The Fed today made a special exemption and allowed GMAC to become a bank holding company, giving it access to TARP funds. Just last week, GMACs application to convert was denied by the FDIC n the grounds that it did not have enough capital. GMAC tried to sell bonds backed by auto loans but investors wouldn't bite, worried about the quality of the underlying loans and a surge in defaults by car buyers.

That means that GMAC bank customers do not have to worry about the hassle of the parent company defaulting. While the parent company was not a bank holding company, GMAC bank was and still is a bank and deposits were fully covered by FDIC insurance. The change in status of the parent company means extra stability for the bank and its depositors.

GMAC Bank has been extremely competitive with rates lately. It currently has the top 6 month, 1 year, 18 month, 2 year, and 3 year Certificates of Deposit rates. It will remain to be seen if the change in its parent company and the injection of TARP funds will lead it to lower its consumer deposit rates.

Last July I compared bank failures in 2008 to bank failures during the S&L Crisis in the late 1980s. At the time, Indymac has just failed and many hoped the banking system would stabilize. Then came Fannie, Freddie, Lehman, AIG, WaMu, Wachovia, Citi, Merrill...

The data now shows that the financial crisis far exceeds anything that occurred in the 1980s.

While there have only been 24 failures so far, they have accounted for $341,000,000,000 in assets, far above the $164,000,000,000 in assets for failed banks in 1989. Consolidation has played a big part of this. There are 50% fewer banks today than there were 10 years ago. By any measure, this banking crisis is much more massive than what happened in the late 1980s.

This credit crisis has also impacted the biggest of the financial institutions. Many of the biggest banks took enormous gambles on mortgage related securities and held assets that turned toxic once the mortgage market turned down. When the best turned bad, these toxic assets dwarfed their capital, leading to rating downgrades, which led to investor and depositor flight, which led to insolvency. Leverage can create enormous gains in good times but it can also result in staggering losses in bad times. Big banks, which previously seemed like pillars of stability in bad times were swept away.

A look at the charts shows that in the 1980s, bank failures did not spike in one year and then come back down, but rather remained elevated for an extended period from 1988 - 1993. It's possible that the TARP will prevent further bank failures but don't count on it. Treasury Secretary Paulson said that the TARP was not meant to rescue every bank. With real estate values continuing to fall, I imagine we'll see the FDIC setting up more shotgun bank marriages a la WaMU/Chase and Wachovia/Wells Fargo in 2009. Who the government will let live and who will be allowed to go under will be an interesting policy question for the new administration.

This data was taken from the FDIC's failed bank list. The list includes Washington Mutual, which was purchased in distress by JP Morgan Chase. But it does not include Wachovia, purchased under similar circumstances by Wells Fargo or Countrywide, acquired by Bank of America.. It also doesn't include Citigroup, which would have failed were it not bailed out by the government or any of the non- FDIC regulated financial companies that were bailed out, that failed, or were purchased in distressed condition - Fannie Mae, Freddie Mac, AIG, Lehman, Bear Stearns, Merrill Lynch. Even without the inclusion of these institutions, it's clear that 2008 will be a year that the banking world will be happy to put behind.

The Fed cut its Fed Funds rate to 0-.25% yesterday but there are still some very attractive savings and CD rates. Get them before they are gone.

These rates include:

• DollarSavingsDirect is offering a 4% APY Savings account with no minimum deposit.

• EverBank is offering a checking account with a guaranteed 3 month bonus rate of 4% APY and a first year APY of 3.42%. In addition, BestCashCow readers receive $40 when they open the account using this link and fund the account with $40,000 or more. In one sense, the 3 month bonus is like a liquid 3 month CD. At 4% APY it would be the highest rate by over 70 basis points. Another bonus of Everbank, they were one of only a handful of banks that actually saw their Bauer rating for financial stability and solvency increase over the last quarter. Everbank has told us that the rate will only last through the year. They will be lowering rates in January.

• A five year CD from Chase/WaMu paying 5% APY.

There are many other savings, money market, and CD accounts that are paying well above the national averages.

Rates are falling and banks have indicated to us that they will fall further over upcoming days and weeks. But as chart below shows, savings and CD rates have held up incredibly well despite several rounds of Fed rate cuts. Why? Because there is competition for your money and banks needs your deposits to fund their operations and stay solvent.

We expect rates to fall but if this trend holds anticipate top savings, money market and CD rates will not approach 0%, but rather come down to the 3-4% range. Still, if you have money that you want to invest in an FDIC insured account, now is a good time to look into opening an account.

• View the top CD Rates
• View the top money market and savings account rates.