Skip to comments.Money-market funds are a most dangerous investment
Posted on 03/29/2013 10:17:18 AM PDT by Zakeet
Money-market funds, thought to be one of the safest investments, are actually some of the most dangerous. They are still vulnerable to the same kind of bank run that nearly pushed the global economy over the brink in 2008, and theres no plan by the industry or by its regulators to fix that vulnerability.
The money-market funds are smaller than they were in 2008, but if anything, they are riskier. Current U.S. law prohibits the kind of federal guarantee that, in 2008, stopped the bank run before it could bring down the financial system. The next run on these shadowy bank-like institutions could be fatal.
(Excerpt) Read more at marketwatch.com ...
You don't need to worry ... cause we manage banks just as well as we manage America's finances ... and we probably won't confiscate your money for a little while yet ... and if we do, you can always borrow it back at interest from one of the banks we control!
For what it is worth, you don't need to worry about the FDIC guaranteeing your bank deposits either ... cause they've got about $25 billion in cash backstopping about $2 trillion in deposits ... and the banks only have an exposure of $350 trillion or so in derivatives ... and the Fed can always print a ton of money if they have to ... and you can get it in a few months ... and that won't cause the value of your cash to crater ... too much ... for a little while!
I always heard, if you ever see a money fund drop below $1, buy as much as you can because it will pop back up to $1. I guess that doesn’t still hold true.
bookmark for later
MM Funds ustah pay a bit more than a savings acount.Now that they are equal may as well go for FDIC for that added sence of insecurity.
I have gone with an ultra short bond fund.
It must be time to invest in green companies. LOL when the government goes there isn’t a safe haven outside of the hard goods you hold.