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> Wealthy people hoard large sums of cash.

I'm curious where you think they put all that currency. You could argue they're hiding it from the tax authorities by putting it in a safe deposit box, but by definition nobody knows how much cash there actually is in those boxes, and of course raising taxes on such cash hoards isn't going to affect such.

> Banks stopped making most of their money from deposits a long time ago.

Consider this advertisement:

https://www.key.com/personal/promotions/dda/200cash.jsp?sqkl...

If banks were not making money from deposits, why are they offering $200 in cash to open a checking account?



Banks make money from charging you for the privilege of using your own money.

Monthly account-maintenance fee. ATM fee. Fee if you don't have direct deposit. Fee for cashing checks. Fee for using a teller. Fee if they process debits before credits so as to push you into overdraft even though, by chronological transaction order, you never overdrafted.

They don't make money by accepting deposits and making loans; they make money by squeezing fees out of people who don't have much money.


Where does my bank make its money then?

https://www.coastcapitalsavings.com/Personal/Banking/Chequin...

Unlimited debit/atm/teller/billpay/cheque/dd/dw transactions, no minimum limit, no requirement for direct deposit (but if you use it, its free too), no monthly fee.


Congratulations, you've got a relatively customer-friendly bank. If you think you can generalize from that to banking in general, you need to read up on what banks in general do these days.


Key bank has free checking and free atm usage and free teller usage. Perhaps you should transfer your checking account there, especially since they're offering $200 for new accounts.

> they make money by squeezing fees out of people who don't have much money

They do make money from people who don't pay attention to their balance - regardless of whether they are poor or not.

> They don't make money by accepting deposits and making loans

That perplexes me since they constantly try to sell me loans.


They do make money from people who don't pay attention to their balance - regardless of whether they are poor or not.

It is unfortunately the case that being poor is much more expensive than being rich. Banks on average know and take advantage of this.




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