Comment by timcobb
4 days ago
> which sort of implies that marginal profit is negative
Was it not when interest rates were low, like when LIBOR was near zero? My understanding of that era was that many retail banks were working to shed retail deposits. Holding money was not profitable in that era, especially retail. And today I would still suspect it's not what banks are going for big picture.
interest rates being low doesn't mean banks stop making money on retail deposits. there is still a spread between the interest they pay to the account holder and the interest they make loaning out that money.