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To: yard_man who wrote (231694)	3/27/2003 5:39:50 PM
From: Knighty Tin	Respond to of 436258

Tip, Hmmmm. I thought stable value meant buying a horse for the Kentucky Derby run. <g> One thing the writer says which is nonsense is that "even if the insurer goes bankrupt, the investor is left with a high quality bond portfolio." Sorry, can't happen. The only way to pay 6% and guarantee principal is for the insurance co. to buy lower rated bonds. They effectively take the interest rate and principal risk. For a good chunk of the interest. So, you may be buying junk bonds with an 8% interest rate, but you are only getting 6% of it. But, by proxy, you are taking the risk of the junk portfolio. All you get is the comfortable feeling that Crazy Joe's Fiduciary says your portfolio is stable. Someday the fit will hit the shan on this stuff.