So the idea that retail depositors won't chase higher rates is saying that retail depositors don't care how much it costs to park cash in a bank, which seems absurd to me. 100bps would certainly be enough for me to move my savings around annually, given that ACH transfers are nearly free.
Welcome to a global economy with imbalanced trade. Export surpluses leave the exporting nation with too much foreign currency while simultaneously draining the industrial base of the importing country. If the exporting nation invests their money into the stock or housing market they are exposing themselves to a bubble, if they just hold onto the money they avoid the risk.
Are they not completely free to the ACH end user? Unless you are referring to an indirect cost of the transfer time? I've never had to pay a fee for ACH.
As a result I intentionally have 0 cash savings. Enough to live on for 2-3 months in my checking account, plus I have available credit for emergencies, everything else goes into assets I can expect to appreciate in high single digits worst case. If anything I feel like most people have a much less aggressive allocation than they can probably afford to (although I also have little debt, just a car loan, and a relatively low cost of living which makes this easier)