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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: S. maltophilia who wrote (88304)	1/11/2001 4:33:52 PM
From: Nadine Carroll	Read Replies (1) \| Respond to of 132070

Neither SIPC nor anyone else will help when your MMF breaks the buck because of Tulip Funding or California utility commercial paper For a MMF to break the buck would be considered a market loss, would it not? So I can understand why SIPC won't help you there. The question is, if your brokerage suffers a Barings-type disaster, or even just a general market crash, will you be able to redeem your holdings from them? How do you even go about gauging the answer to this?

To: S. maltophilia who wrote (88304)	1/11/2001 6:15:46 PM
From: Knighty Tin	Read Replies (1) \| Respond to of 132070

Khalil, True, SIPC is not govt., but it has a lifeline call to the SEC. Since institutions have to register with the SEC to qualify for SIPC coverage, there is a quasi-govt. involvement. Any institution that does not ante up becomes an instant suspect. And nary a member does not opt for the insurance. If any firm goes belly up after extensive reporting to the SEC, the SEC will be crucified. And the Treasury along with it. So, the money will appear for the average investor. We were talking about fraud or firm bankruptcy, not picking the wrong issues. Your stocks are insured against somebody stealing them, but not against your portfolio manager being an idjit head (even if it is yourself). Ditto for your money fund. I can't find anyone who offers idjit head insurance. And there are times when I could use it. <g>