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Posted by on July 21, 2008, 8:07 am
> What would it take for me to start worrying about the money I put into our
> Fidelity Cash Reserve accounts?
> What kind of financial crisis would it take to affect this account and money
> markets in general?
>
I'm sure you know money market funds are NOT FDIC insured. But the
risk of loss is extremely low. There have been countless articles
indicating the major mutual fund companies would cover any losses (at
their expense) to ensure the NAVs of their money market funds don't
fall below a dollar. The theory is the loss of confidence would cause
many investors to flee all their funds. I wouldn't worry.
If you feel you need the FDIC insurance, I'm sure you can find a
better rate using a money market ACCOUNT at a bank (which is FDIC
insured). You can find the high rates at bankrate,com.
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