Banking Deals of the Week: Feb. 17

The U.S. economy once again seems to be set on a shaky foundation, as the public debt rises just as foreign investors seem to be selling out of U.S. government and corporate bonds.

The U.S. Treasury reports that foreign investment in U.S. Treasury bills fell by $53 billion in December 2009. China gave up its perch as the number one foreign investor in U.S. bonds, selling $34 billion worth of Treasury Bills (now Japan is the number one holder of U.S. public debt).

Sure, you can’t make too much out of one month’s worth of Treasury bills statistics, but it’s worth watching. Why? Because if foreign investors continue to get the yips from Uncle Sam’s rising debt levels, it will put further pressure on the economy and, in the process, keep bank deposit rates down with it. Way down.

The Congressional Budget office estimates that the U.S. government debt will grow to $13 trillion by 2020. To pay for that debt, the government will have to issue Treasury bills to foreign investors at higher interest rates, especially if foreign investors show reduced demand for U.S. investment.

Consequently, we’re starting to see some effects from the exploding debt picture, and they aren’t positive ones for bank interest rate investors.

Bank Checking Accounts

One decent bank deal comes from M&T Bank, which is offering a “Build Your Own Bonus” plan that offers up to $150 for new customers.

Here’s the deal. All you need to do is open a new M&T checking account, then you can earn the bonus on a piece-by-piece basis.

  • Open a direct deposit account and earn $100 right off the bat.
  • Add overdraft protection to the checking account and earn another $25.
  • Add M&T’s Web Bill Pay service and earn another $25.

You can apply online here or call (866)878-0329.

Bonuses will be made to the account via direct deposit and those bonuses will be reported to the Internal Revenue Services for tax purposes.

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