How The Fed And Trump Are Helping Banks Rob You

[Passages]

Banks just raked in $250 billion by charging borrowers more than they pay depositors. Trump moves could make the scam worse.

National Politics
Mar 6, 2025

You know the subplots from Superman III and Office Space — where scammers skim bits of cash from lots of people, which adds up to tons of money? That’s the kind of heist the Federal Reserve is helping banks pull off, according to new data about net interest income — which is the difference between what banks charge you for loans and what they pay you on your deposits.

Last year, seven large banks reaped more than a quarter trillion dollars by using higher Federal Reserve rates to jack up interest rates on mortgages, auto loans, and credit cards — all while those same banks paid low interest to depositors, according to new letters from Sens. Elizabeth Warren (D-Mass.) and Jack Reed (D-R.I.). One of many examples the lawmakers document: The Fed pays JPMorgan Chase 4.4 percent interest on its deposits, but “customers continue to earn a negligible .01 [percent] on their savings” at JPMorgan Chase.

In all, banks have used this scheme to reap more than $1 trillion in new revenue over a two-and-a-half-year period, according to the Financial Times — and new federal data show net interest income is rising. Read The Lever’s ongoing coverage of the Great Bank Robbery and listen to our podcast episode on the topic.

Banks can deposit your savings at the Fed and get paid 4.4 percent interest, while paying you almost nothing — but unlike banks, you can’t deposit your money at the Fed to get that same rate. The difference between Fed rates offered to banks and bank rates offered to you recently hit “a modern high.” While some countries have taken action against this scam, and proposals for a new U.S. public banking system could combat this problem, Wall Street lobbyists have blocked those initiatives.
https://www.levernews.com/how-the-fed-and-trump-are-helping-banks-rob-you/

[Irish_Dem]

1. It's open season on scamming Americans.

Green light being given to banks and corporations to grift as much as they want.

[Passages]

2. Yes, full speed ahead.