The latest issue of Financial Week features "Rate rise flattens money funds", which says, "The yield advantage that money market mutual funds have enjoyed over direct investments in securities during the past nine months is likely to wane as the Federal Reserve signals it has finished cutting interest rates. But after auction-rate securities and other troublesome investments burned corporate cash managers during the credit crunch, experts are split over how swiftly corporate investors will return to direct investments." It quotes Pete Crane, "The biggest buildups [in money fund assets] ... have occurred in periods of falling rates. This latest one has been the largest buildup in the history of cash." FW adds, "`But that era may be coming to an end, he said, since the 'lag effect' reverses when rates increase."

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