Friday, June 12, 2015

I really don't know what this is

Bank's Net Interest Margin for World:

It was almost zero. Then, suddenly, four percent.
Looks like it was zero until 1996, but it was a little above zero. There is data there.

After 1996 it jumps way up, all of a sudden. I don't like big mysterious changes.

See the first word of the series title? Bank's. One bank. Belonging to one bank.

One global bank? That can't be right. In the future, maybe, but not yet. So I don't know what this graph shows.

I did a quick google. Found A Quick Comparison Of Interest Margins For The Largest U.S. Banks from Forbes. Dated 11 September 2014, just a few months back. Here is the opening sentence:
Net interest margin figures for all banks in the U.S. have been on a steady decline over the last three years as a direct result of the low interest rates being maintained by the Federal Reserve since the economic downturn of 2008.

Forbes is worried about a decline that doesn't stand out on the graph. I think they are making an argument without really having one. Their evaluation seems one-sided.

What I want to know is what law was changed, to let that thing jump up so suddenly after 1996?

1 comment:

The Arthurian said...

Maybe it wasn't a law that changed in 1996. Maybe financial regulation relaxed a bit.

From A Short History of Financial Deregulation in the United States by Matthew Sherman, July 2009.