Why the Fed Can't Help Bank of America

In the following video, Motley Fool financial analyst Matt Koppenheffer looks at the misconception that, at the current extremely low interest rates coming from the Federal Reserve at the moment, banks are borrowing at nearly zero, lending with interest, and pocketing the difference hand over fist. In reality, there are ways that low interest rates do generate capital for the banks, but the margins on that lending spread aren't nearly as appealing as many people think they are.

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