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Once Shunned, Money Market Funds Are Proving To Be An Unlikely Haven
Muddled writing in the article, but an interesting graphic. Short term Treasury bill debt that matures at the end of Sept. (when the debt ceiling is projected to be hit) has fallen sharply in price (yield is spiking). People are pricing in the risk of late repayment of principal.
While I'm not suggesting a total financial collapse, it wouldn't hurt to check your bank's rating (FDIC could theoretically get stressed and have no Treasury backstop). It's also interesting to ponder the possibility that prime MMFs might be safer than the government MMFs that people were funneled into for safety.
That mattress is beginning to look better and better
FWIW, ratings of some of the better known online banks (see depositaccounts.com) Ally Bank: A+, 1.15% savings Amex Bank: A, 1.15% HY savings Barclays: A, 1.15% savings Discover Bank: A, 1.15% savings Goldman Sachs: A+, 1.20% savings Synchrony Bank: A, 1.20% HY savings
Comments
While I'm not suggesting a total financial collapse, it wouldn't hurt to check your bank's rating (FDIC could theoretically get stressed and have no Treasury backstop). It's also interesting to ponder the possibility that prime MMFs might be safer than the government MMFs that people were funneled into for safety.
That mattress is beginning to look better and better
FWIW, ratings of some of the better known online banks (see depositaccounts.com)
Ally Bank: A+, 1.15% savings
Amex Bank: A, 1.15% HY savings
Barclays: A, 1.15% savings
Discover Bank: A, 1.15% savings
Goldman Sachs: A+, 1.20% savings
Synchrony Bank: A, 1.20% HY savings