Cyberkayu
:
bank make money from loan interest, cut interest means less income. Yet, due to interest cut, businesses will see the cost of lending money is lower, may end up getting more loan from banks to expand.
Cyberkayu
Cyn diamond
OP
:
It takes times for business or home owner to take loan, besides the typical paperwork of mortgage, collateral, credit check n others regulations. So short term drop, long term gain.
But at the same time, bank pay lesser interest to saving and FD account, so kind of balance it out their overhead too.
Cyberkayu : bank make money from loan interest, cut interest means less income. Yet, due to interest cut, businesses will see the cost of lending money is lower, may end up getting more loan from banks to expand.
Cyn diamond OP Cyberkayu : So the bank makes money both ways. So feds cut rates will not cause bank stocks to fall?
Cyberkayu Cyn diamond OP : It takes times for business or home owner to take loan, besides the typical paperwork of mortgage, collateral, credit check n others regulations. So short term drop, long term gain.
But at the same time, bank pay lesser interest to saving and FD account, so kind of balance it out their overhead too.