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My guess is new investors would cause them to buy more Gov. Securities
and that would put more pressure on yield. Who would want them
anyway? What is our government going to do with lower rates and lower
dollar? Something is going to give and it wont be the dollar will it?
Best of all look what we do with the funds generated from our growing debt.
Gold is probably a good indicator.
Jimmy
In reviewing some of my youngest son's investment accounts I find that
Schwab has closed both their Government and Treasury money funds to
investors not currently invested in them.
What a great testimony to the client orientation of that particular firm.
There is a real credit crunch that is occurring across the board, but
for those who really want to accept the below normal rates of
governments as a trade off for risk, that option should be available.
I have no idea how much, if any, of the suspect securities are held in
any of the other Schwab money funds, but the only advantage I can see
for their action is to make sure that those non governmental funds have
some improved inflow of cash to meet redemption requests.
Any one with a better idea of why, and is your broker doing the same?
Richard Funkhouser
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