April 21, 2024

Taylor Daily Press

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Can banks resist calling for higher savings rates for long?  To ask a question is to answer it

Can banks resist calling for higher savings rates for long? To ask a question is to answer it

dear reader,

We can’t ignore it, the savings account has been a hot topic this week. Especially the low interest rate on our savings. The prime interest rate is now over three percent, and only half is still on our savings account. While economist Paul de Grauy has long argued that this makes banks sleep rich at taxpayers’ expense, even Pierre Winch, governor of the National Bank, has now joined the bandwagon. He also believes that interest rates should go up.

There is a call for the government to introduce a mandatory increase in savings benefits. But the banks are on the brakes and vehemently refuse to do so. They give two reasons why it is not obvious to raise interest rates without getting into trouble: the many loans owed over the past 10 years at low interest rates and the high taxes that banks have to pay on the interest rates they pay. you pay. in savings accounts. Can banks withstand this pressure for a long time? To ask a question is to answer it.

But this may take some time. What can you do in the meantime to increase your savings? You can consider a foreign savings account, where interest rates in some cases are much higher than in our country. But this runs into practical difficulties. For example, you often need an address in the respective country. And since taxes for non-residents are often higher, there is a risk that you will end up not being any better off than in Belgium. Another option is the so-called ETFs, which are stocks that track an entire stock market index. They are often seen as a safe haven because they are highly diversified and – and continue with the past – guarantee the highest returns in the long run.

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Another thread that didn’t seem to fill in the news last week: decreased growth. In short, this means that in some economic sectors and regions, economic contraction should be chosen over sustained growth in order to save the climate. The whole debate erupted after Annona de Wever intervened in the European Parliament.

But it seems to remain a mainly theoretical test balloon, which seems impractical in practice. In its most extreme form, it will lead to more poverty. China is the best example of how economic growth has lifted hundreds of millions of people out of poverty in recent decades. But there is no doubt that from now on, this growth must be based on an environmental basis.

Alas for those who envy it, it could be a historic weekend for Antwerp fans: for the first time in 66 years, The Great Old can win the national title in football. So you should beat Al Ittihad on Sunday. So tickets of up to a thousand euros are offered on the black market. Anyone considering putting their ticket up for sale should think twice: If you get caught, you risk a fine of up to €60,000.

until next week,

Dimitri Tgeskins

Economic journalist