Greek Default, Your Money

 

By Kevin Brett

CNBC's John Carney has an article explaining how default in Greece could impact your wallet:

Forty-four percent of mutual fund assets in the U.S. are invested in the short-term debt of European banks, according to a report from Fitch.

A separate report from Moody's noted that 55 percent of those holdings are in the commercial paper of French banks, such as Societe Generale, BNP Paribas [BNP-FR 51.11 -0.19 (-0.37%) ] and Credit Agricole. French banks are some of biggest creditors to Greece, with over $53 billion in outstanding loans to the Greek government and private sector.

Read the rest here.

Analysis via "I bet Ludwig von Mises can get more fans than John Maynard Keynes" on Facebook:

Moral hazard is when the state gives an industry an explicit or implicit promise of security that it cannot keep. The state stopped insuring money-market accounts in 2009, but many holders of money-market accounts didn't pay attention, and "Many believe that in a crisis the gov't would once again step in to insure the accounts, just as it did in 2008" Is a massive tragedy coming, especially for old people?

Sept. 19, 2008 - New York Times, Treasury to Guarantee Money Market Funds

Financial Industry Regulation Authority [FINRA], Treasury's Guarantee Program for Money Market Mutual Funds: What You Should Know

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