Muni Money Markets at 5.25%+

October 7, 2008

Take a look at these tables ripped right from the pages of Schwab Institutional. Amazing ? Mistake ?

With “normal” taxable money markets are yielding less than 1%:

Look at the raw tax-free muni money market rates now….

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Written by Andrew Horowitz · Filed Under Economy

993CommentsMuni+Money+Markets+at+5.25%25%2B2008-10-07+16%3A30%3A59Andrew+Horowitz to “Muni Money Markets at 5.25%+”

Sean Sadler on October 7th, 2008 2:31 pm

I’ve been pretty much a stock guy until now, so please forgive my ignorance on Muni Money Markets, but when they show 7-day yield’s of 8% does that actually mean that you will earn 8% on your investment over a 7-day period of time?
Andrew Horowitz on October 7th, 2008 11:44 pm

7-day compounded yield. If it holds steady, you will earn that for they year (assuming…)

A
George Wu on October 8th, 2008 8:33 pm

What’s the catch?
Jonathan Lawson on October 8th, 2008 9:48 pm

Can you buy these Schwab funds only if you have a Schwab acct, or can you buy them through a different broker.

And do these rates continually fluctuate from week to week?
Mark on October 9th, 2008 9:54 am

I don’t think that I would say that there is a catch. My firm’s (I am an advisor) tax exempt MM funds are in this range.

Keep in mind that these are money market FUNDS and not money market deposits so they are not covered by the FDIC.
Matt on November 3rd, 2008 9:54 pm

Rates are now down below 2% on these same funds. I can get a higher rate with an hsbc online savings account:

http://www.hsbcdirect.com/1/2/1/default/learn-more/osa?code=husa

Oh well…

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The Disciplined Investor