How safe are your money-market funds?

Money-market funds (MMFs) are meant to be super-safe, super-liquid vehicles for short-term assets in which investors can park their cash and still earn a competitive rate of return. Yet in September 2008, the surprise default of Lehman Brothers so roiled the markets that Reserve Fund Management's $62 billion prime money-market fund broke the buck. This in turn was so unprecedented that it gummed up repurchase and securities-lending markets; it was the mechanism that created a credit…