BrianB
Recycles dryer sheets
We have 2-3 years of spending money at Fido. About half is in government money market funds (SPAXX and FDRXX) and half is in brokered Wells Fargo CD's with maturities of 6/12/18/24 months.
My (purely theoretical) questions are:
1. What could cause the MM funds to "break the buck" (value drop below $1.00 per share)? In 2008 Reserve Primary fund (not a government MM fund) had a big Lehman Brother's holding that became worthless overnight and the value dropped to $0.97 / share. They were locked for a seven day cooling off period. We could weather a 3% loss but we count on the liquidity. What should MM fund holders watch out for?
2. Has anyone here ever had a CD default and needed to get reimbursed by the FDIC? Did it take a long time to get the money?
Strange times we're living in…
BrianB
My (purely theoretical) questions are:
1. What could cause the MM funds to "break the buck" (value drop below $1.00 per share)? In 2008 Reserve Primary fund (not a government MM fund) had a big Lehman Brother's holding that became worthless overnight and the value dropped to $0.97 / share. They were locked for a seven day cooling off period. We could weather a 3% loss but we count on the liquidity. What should MM fund holders watch out for?
2. Has anyone here ever had a CD default and needed to get reimbursed by the FDIC? Did it take a long time to get the money?
Strange times we're living in…
BrianB