Oh Great

I guess there’s no place “safe” these days

Extraordinary events are piling up on Wall Street so fast, it’s hard to know where to focus. Forgetting the prospective bailout of AIG for a moment, since every media outlet is on that one, the most shocking development of the day for me is news that a $60 billion money market fund “broke the buck” on Monday due to losses in Lehman Brothers paper that it held. So much for the safety of “cash”.
The Reserve Primary Money Fund (RPFXX) has become the first money-market fund in more than a decade to lose money because its board was forced to write down $785 million worth of LEH debt to zero. The fund has reportedly seen assets plunge by 60% to $23 billion in the past two days after holders got wind of the fact that it would have to cut its net asset value to less than its usual $1 per share.

Read the author’s related article here; and note that it dates from last December.
For the next few months your mattress may give you the best rate of return.

One Response to “Oh Great”

1. Rob says:

   September 17, 2008 at 11:00 pm

   “For the next few months your mattress may give you the best rate of return.”
   It always has … wait, what did you mean???