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Author: imdajunkman Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35344  
Subject: “Superior” Savings, a Final Time Date: 3/1/2006 1:07 PM
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When a search is done at www.bankrate.com for the 100 highest yielding MM accounts in the country, a list of 36 institutions is returned (03/01/06). The yields range from 4.80% to 0.75% (APY). As can be seen below, Superior Savings has now fallen to mid-pack status, which is what I predicted would happen.

It didn't take rocket science to make that prediction, just a bit of common sense and market experience. I'm wrong about a lot of things, and I make a lot of mistakes. But the yield that Superior was offering back in January and the circumstances of the offering were just too anomalous not be a warning sign.

I did a long write up [Post 14,732], because I knew that Superior's offer should not be accepted. Anyone who was foolish enough to ignore my warnings and who deposited money with Superior is now receiving inferior returns. That is underperformance that could have been avoided.

Yes, no one should ever invested on the basis of “tips” no matter how authoritative the source. But when an argument is laid out in full detail and cannot be refuted, then its conclusions have to be accepted. I laid out the argument, and no one was able to refute me. A couple of idiots attempted refutations, but you can judge for yourself the merits of their arguments and the value of their conclusions. They were wrong about an easy and obvious case. How likely is it that they will have anything worthwhile to say about the subtle or difficult ones?

I'm am not being gracious about this for good reasons. Investing success isn't a matter of democracy or conventional “wisdoms”. Success requires independent thinking. It requires the imagination to make forecasts and the courage to execute on those forecasts. Gaming Superior was trivial. But some of you got it wrong, and some of you sided with the people who got it wrong. Now ask yourself this:

Who was the Fool, and who were the fools?

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The first number is the APY. The second is the number of institutions. The lines suggest groupings:

4.80% (1)
------------------
4.65% (1)
4.60% (5)
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4.50% (2) <= this is where Superior is now positioned
4.49% (2)
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4.35% (1)
4.30% (1)
4.29% (1)
4.26% (1)
4.25% (5)
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4.05% (1)
4.01% (1)
4.00% (4)
3.99% (1)
3.98% (2)
----------------------
3.84% (1)
3.80% (1)
3.65% (1)
3.58% (1)
3.55% (1)
3.20% (1)
1.50% (1) <= This really should be excluded from the data set.
0.75% (1) <= As, also, this. But I report what BankRate reports. I don't fudge my data. I evaluate it and attempt the best forecast I can.
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