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Old 09-21-2009, 07:51 AM
 
Location: a nation with hope
13,153 posts, read 17,370,800 times
Reputation: 5025

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Quote:
Originally Posted by mikey2 View Post
I called Fidelity today and the guy I spoke with knew exactly what I was talking about and confirmed the MM accounts wouldn't have protection after today.

Mikey.
Thanks to your post, I contacted Fidelity again and spoke to a different rep.
She knew exactly what I was talking about (though I myself wasn't quite sure what I was talking about) The coverage that was in place was a U.S. Treasury Temporary Guarantee Program for Money Market Funds which guaranteed dollar-for-dollar value in the MM fund. Without this coverage, MM funds can fall below $1 per share, and however low it goes, that's what you'd get if you sold at that point. Fidelity has not been in the guarantee plan since April. MM accounts at banks are covered by FDIC insurance (if that's any comfort to anybody out there)

The funds still carry SIPC insurance up to $500K max (cash reserves 100K max). If I understood correctly, anything above that max amount would be covered by Lloyds of London. If you have money with an investment company, be sure to check with your own company on specifics.

To clarify my earlier post, the FDIC insrance that will be coming to Fidelity will be only for the CDs that Fidelity purchases from banks, not for any of their funds.

Thanks again, Mikey. Can't remember if I rep'd you, but will check right now.
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Old 09-21-2009, 08:18 AM
 
11,127 posts, read 12,652,436 times
Reputation: 3676
The FDIC won't guarantee bank debt for much longer. This could separate the boys from the men. Buy investment banks.

FDIC broke... this don't sound good.

Banks Leaving Life Support - Forbes.com
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Old 09-21-2009, 08:24 AM
 
Location: Kansas City, MO
5,763 posts, read 9,724,357 times
Reputation: 2801
I really wouldnt worry about your money market accounts. Most of them are invested in government and top tier securities. Only a microscopic fraction of money markets dropped below a dollar per share and that was in extreme circumstances.

If money market funds start dropping below a dollar, you will have a lot larger problems than your money in that particular fund.
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Old 09-21-2009, 12:09 PM
 
Location: a nation with hope
13,153 posts, read 17,370,800 times
Reputation: 5025
Quote:
Originally Posted by TnHilltopper View Post
The FDIC won't guarantee bank debt for much longer. This could separate the boys from the men. Buy investment banks.

FDIC broke... this don't sound good.

Banks Leaving Life Support - Forbes.com
Yes, we've been hearing for a while now that FDIC wouldn't have the money to cover everyone, should there be a mass crash. I don't have all that much, so I think I'll just stuff it into the mattress. It should fit easily.

Quote:
Originally Posted by RjRobb2 View Post
I really wouldnt worry about your money market accounts. Most of them are invested in government and top tier securities. Only a microscopic fraction of money markets dropped below a dollar per share and that was in extreme circumstances.

If money market funds start dropping below a dollar, you will have a lot larger problems than your money in that particular fund.
I tend to agree. There was a period a few years ago when the dollar in MM funds fluctuated and occasionally dropped below $1, but then came back up.
However, considering today's economy, if that started happening again, I agree with you.
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Old 09-21-2009, 01:57 PM
 
Location: Great State of Texas
86,093 posts, read 72,290,637 times
Reputation: 27564
The FDIC can tap the Treasury. There's $500 billion lined up for them.
FDIC Considers Borrowing From Treasury to Shore Up Deposit Insurance - WSJ.com

Lord know where the Treasury will get that money...oh I forgot..Uncle Ben and his printing press !!
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Old 09-21-2009, 02:55 PM
 
Location: a nation with hope
13,153 posts, read 17,370,800 times
Reputation: 5025
Quote:
Originally Posted by HappyTexan View Post
The FDIC can tap the Treasury. There's $500 billion lined up for them.
FDIC Considers Borrowing From Treasury to Shore Up Deposit Insurance - WSJ.com

Lord know where the Treasury will get that money...oh I forgot..Uncle Ben and his printing press !!
Thanks for reminding me of Uncle Ben. Now I can sleep at night.
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