From: "Andy" 
Newsgroups: misc.invest.financial-plan
Subject: Re: Where to park short-term excess cash?
Date: Thu, 7 Dec 2006 15:59:56 -0600
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John A. Weeks III wrote:

> I advocate that an emergency fund is not needed these days.
> I'd suggest fully investing your money to make it work as hard
> as it can.  For emergencies, first, try to avoid them.  But since
> not all are avoidable, have a credit card or a home equity line
> of credit available (ie, in place before it is needed).  Then
> use your earning power to rapidly pay it back in the event it
> is ever used.  If you are one of those folks who misbehave with
> credit, then this would be a bad idea, and the cash emergency
> fund is the best way to go.

What happens under your no emergency fund strategy if the emergency is
one or all household wage earner's losing their job or becoming
disabled? Then there is not necessarily enough earning power to rapidly
pay back the amounts borrowed on credit cards.

Also, many credit cards now have universal default provisions, and in
the event of disability or losing a job a household could find
themselves missing some bills and then having the credit cards they are
depending on increase their rates.

Andy