Chuck Jaffe's "Offshore CDs Are a Risky Solution To Low-yield Savings Woes" answered a reader question about Millennium Bank, located in St. Vincent and the Grenadines' "high-yield certificates of deposit carrying a 6.75% interest rate". Jaffe's MarketWatch column answers, "The obvious issue with Millennium Bank is that offshore banks carry no Federal Deposit Insurance Corp. protection and little recourse for domestic investors if things go wrong." He quotes Peter Crane, "Right now, with the Fed funds rate at 0.25%, anything over 3% should raise a major red flag.... And then you are going offshore so you lose any semblance of protection, so that's another major red flag." In other news, see "Moody's assigns Aaa/MR1+ rating to Western Asset Management Fund," which says the new Dublin-based ("offshore") Western Asset Euro Government Liquidity Fund obtained Moody's highest rating last Friday.
