June 21, 2007
-- by Dave Johnson
Will today be a really bad day for the stock market? (Or worse?) There are signs that the ripples from the housing bubble's pop are starting to spread.
Merrill Lynch & Co.'s threat to sell $800 million of mortgage securities seized from Bear Stearns Cos. hedge funds is sending shudders across Wall Street.The REAL value of these instruments? Who knows? And who owns them?
A sale would give banks, brokerages and investors the one thing they want to avoid: a real price on the bonds in the fund that could serve as a benchmark. The securities are known as collateralized debt obligations, which exceed $1 trillion and comprise the fastest-growing part of the bond market.
Here's the thing - this is the money market. This is YOUR money-market fund. Find out if YOUR money-market funds are FDIC insured!
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