As far as safe investments go, there basically are none right now. Traditionally, in turbulent economic times, money flees to "safe havens" like money market funds. To my utter shock, I discovered that it was a single money market fund that basically caused this current financial crisis.

This crisis began when Lehman Brothers announced some absolutely horrible financial results. Other financial institutions would quickly follow with similar results, but Lehman was the first, owing to their peculiar accounting periods (non-standard for Wall Street, they report in the Aug/Sep timeframe).

At this point, the crisis was still contained in the mortgage banking sector. Lehman had no choice but to ask for a public bailout, and Secretary of the Treasury Paulson, reflecting Republican thought at the time, decided that the free market should deal with Lehman Brothers poor decisionmaking.

In retrospect, it was a very bad move for the US treasury.

Lehman Bros was forced into bankruptcy.

What happened next was that the Prime Reserve money market fund, a large $65 billion dollar fund of supposedly absolutely safe investments, had a huge problem: in attempting to squeeze every last ounce of return to their investors, they'd invested in Lehman Bros. IOUs, which became worthless overnight when Lehman tanked.

Prime Reserve had to announce that they'd "broken the buck". This is the absolute worst thing to happen to a money market fund...at the end of the day, a money market fund should ALWAYS ALWAYS ALWAYS have one share equal to one dollar.

Prime Reserve shares plunged to 97 cents and the credit market went to hell. Big banks, who were major investors in Prime Reserve, yanked their funds immediately and the Treasury department had to intervene with massive infusions of cash to prevent a wholesale system meltdown.

The suddenly tightened credit affected literally everything it has touched, and even highly profitable corporations like McDonalds (!!!) saw their lines of credit pulled. (McDonalds was drawing on their lines of credit for the first time in decades to buy high-end coffee machines for their stores for the new McLatte rollout).

So in a nutshell, there are virtually NO safe investments nowadays. I expect to see a huge spike in gold prices (the traditional "last resort" investment opportunity) soon.

By the way, the underlying cause of this mortgage meltdown? In 2004, the Treasury department allowed six firms to do away with the old "never lend money more than 12 times your asset base" and bumped these firms limits from 12:1 to a whopping 30:1. Of those six firms, one has done well, one has broken even, and four (including Lehman Bros) are now in bankruptcy.

Very depressing.

What about international stocks and CDs? Last week some of the rates looked pretty good right after our devasting news in the U.S. was released.

I'm afraid you are right, Sniffles. It's a sad state of affairs and getting worse by the minute. What we don't know is still out there!

There is no safe haven right now. Just hold on tight...

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Is this color thing a critical item with you?

Cheney is a relative you know!