Money Market Account Safety Question?

[eikoph]

I think your concern is not misplaced. Back in September, I switched money from a money market fund that had somewhere between 8-20% exposure to mortgage backed securities and/or collateralized debt obligations, to a money market fund that was solely invested in US Treasuries (the Vanguard fund mentioned in a reply above). The New York Times article below explains the risk that normally "safe" money market funds are facing and that many will likely require bail-outs to prevent them from "breaking the buck".

Investor Safe Haven Becomes a Concern, New York Times, Nov 14

[kev374]

Why would you use a money market when you can get a better interest rate in a high yield savings or a CD which is FDIC insured. Countrywide bank is offering 5.45% now on it’s 3 mo. CD. and you can lock in at least 5.35% for 6 mos.

[kev374]

Why would you use a money market when you can get a better interest rate in a high yield savings or a CD which is FDIC insured. Countrywide bank is offering 5.45% now on it’s 3 mo. CD. and you can lock in at least 5.35% for 6 mos.

[kev374]

Why would you use a money market when you can get a better interest rate in a high yield savings or a CD which is FDIC insured. Countrywide bank is offering 5.45% now on it’s 3 mo. CD. and you can lock in at least 5.35% for 6 mos.

[kev374]

Why would you use a money market when you can get a better interest rate in a high yield savings or a CD which is FDIC insured. Countrywide bank is offering 5.45% now on it’s 3 mo. CD. and you can lock in at least 5.35% for 6 mos.

[kev374]

Why would you use a money market when you can get a better interest rate in a high yield savings or a CD which is FDIC insured. Countrywide bank is offering 5.45% now on it’s 3 mo. CD. and you can lock in at least 5.35% for 6 mos.

[cooperthedog]

One reason to use a MM is accessibility & no penalties for early withdraw. I assuming most people use a MM in a brokerage account inbetween investments/trades, including IRA’s, and do not want their money tied up.

With that said, the yield on those CD’s are great, especially considering the looming rate cut.

It also shows the desperation for funds that CFC is offering such a high rate, of course its better than paying 11% and it doesn’t convert into equity… 🙂

[cooperthedog]

One reason to use a MM is accessibility & no penalties for early withdraw. I assuming most people use a MM in a brokerage account inbetween investments/trades, including IRA’s, and do not want their money tied up.

With that said, the yield on those CD’s are great, especially considering the looming rate cut.

It also shows the desperation for funds that CFC is offering such a high rate, of course its better than paying 11% and it doesn’t convert into equity… 🙂

[cooperthedog]

One reason to use a MM is accessibility & no penalties for early withdraw. I assuming most people use a MM in a brokerage account inbetween investments/trades, including IRA’s, and do not want their money tied up.

With that said, the yield on those CD’s are great, especially considering the looming rate cut.

It also shows the desperation for funds that CFC is offering such a high rate, of course its better than paying 11% and it doesn’t convert into equity… 🙂

[cooperthedog]

One reason to use a MM is accessibility & no penalties for early withdraw. I assuming most people use a MM in a brokerage account inbetween investments/trades, including IRA’s, and do not want their money tied up.

With that said, the yield on those CD’s are great, especially considering the looming rate cut.

It also shows the desperation for funds that CFC is offering such a high rate, of course its better than paying 11% and it doesn’t convert into equity… 🙂

[cooperthedog]

One reason to use a MM is accessibility & no penalties for early withdraw. I assuming most people use a MM in a brokerage account inbetween investments/trades, including IRA’s, and do not want their money tied up.

With that said, the yield on those CD’s are great, especially considering the looming rate cut.

It also shows the desperation for funds that CFC is offering such a high rate, of course its better than paying 11% and it doesn’t convert into equity… 🙂

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