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Suspending Money Market Redemptions Is Now Legal
Zero Hedge ^ | 1/27/10 | Tyler Durden

Posted on 01/27/2010 2:23:13 PM PST by thought

...in a nearly unanimous vote, Money Market Funds now have the ability to suspend redemptions, courtesy of the SEC's just passed 4-1 vote. This explains the negative rate on bills: at this point, should there be another meltdown, money market investors will not, repeat not, be able to withdraw their money purely on the whim of Mary Schapiro. As the SEC noted: "We understand that suspending redemptions may impose hardships on investors who rely on their ability to redeem shares." Too bad investors' hardships considerations ended up being completely irrelevant.

(Excerpt) Read more at zerohedge.com ...


TOPICS:
KEYWORDS: economy; moneymarkets; savings
Better find a new safe place for your money.
1 posted on 01/27/2010 2:23:15 PM PST by thought
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To: thought

Suggestions ...


2 posted on 01/27/2010 2:25:01 PM PST by Tarpon ( ...)
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To: thought

too late


3 posted on 01/27/2010 2:27:36 PM PST by novemberslady
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To: Tarpon

Gold.

Deposited in Hong Kong.


4 posted on 01/27/2010 2:28:19 PM PST by Unrepentant VN Vet (1088 and a wakeup)
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To: thought

Ani’t no such thing with 0.


5 posted on 01/27/2010 2:28:32 PM PST by Drill Thrawl (Another day, another injury, another step closer. Are you prepared?)
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To: thought

Investors must then be aware of what securities their money market invests in. This was triggered by the failure of a single money market fund to sustain a Net Asset Value of $1.00, causing an electronic run on the bank. Funds that invest exclusively in primary government paper such as Treasury instruments, won’t be allowed to fail because the Federal Reserve will be called upon to support the liquidity of those instruments.

This means that corporate Treasurers and cash management operations that deal in a lot of money will have to broadly diversify the accounts and institutions they use. Nobody wants to come to payday and not be able to cash their check.


6 posted on 01/27/2010 2:31:20 PM PST by theBuckwheat
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To: thought

One more little drip, drip, drip of the coming disaster.


7 posted on 01/27/2010 2:34:20 PM PST by La Lydia
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