up before you get on the flight.

Meanwhile, if you're still shopping... Forbes lets you know Where the Deals Are:

Then there's the old standby used to lure consumers during the holidays: free shipping. Many big chains are offering it for online orders that meet a certain minimum, generally $50 or $100. But move fast--most special shipping orders end by Dec. 18, according to a recent survey by Shop.org, the digital arm of the National Retail Federation.

What are YOU doing to save this holiday season?

Cash the Hot Holiday Gift?

We're noticing a new trend regarding holiday gift-giving this year.

More folks are asking for cash, CDs and savings accounts instead of your standard gifts. Honestly, given the choice between another stale fruitcake and stocked high-yield savings account, I know what I'd choose at a Yankee swap.

Retail analyst Marshall Cohen says the wish for cash is due to the troubled economy. People are putting bills above anything on their holiday wish lists.

One credit union in Massachusetts opened at 5 a.m. on Black Friday. They offered a 3-month CD with 10% interest!

According to a survey by Western Union, over 44 percent of consumers say that they plan to give money as a gift this year.

If you still think giving cash is gauche, here's another idea: