myinvestorsplace
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The Dollar Has Broken?
I do not mean the US Dollar has crashed, Gd Forbid. But what I mean is that the Reserve Primary Fund a money market fund which had $62.6 billion in assets net asset value fell below $1.00. This is due to the toxic paper that Lehman defrauded the world with. I use the word had... because with all the volatility earlier this weak... several investors pulled out $40 billion dollars from the Reserve Primary Fund...
Traditionally money funds have long been viewed as safe places. Money-market accounts offered by banks have federal deposit insurance. However as I have been discussing ... How strong is the FDIC... I am personally concerned due to the recent events... Last year the FDIC had approx 53 billion dollars... this year one bank ( Indy Mac) took down approx 10 billion dollars of that money...as well as several small banks have failed and taken down some more of that 53 billion dollars..
There are many independent operators, such as Reserve Management. The unsettling issue is that do not have that protection of the FDIC...more so in theory...they had generally conservative investment styles have defined stability. The way Lehman used to be.
The Reserve primary fund is not alone...and I am sure there will be many more that will fail.......Personally last year I had money in an LLC that was in a cash equivalent fund with Suntrust. My colleague was told it was 100% safe..short term govt securities..etc.. As you might have read in my blogs.. I have been nervous about the credit issues for almost 2 years... so I wanted to know exactly what was in the fund... I recieved a breakdown...that almost gave me a nervous breakdown...
CAR LOANS - REAL ESTATE LOANS ON GOLF COURSES..and yes some short term govt securities...
This the problem... no one knows what the underlying was in these funds... needless to say.. I sold immediatly...went to short term govt securities and was extremely disappointed after 25 years of banking with Suntrust... I suggest you look and investigate if you have money market funds...see what exactly they are holding... possibly more so in these crazy times... you seek the security of the short term US govt security in your name... yes your name... not the banks... your name... ( you can add your wife's name also... just kidding.. I always do)
Andrew Abraham
I do not mean the US Dollar has crashed, Gd Forbid. But what I mean is that the Reserve Primary Fund a money market fund which had $62.6 billion in assets net asset value fell below $1.00. This is due to the toxic paper that Lehman defrauded the world with. I use the word had... because with all the volatility earlier this weak... several investors pulled out $40 billion dollars from the Reserve Primary Fund...
Traditionally money funds have long been viewed as safe places. Money-market accounts offered by banks have federal deposit insurance. However as I have been discussing ... How strong is the FDIC... I am personally concerned due to the recent events... Last year the FDIC had approx 53 billion dollars... this year one bank ( Indy Mac) took down approx 10 billion dollars of that money...as well as several small banks have failed and taken down some more of that 53 billion dollars..
There are many independent operators, such as Reserve Management. The unsettling issue is that do not have that protection of the FDIC...more so in theory...they had generally conservative investment styles have defined stability. The way Lehman used to be.
The Reserve primary fund is not alone...and I am sure there will be many more that will fail.......Personally last year I had money in an LLC that was in a cash equivalent fund with Suntrust. My colleague was told it was 100% safe..short term govt securities..etc.. As you might have read in my blogs.. I have been nervous about the credit issues for almost 2 years... so I wanted to know exactly what was in the fund... I recieved a breakdown...that almost gave me a nervous breakdown...
CAR LOANS - REAL ESTATE LOANS ON GOLF COURSES..and yes some short term govt securities...
This the problem... no one knows what the underlying was in these funds... needless to say.. I sold immediatly...went to short term govt securities and was extremely disappointed after 25 years of banking with Suntrust... I suggest you look and investigate if you have money market funds...see what exactly they are holding... possibly more so in these crazy times... you seek the security of the short term US govt security in your name... yes your name... not the banks... your name... ( you can add your wife's name also... just kidding.. I always do)
Andrew Abraham
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