Investors Continue to Flee Money Funds

Oct 3, 2008

  1. Brokers Alliance
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    Interesting news for Annuity agents:

    Thursday, October 2, 2008 2:32 PM


    Money is still running out of money market funds, despite a Treasury announcement that it would back the instruments.

    Research firm iMoneyNet reports that investors yanked a net $40.8 billion from prime funds though Thursday. Government money market funds took in a net $82.9 billion.

    The run on funds began when the Reserve Funds Primary Fund “broke the buck” in mid-September. This week it liquidated completely, offering remaining shareholders between 30 percent and 40 percent of what was supposed to be safe money.

    "Money market investors have never seen anything like this," Peter Crane, president of Crane Data LLC told InvestmentNews.com. "It was a near-death experience."

    Primary Fund got caught up in the aftermath of the Lehman Brothers bankruptcy. It held $785 million in Lehman debt at the time. The fund fell to 97 cents per share and investors rushed to get out, forcing it to close.

    A few days later, Putnam Funds voted its $12.3 billion Prime Money Market. Its managers said the problem wasn’t short-term debt but a simple run by scared investors that forced its hand. The company later joined the federal program.

    Ten major money managers immediately signed on to the new Treasury program, reports The New York Times, including Charles Schwab, Federated, Morgan Stanley, Putnam Investments, BlackRock, and JPMorgan Chase.



    © 2008 Associated Press. All rights reserved.
     
  2. benpkwy
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    How are you guys doing out there with the market being the way it is right now?
     
    benpkwy, Oct 14, 2008
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  3. Brokers Alliance
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    Annuity business is picking up as a result. However, I have collected a few letters from the Presidents of some annuity carriers that detail their investments, which I forward to agents to show clients. I'm sure some agents here have received them.

    Building credibility is important - especially these days.

    If you would like them, contact the marketing departments of the carriers you use or your FMO.
     
  4. benpkwy
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    I am thinking about signing up thru Safe Harbor Financial. Have you heard of them? I don't want to short change myself! Any suggestion as far as FMO
     
    benpkwy, Oct 14, 2008
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  5. SmartMoney
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    Depends on the Products and IMO... Safe Harbor represents some of the better companys out there, but I have no experience with their service...
     
  6. benpkwy
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    Who do you work with? Who would you recommend?
    For Fixed annuity
     
    benpkwy, Oct 14, 2008
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  7. SmartMoney
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    replied directly to you, I know this board is picky about these types of things...
     
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