Still comfortable with Fidelity money market funds

Despite all of the financial turmoil this week, including a dramatic case of "breaking the buck" by a large retail money market fund, I remain confident and comfortable with keeping my cash in Fidelity money market funds. Even without the new Treasury "insurance", I would still be confident and comfortable.

I would note that the new Treasury insurance is in theory only temporary, for the next year, but I do expect that an equivalent permanent insurance program will be set up well before a year passes. I personally am not expecting to be dependent on either program either now or in the future.

I do expect that I will diversify my cash a little, especially since I can get a better interest rate with FDIC-insured accounts at a number of banks. Fidelity still offers me a number of convenience factors that outweigh completely moving cash to traditional banks. Simply having higher rates and FDIC protection is still not enough to erase all of the annoying "traditions" of traditional banks that result in a lower quality of overall service. OTOH, banks to offer services that Fidelity, et al are unable to provide, such as being able to go to their ATM, get some cash, and then walk to the teller window to convert all of those annoying $20 bills to more convenient $5 bills.

-- Jack Krupansky