Comments on: Lehman Bankruptcy, Bank of America/Merrill Lynch: What Can We Learn Here?

By: Tim

Tim — Wed, 17 Sep 2008 17:48:55 +0000

it comes down to fundamentals: diversify, don’t risk more than you can afford to lose, and don’t spend more than you make.

FDIC is fine at the moment, but if a major bank collapses like citi or bac, there won’t be sufficient FDIC capital to replace $1 for $1. and not all deposits are created equal. just like everything else, do not rely on one safety net. who would have thought the $1 to $1 money market fund would drop below $1? no one. so, although fdic looks good as a safety net, i wouldn’t completely count on it. with banks not willing to lend each other money, it is best to diversify accross banks now too. again, this experience should teach us a great deal about many fundamental and basic financial axioms, rules, behavior, whatever.

By: Julie

Julie — Tue, 16 Sep 2008 20:59:51 +0000

Hi all, I work for ShoreBank (http://shorebankdirect.sbk.com/). In addition to knowing that your money is invested conscientiously – it’s nice to know that it’s SAFE too! Be sure that your bank is FDIC insured, and also pay mind to other security measures. ShoreBank, for instance, has $2.2 billion in assets to add to its security. They also have a 3.5% interest HYSA – so have a look at the link!

By: My Money Your Money

My Money Your Money — Tue, 16 Sep 2008 15:24:07 +0000

diversification-diversification-diversification

diversification is a key of any investment. also, basic information about FDIC insurance (just google “FDIC insured”) may help you to protect your cash in checking, savings, IRS, money market account.

BTW, its a really good article.

By: Matt @ Steadfast Finances

Matt @ Steadfast Finances — Mon, 15 Sep 2008 15:37:30 +0000

Well said. Diversification is your friend during the bad times, but it can also be your enemy in the good times. The point is finding a balance between the two, and knowing the time to get out is when everyone else is trying to get in.

By: Miranda

Miranda — Mon, 15 Sep 2008 12:54:08 +0000

Great post! Hope you’re back to enjoying your vacation. At any rate, I tend to agree with you. Diversifying (but in moderation, of course) works well for me, since I’m just looking for some regular streams of income that will take me into retirement and beyond in my comfortable but modest lifestyle.

By: Writer's Coin

Writer's Coin — Mon, 15 Sep 2008 10:53:04 +0000

I’m all for focusing on one thing (or stock) and putting all your energy into making it work, but you better be positive that you’re doing it right. These days, it’s hard to find someone (or something) that you’re that sure of. And if you’re investing in financials, it’s impossible to know what’s going on if you’re an outsider. You can’t even trust the numbers they’re putting out anymore.