WHERE IS THE MONEY?

Community banks and credit unions are overlooking the largest pool of potential deposits. The largest pool of liquid funds outside of the banking system is Money Market Funds (MMF) at brokerage firms. According to the Federal Reserve Bank of St. Louis, in Q2 of 2024, MMF grow to over $6.5 trillion, an increase of $100 billion from Q1 of the same year. If you wonder where this money came from, just contrast this to the latest FDIC report showing a drop of $197 billion from deposit accounts in Q2 of 2024.

And this is just a preview of what is coming during the rate-cutting cycle we just entered. Remember that you cannot compete with brokerage firms on rates because they are not bound by Net Interest Margin (NIM). If you want to reclaim the deposits shifted from your deposit accounts to MMF, you need to outperform brokerage firms in their game – producing alpha market return.

The main reason for the huge increase in MMF balances in the last few years is the growth of self-directed investors. These are individuals, who are your customers or members, and who invest on their own bypassing investment advisors or money managers. Currently, there are over 100 million self-directed investors with accounts in the six largest brokerage firms.? ?

Shifting money back from MMF to your deposit accounts is now possible with the newly-developed Scientifically Predictable program. The program, which was designed for community banks and credit unions, includes a scientific investing model that is proven to outperform the market with high level of confidence. The scientific study? validates the model is supported by a published scientific study.

Community banks and credit unions that subscribe to the Scientifically Predictable program receive monthly updates to the top five ETFs that are shown to outperform the market with very high level of confidence. The subscribing institution disseminates the Scientifically Predictable monthly projection to customers or members who signed up for the program.

?Everyone wins. Customers and members, who are self-directed investors, can outperform the market with an elevated level of confidence, which they rarely do on their own. Your institution acquires deposits with no impact on interest expenses, which you will need now that lone demand is increasing due to declining rates. Eve5ryone wins by following science.