On the first day of the second quarter, investors are shrugging off bad news from the financial sector and are accentuating the positive. Is the worst really over?

Deutsche Bank headquarter

TalkBack: Is it foolish to buy bank stocks now?
Wait..there's more! Goldman Sachs slashed its earnings estimates on Citigroup (C, Fortune 500) and Merrill Lynch (MER, Fortune 500) Tuesday morning due to expectations of more credit writedowns. And Morgan Stanley analysts in London wrote in a report that "the industry is facing the most severe investment banking crisis in 30 years." Ouch!

But I'm sorry. Did I say it was a gloomy day for banks? April Fool! For some reason, investors are treating this latest round of bad news as a good sign...a possible indication that the worst may soon finally be over for the beleaguered financial services industry.

The Reserve Bank has expressed confidence in the Australian financial system.

The Reserve Bank has reiterated its confidence in the Australian banking system, while acknowledging that the situation will remain challenging in the near term. Governor Glenn Stevens also commented on the situation in the US, where investment bank Bear Stearns has been propped up by the Federal Reserve.

Glenn Stevens, the governor of the Reserve Bank of Australia (RBA), has commented on the currently turbulent financial markets. Although Mr Stevens acknowledged that Australian banks are facing many challenges, he asserted that the Australian banking system is prepared to weather the storm. Funding has become more expensive for Australian banks due to the global credit crisis, but it has not dried up altogether.

Discouraged by the yields on CDs these days? It's time to check out high-yield checking accounts.

Average yields* for three-month, six-month, and one-year CDs are, according to Bankrate surveys, 2.34 percent, 2.48 percent and 2.43 percent, respectively. Not much of a deal when inflation, by some estimates, is in the 4-percent neighborhood.

Even high-yield CDs are showing wear and tear from the economy. It's difficult to find many CDs paying 4 percent or better on Bankrate's High Yield CD page. CDs certainly deserve a spot in your portfolio if you have a ladder or funding need that requires locking a rate for a specific period of time. But if you can forgo the guaranteed rate, you'll find some excellent deals in these challenging times.

March 28 -- Citigroup Inc. hired Terri Dial from Lloyds TSB Group Plc to lead the bank's U.S. consumer unit and replaced the co-heads of prime brokerage, extending a management reshuffle following Vikram Pandit's appointment as chief executive officer.

Dial, 58, has overseen U.K. consumer banking for London- based Lloyds TSB, which announced her departure in a statement today. A person close to Citigroup confirmed that she is joining the New York-based company. Nick Roe, 42, who runs Citigroup's prime brokerage in Europe, will replace the departing co-heads of the business, Ali Hackett and Tom Tesauro, according to a memo from Steve Bowman, the bank's hedge fund services chief.

Pandit, who succeeded Charles O. ``Chuck'' Prince in December, has already promoted John Havens, 51, to oversee the bank's securities unit and named new heads of risk management and administration. Citigroup is reeling from $20 billion of writedowns that helped wipe out more than half of its market value in five months.

The operation of checking accounts is governed by state law supplemented by federal law. Article 4 of the Uniform Commercial Code, which has been adopted at least in part in every state, "defines rights between parties with respect to bank deposits and collections."

Until the early 1980's interest rates on bank accounts were regulated by the national government. A ceiling existed on interest rates for savings accounts. Interest payments on demand deposit accounts were generally prohibited. Banks were also prohibited from offering money market accounts. The Depository Institutions Deregulation Act of 1980 eliminated the interest rate controls on savings accounts. The restrictions on checking and money market accounts were lifted nationwide by the DIDRA (by the authorization of NOW and Super NOW checking accounts) and the Garn-St Germain Depository Institutions Act

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