Daily Links Archives: June, 2026
Bloomberg: Money Funds Hot Strategy
Bloomberg writes, "Chilling in Money-Market Funds is the Hot Retail Strategy Now." The article, written by Alex Harris and Carter Johnson, states, "The stock market keeps setting records. Bitcoin has minted millionaires. Gold has peaked at new levels. Yet one of the most popular trades is to sit in cash or, more precisely, money-market funds. These plain‑vanilla vehicles, which invest in short‑term debt, have become the default parking spot for everyone from retail savers to corporate treasurers. The US money-market industry now holds a record $8.29 trillion -- almost twice the size of Japan's economy -- after inflows topped $1 trillion last year, according to Crane Data LLC, which tracks the industry. The strategy's popularity has been accompanied by a Wall Street catchphrase, 'T-bill and chill,' which has come to signify investors' preference for the short-term Treasuries these funds often hold." It quotes Peter Crane, president of Crane Data, "Convenience is king with cash. It's the ultimate hedge when other assets like Bitcoin and gold have done more going up and going down.'" The piece explains, "Stability in finance has been rare over the past decade as the Covid-19 pandemic, geopolitical conflicts and the rise of artificial intelligence unleashed uncertainty across global markets. The volatility has pushed safety-minded investors toward money-market funds, where the appeal is the combination of stability and returns. Yields on the 100 largest funds were near 3.5% at the end of April, according to a Crane Data index. To Amrita Bhasin, a 25-year-old tech worker in California, money-market funds feel easier to manage than, say, certificates of deposit, where cash is locked up for a specific period and subject to penalties. 'With money-market funds, I feel like I have more visibility and control over what's happening with my money,' she says. 'I want to understand where my money is, what yield I'm getting and how it's changing.'" The Bloomberg article adds, "While Wall Street forecasters have long warned that a 'wall of cash' would rush out of money-market funds and into riskier assets once the Fed started cutting interest rates, investors kept piling in last year even as the central bank lowered borrowing costs three times. Renewed market volatility in recent months, fueled in part by the Iran war and a spike in oil prices, has only reinforced the appeal of cashlike assets, with inflows continuing in 2026, according to Crane Data. 'I've been hearing the 'wall of cash' theory since money funds hit a trillion in 1997,' Crane says. 'That's the fallacy underneath the zero-sum thinking that people believe if something goes up, something else must go down.'"
MMFs Jump to New Record in June
The Investment Company Institute's latest weekly "Money Market Fund Assets" report shows money fund assets rising $109.3 billion to a new record high of $7.894 trillion, after they increased $13.4 billion the previous week. MMF assets are up by $878 billion, or 12.5%, over the past 52 weeks (through 6/3/26), with Institutional MMFs up $666 billion, or 16.1% and Retail MMFs up $212 billion, or 7.3%. Year-to-date in 2026, MMF assets are up by $161 billion, or 2.1%, with Institutional MMFs up $138 billion, or 3.0% and Retail MMFs up $23 billion, or 0.8%. ICI's weekly release says, "Total money market fund assets increased by $109.25 billion to $7.89 trillion for the week ended Wednesday, June 3, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $102.96 billion and prime funds increased by $7.96 billion. Tax-exempt money market funds decreased by $1.68 billion." ICI's stats show Institutional MMFs increasing $101.2 billion and Retail MMFs increasing $8.1 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.510 trillion (82.5% of all money funds), while Total Prime MMFs were $1.238 trillion (15.7%). Tax Exempt MMFs totaled $146.2 billion (1.9%). It explains, "Assets of retail money market funds increased by $8.10 billion to $3.10 trillion. Among retail funds, government money market fund assets increased by $6.94 billion to $1.98 trillion, prime money market fund assets increased by $3.00 billion to $991.56 billion, and tax-exempt fund assets decreased by $1.85 billion to $133.07 billion." Retail assets account for 39.3% of the total, and Government Retail assets make up 63.7% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $101.15 billion to $4.79 trillion. Among institutional funds, government money market fund assets increased by $96.02 billion to $4.53 trillion, prime money market fund assets increased by $4.96 billion to $245.94 billion, and tax-exempt fund assets increased by $170 million to $13.12 billion." Institutional assets accounted for 60.7% of all MMF assets, with Government Institutional assets making up 94.6% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $42.3 billion to $8.334 trillion month-to-date in June (as of 6/3), assets hit a record high on June 2 of $8.334 trillion. Assets increased $208.6 billion in May, decreased by $108.8 billion in April, $49.3 billion in March, increased $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion in July and $6.7 billion last June. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
