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Old 09.10.2008, 08:59
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Re: How Safe is UBS

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Never really understood how these small rate changes can effect anything. Always seemed to me akin to a witch doctor throwing chicken bones over their shoulder. More of a religion based belief than actually measurably impacting real life
The "man in the street" seems to be happy to pay 15/20% interest on credit card debts & these rate changes never seem to have a leverage effect on the credit card interest rates; I mean a 0.5% rate cut should translate into a 4 or 5% cut in credit card interest rates.

For example SNB cut their rate today but nobody else (like mortgage or credit card companies or loan companies) has announced any cuts; they just put the difference in their pockets. How does this help?

You are right. The "man in the street" does not benefit. That man should pay more taxes so that the big private financial institutions can be supported.

These wholesale rate changes only benefit the large institutions. They can borrow money cheaper from the National Bank. They could pass the benefits to the retail borrower. Most probably they prefer to use the cheaper funds for other more lucrative purposes.
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