Doug Gary: “I just learned that anyone willing to park $10,000 at DLJDirect for six months (competitive money market rates available, no trades required) by opening up a new account will be given a “free” Handspring Visor — valued at about $180. That’s quite a return! Being in love with my Palm, I signed up to get my partner a Visor. The link is: The deal ends on July 15th. Full disclosure: no position in DLJ, but a happy brand new customer — at least for six months.”

Leaving aside the issue of being in love with one’s Palm, if you keep money in a money market account anyway — why not? Every extra $180 helps.

David D’Antonio: “In your Copyrights and Copenhagen III column, you reprint the ‘Hell’ joke wherein the student ‘proves’ that Hell is heating up (because he hasn’t (yet?) slept with Ms. Banyan so it couldn’t have frozen over). But this is not true! As you may recall, when the band the Eagles broke up, Don Henley (I think) said they wouldn’t get back together until Hell had frozen over. Yet they not only did get back together, they released an album by that name — Hell Freezes Over — signifying the event! Also, if I recall correctly, Dante’s Ninth Circle of Hell was, in fact, a frozen lake. Embedded in the ice were those servants who betrayed the trust of their masters, which Dante obviously felt was the most grevious sin, since it was the lowest Circle.”

Russell Turpin: “Re” Where Do Maine Lobsters Come From? . . .One enterprising Maine ISP set up a digicam inside a lobster trap. You can go to this webpage, and watch your (or someone’s) future dinner when it first takes its fatal turn. Seemingly, some lobsters are caught in Maine. Maybe those are the ones that get shipped to Texas?”

Tom Sasek: “I have a friend who has a large amount of excess cash (around $75,000) sitting in his checking account. He realizes the need to invest the money. However, he is concerned that a money manager or investment firm will charge excessive fees. Also, he does not have a lot of free time or expertise, so he cannot do anything complicated on his own. What is the best way to invest this money safely, without paying hefty fees?”

There is no rush, Tom. To have money in a bank earning interest when the market is falling 20% is not a bad thing. Think how much your friend “made,” relative to his friends and neighbors, by not being in dot-coms.

Your friend should transfer the money into one of those accounts at his bank that pays interest and allows him to write three checks a month. Then he should take a weekend to read my investment guide (borrowed from the library, to keep this from being a shameless plug) and maybe do something slightly more sophisticated with some or all of it. E.g., committing a portion of it to two or three index funds — in regular monthly installments over a couple of years, not all at once. And/or putting some of the money into the Series I US Savings Bonds I’ve been writing about.

Your question set three parameters: low fees, simplicity and safety. I totally agree with the first two. Simple is often cheapest and best. Keeping fees, taxes and transaction costs to a minimum puts you way ahead of the crowd. (For more on this, mutual fund owners should click here to see what a difference costs make.)

The third parameter — safety — can make sense also, but should not be accepted blindly. Safety sounds as if it’s always a good thing; but over the long run, the safest investments are likely to grow only very modestly compared to those that entail more risk. The long run could be very long, and taking risk by no means guarantees a high return — far from it. But choosing safety exposes you to a different risk: that you will wind up with less than you need.


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