WSJ: Study Claims Too Much Cash
The Wall Street Journal wrote earlier this week that, "We're Keeping Too Much Cash in Our Accounts These Days." They explain, "Most Americans couldn't cover an emergency expense of $1,000 without borrowing money. That's probably less of an issue for people who read a daily markets newsletter. In fact, many savers have too much cash, which sounds like a high-class problem. Sure, life throws us curveballs -- illness, divorce, unemployment -- so a little extra cushion can come in handy. But it's surprisingly costly to overdo it. About $5.6 trillion or 10% of Americans' liquid wealth is in low-yielding bank deposits. Trillions more sit in money-market mutual funds." The piece says, "People often keep it there longer than necessary for a variety of reasons. Maybe they receive interest or dividends and let the proceeds pile up. Often they're sitting on a lump sum and don't want to commit it all at once to riskier investments like stocks or bonds because markets seem frothy or they fear yields might rise." The article speculates, "Cash earns something these days, but not much -- basically zero after taxes and inflation. Over any longer period, the opportunity cost of holding it is likely to exceed that of poor timing in the stock market." It says, "Fidelity Investments ran the numbers for what would have happened to someone who invested $5,000 in U.S. stocks annually between 1980 and 2023 at the best and the worst possible juncture each year. A portfolio with perfect timing would have grown to nearly $5.6 million in the S&P 500 while the one with perfectly awful timing would grow to $4.3 million. `Leaving that money in cash throughout that span would have turned into just $350,000. That's extreme, but many of us keep too much dry powder for future opportunities." Finally, the WSJ claims, "Money-market funds tend to see big inflows after a selloff -- usually the time that stocks are poised for some of their strongest performance. Morningstar's 'Mind the Gap' study calculated that U.S. mutual-fund investors earned a significant 1.2 percentage points less than mutual funds on average over the past decade. Cash-like investments certainly have their place in a portfolio, and not just for emergencies. Owning something safe and liquid that doesn't rise and fall with stocks or interest rates makes more and more sense as one gets closer to tapping savings because it gives us the ability to ride out bear markets. But young savers with a long time horizon, and some wealthy ones closer to retirement, are costing themselves by holding too much cash for the wrong reasons."
Weekly Money Fund Portfolio Holdings
Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of May 29) includes Holdings information from 56 money funds (down 18 from a week ago), or $4.076 trillion (down from $4.687 trillion) of the $8.292 trillion in total money fund assets (or 49.2%) tracked by Crane Data. (Note: Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our May 12 News, "May MF Portfolio Holdings: Treasuries Plunge, Repo and Agencies Rise.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.886 trillion (down from $2.063 trillion a week ago), or 46.3%; Repurchase Agreements (Repo) totaling $1.437 trillion (down from $1.710 trillion a week ago), or 35.2%, and Government Agency securities totaling $432.6 billion (down from $494.0 billion a week ago), or 10.6%. Commercial Paper (CP) totaled $138.4 billion (down from $166.6 billion a week ago), or 3.4%. Certificates of Deposit (CDs) totaled $77.2 billion (down from $104.9 billion a week ago), or 1.9%. The Other category accounted for $63.6 billion or 1.6%, while VRDNs accounted for $40.8 billion or 1.0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.886 trillion, Fixed Income Clearing Corp with $523.6B, the Federal Home Loan Bank with $276.8B, JP Morgan with $152.0B, Citi with $100.4B, Federal Farm Credit Bank with $89.8B, RBC with $88.1B, Wells Fargo with $85.2B, BNP Paribas with $76.8B and Credit Agricole with $51.5B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan 100% US Trs MM ($336.9B), JPMorgan US Govt MM ($324.8B), Fidelity Inv MM: Govt Port ($283.0B), Goldman Sachs FS Govt ($271.8B), State Street Inst US Govt ($211.1B), Morgan Stanley Inst Liq Govt ($210.3B), BlackRock Lq Treas Tr ($189.0B), BlackRock Lq FedFund ($186.9B), Fidelity Inv MM: MM Port ($163.8B) and Dreyfus Govt Cash Mgmt ($162.1B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)
UBS Files for Stablecoin Reserves
