The LA Times writes "Money market funds see $103-billion outflow amid debt drama". It says, "Big investors' fears over the federal debt-ceiling drama triggered a near-record outflow of cash from money market mutual funds over the last week. Apparently worried that some money funds could suffer losses if the Treasury defaulted on some of its debts, investors yanked a net $103.2 billion from the funds in the seven days ended Tuesday, data tracker iMoneyNet Inc. said. That was close to the record $120.4 billion that exited the funds in the week ended Sept. 23, 2008, amid the financial system collapse. On a percentage basis, this week's decline was larger -- amounting to 3.9% of total fund assets of $2.63 trillion. The 2008 outflow was 3.5% of assets at the time." The article quotes Pete Crane, head of money-fund research firm Crane Data in Westborough, Mass., "It was a direct result of the debt ceiling debate and fear of default." The Times adds, "But with the debt ceiling lifted after an 11th-hour compromise in Congress, cash began to flow back into money funds on Tuesday, Crane said. Where did the money go when it left the funds? "Banks no doubt were the main beneficiaries," Crane said. Because banks can offer unlimited federal deposit insurance on non-interest-paying business accounts, institutional investors could easily park cash in those accounts with no risk of principal loss."

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
March December December
February November November
January October October
September September
August August
July July
June June
May May
April April
March March
February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September