Business: Mania for Money Market Funds

Small investors get a better deal, but some banks are hurting

How to preserve capital in a time of double-digit inflation and depressed stock prices? Frustrated savers and unhappy investors are turning to the same solution. In record amounts, Americans are buying into the relatively new money market mutual funds. They offer minimum risk and yields of 10% to 13%, double or more the low rates set by the Government on passbook savings accounts.

The money funds invest not in stocks or gold or commodities but in high-quality, high-interest bank certificates of deposit, commercial paper, Treasury Bills and other U.S. Government securities.

The idea...

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