Money market funds...are they the next bailout?

allenwrench · Intermediate Crude Joined: Apr 23, 2008 Posts: 728

Wow, if we didn't have all these Gov bailouts there would be tons of bankruptcies. Now Fannie and Freddie have been bailedout.

http://www.msnbc.msn.com/id/25635292/

It feels like we are in a depression economy that is held up with safety pins, but is ripping at the seams. It may not be that bad with unemployment as compared to the depression, but many of the big names of finance seem to be headed for a fall.

Money market funds...are they the next bailout? They say money market funds are safe because:

They have never had a default (maybe 99.9% true,)

And if there would be a fund that would go under, the other members of the fund community would step in to make everyone whole.

Well, as one of our members pointed out - there is a first time for everything. And with the trillions invested in MMF's and our countries predisposition to lying and reckless speculation, I wonder if MMF's are the next shoe to drop?

How safe are these funds? Would the gov bail us out as they have bailed big institutions out if our MMF's collapsed? Do you have money in these funds? If so, what would prompt you to take it out? The first big failure? (Or could that be too late of an indicator and everyone would be in the same redemption boat?)

Ludi

Why would they be bailed out? There are no guarantees on MMF, all investment is at risk, as I recall.

I have a couple small ones, but, I don't think about them much.
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"...powerdown so soft and fluffy you'll think you're living in a pillow..." - jboogy

RonMN

No need to worry, MMFs are insured by MBIA and AMBAC Laughing

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