A filing for the new UBS Liquid Reserves Fund explains, "The fund invests only in certain eligible reserve assets that payment stablecoin issuers are permitted to maintain under the Guiding and Establishing National Innovation for US Stablecoins Act (the 'GENIUS Act') and any regulations adopted thereunder. These eligible reserve assets include, and the fund intends to invest only in, cash, securities issued by the US Treasury with a remaining maturity of 93 days or less or issued with a maturity of 93 days or less, and overnight repurchase agreements collateralized by securities issued by the US Treasury and cash. The fund primarily intends to serve as a reserve asset for stablecoin issuers. The fund does not invest in stablecoins or stablecoin issuers. The fund has adopted a policy to invest 99.5% or more of its total assets in cash, government securities, and/or repurchase agreements that are collateralized fully (i.e., collateralized by cash and/or government securities) in order to qualify as a 'government money market fund' under federal regulations." It explains, "UBS Asset Management (Americas) LLC ('UBS AM') acts as the investment advisor. As investment advisor, UBS AM makes the fund's investment decisions. UBS AM selects money market instruments for the fund based on its assessment of relative values and changes in market and economic conditions.... Shares of the fund are expected to be held primarily by one or more stablecoin issuers as all or a portion of the reserve assets that back the outstanding stablecoins issued to their customers. Stablecoins generally are a type of cryptocurrency that are designed to maintain a stable value by pegging their value to another asset, such as a fiat currency like the US dollar, and stablecoin holders generally are permitted to redeem their stablecoins for a fixed amount of value. Although the fund does not invest in stablecoins or stablecoin issuers, the assets of the fund are expected to fluctuate depending on the creation (minting) of additional stablecoins or the redemption (burning) of outstanding stablecoins. Stablecoins and other digital assets that stablecoins may be used to purchase or sell may face periods of uncertainty and volatility that result in the potential for rapid or unexpected requests by one or more stablecoin issuers to redeem or purchase the fund's shares.... The minimum investment level for initial purchases generally is $1,000,000 for Institutional Shares; $50,000,000 for Preferred Shares; and $500,000,000 for Ultra Shares, as determined on a household basis." UBS also launched UBS Select 100% US Treasury - Token-Enabled share class (TOKXX) earlier this year for BNY's LiquidityDirect portal. (See the filing for TOKXX here.) Rob Sabatino, UBS AM Head of Global Liquidity Portfolio Management, comments, "Offering a GENIUS Act-compliant MMF in addition to a token-enabled MMF reflects UBS Asset Management's commitment to modernizing liquidity management. We are meeting the evolving needs of both traditional and digital-native clients by combining the stability of institutional cash strategies with the efficiency of tokenized infrastructure. This builds on our broader digital asset initiatives, including the 2024 launch of the UBS USD Money Market Investment Fund Token ('uMINT'), our tokenized money market fund in Singapore."
Bloomberg: MMF Assets Record $8.3T
Bloomberg writes that the "Dash for Cash Sends Money-Fund Assets to Record $8.3 Trillion." The article states, "Investors boosted the total amount in US money-market funds to a record $8.281 trillion as uncertainty surrounding the Federal Reserve's monetary policy path fuels demand for cash-like assets. Some $66 billion rushed into the money-market fund industry in the week ending May 28, according to the latest figures from Crane Data LLC. About $41 billion of that came on Thursday as investors adjusted their portfolios before month's end. In all, the funds have attracted about $172 billion so far this year." The piece tells us, "The recent inflows have come as traders abandoned bets that the Federal Reserve will resume cutting interest and began wagering that a hike would be needed to help quell a resurgence of inflation tied to the Iran war. Swaps markets imply a roughly 60% chance that officials increase rates by a quarter-point this year. To Deutsche Bank strategist Steven Zeng, the recalibration is fueling demand for front-end US rates, which -- along with other types of short-term securities -- make up the holdings of most money-market funds. As Fed expectations shifted from cuts to hikes, much of that repricing is captured in the bill curve, meaning more attractive yields,' he said." Bloomberg adds, "Appetite for money-market funds has been rising for years thanks to their attractive yields and ease of access for investors ranging from Wall Street professionals to corporate treasurers and everyday American savers. The funds also tend to be faster than other investment vehicles to pass along higher yields to investors. The seven-day average yield for US money funds was 3.34% as of May 28, according to Crane Data."
