It is Vanguard Prime Money Market, but is not FDIC insured. Historically, money markets have kept their value at $1/share.

When I called Vanguard, they admitted that the money market includes some GSE short term debt. That is why I want to get out of it. Some places many not tell you, but GSE is the most widely held debt. I believe we will have a GSE collapse, and I am not sure if the government can afford a bailout. It is trillions of dollars.

With FDIC insured CD rates at 5.5%, why risk the money market which pays the same or less interest without the guarantee? You can spread out among several banks if you have more than $200K/couple.

Also consider Tbills. They are backed by the government.

This is really cool: Everbank.com is FDIC insured, and you can make FDIC insured deposits into euros and other currencies. A great way to diversify if you believe the dollar will fall (as I do).

doofrat, the stock market is going. We had a sell-off in May, another yesterday, and there will be big correction due to the recession. When earnings go down, you will see a big sell-off. The leading indicators show the economy is turning into a recession. When the leading indicators show the recovery, then get back into stocks.

The only reason that timing stocks doesn’t work for the general public, is because the general public is kind of stupid: they do momentum investing. They pile in when things get really hot, and get scared and sell when the asset is at its lowest. Selling stocks now is selling high. We’ve covered this at length in other threads, and you can find this if you do a search (hopefully).