Apple’s 4.15% Savings Account Marks Golden Age of Cash

https://www.bloomberg.com/news/articles/2023-04-18/is-apple-s-savings-account-worth-it-4-15-is-high-yield-but-has-downsides

by csomar • 3 years ago

27 23 3 years ago

bloomberg.com

ciconia• 3 years ago

https://archive.ph/lJqN5

Temporary_31337• 3 years ago

Super shallow and confusing article. One of the counter arguments for savings account presented in the article is that it’s “risky” because deposits over 250k are not insured. As we have seen with SVB all deposit holders were bailed out even above that limit and in case of Apple account, the entire Goldman Sachs would have to go bankrupt for a similar situation.

I’m curious to see what startups will emerge that will make it more worthwhile (risk/reward) to invest than a stable 4% every year.

I think on the broader stock market some staple stocks like food and oil companies are probably going to outperform the savings rate but not without risk.

uf00lme• 3 years ago

Pretty sure the maximum cash allowed in the account is 250k

alenrozac• 3 years ago

Well, the real interest rate is not 4%, but rather about 1% which is around the historic average tbf.

pdc56• 3 years ago

I vaguely remember _years_ ago, someone, perhaps here on HN but not sure, predicted Apple would become a bank. It seemed insane at the time... from memory it was maybe around 2010 or perhaps earlier.

Does that ring any bells for anyone here? Id love to re-read it and know the exact date

antoinog• 3 years ago

https://hn.algolia.com/?dateRange=all&page=3&prefix=false&qu...

DrStartup• 3 years ago

They aren’t a bank. More like a MVNO but instead of being a mobile carrier they are a value added reseller of a real bank (Goldman Sachs).

senttoschool3• 3 years ago

Until they're big enough to start their own banking license...

lotsofpulp2• 3 years ago

Why does this move indicate they are closer to being a bank? Also, Apple’s profit margins are already much better than a retail bank’s, so why would Apple want to get into that business and be subject to all that extra bureaucracy?

zamnos• 3 years ago

As to why, A) given Apple's lawyers, I'm sure they can structure the deal so as to minimize exposure to regulations for the rest of the empire, and B) they like money. Judging from how much of it they have, they really like money. More to the point though, banking sucks - as did smartphones for a lot of reasons before the iPhone, so if Apple thinks they can make a better product for their customers, they totally would.

Given their inroads into the space already, it's not that far fetched that they wouldn't need to in order to accomplish their goals, simply by co-opting their current partner, Goldman Sachs, which is a bank.

Why this current move moves them closer to being a bank, it means they're now running savings accounts for consumers, which is a very bank-shaped thing to do.

etempleton• 3 years ago

I remember this comment and I think it makes a lot of sense that this is what companies do when they become huge and have excess cash on hand. Apple has a ton of cash and so something like this makes a lot of sense. They can absorb any short-term risk that it may introduce and likely it is structured in such a way that Goldman takes the majority of the risk anyway.

thexumaker• 3 years ago

wealthfront has 4.3% and 3 mil fdic, way better options available.

senttoschool3• 3 years ago

Robinhood is 4.4% an insured by up to $1.5m.

But the Apple option is attractive for those who want to trust a bigger name - even though their money is insured.

yunwal• 3 years ago

Obviously Apple is a big name, but bigger than the FDIC?

reducesuffering2• 3 years ago

Robinhood requires a $5/mth subscription for that rate, otherwise 1.5%.

nly• 3 years ago

More like rusty tin than Gold when inflation is running at 10% YoY

ofcourseyoudo• 3 years ago

Source?

As of March 2023 US inflation was 4.99% the lowest its been in almost two years (since May 2021).

https://ycharts.com/indicators/us_inflation_rate

piepiethesailor• 3 years ago

I think 10% refers to the United Kingdom rate of inflation.

lockhouse• 3 years ago

From your link:

“US Inflation Rate is at 4.98%, compared to 6.04% last month and 8.54% last year. This is higher than the long term average of 3.28%.”

Inflation was 8.5% last year, but even that is misleading because it is based on a cherry picked basket of goods that does not include things like fuel or housing costs.

jprafael• 3 years ago

It seems like there are several options for US persons/USD deposits that achieve similar ~4.5% guaranteed returns. Anything similar for EU/EUR deposits? Even services like revolut that operate on the two jurisdictions and offer multiple currency accounts in both, have very different yield rates.

Apple’s 4.15% Savings Account Marks Golden Age of Cash

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