​ Money Funds Seeing Inflows From Government Investment Pool Woes. The flow of cash from lightly regulated and non-​AAA rated local government investment pools into money market mutual funds has accelerated over the past week as Floridian and other cities and towns seek a safer haven for their cash balances. Investors in the frozen $​15 billion Florida State Board of Administation'​s Local Government Investment Pool, which astonishingly attempted to stop its bleeding by halting redemptions (​see our News from yesterday "​State Board Halts Redemptions in Florida Local Govt Investment Pool"), are moving balances into money funds. The Palm Beach Post quotes County School District Treasurer Leanne Evan, "We are looking for a safe place to put taxpayer dollars." The South Florida Business Journal adds, "​The county [​Palm Beach] said it is investing incoming funds in money market accounts offered by AIM Investment and Federated Investors and is looking into other short-​term investments." Florida'​s move and aggressive investing has already damaged the $​300+ billion local government investment pool market. Fortunately, most other state pools are AAA rated and sport yields similar to money funds. See also Bloomberg "​Florida Schools Struggle to Pay Teachers as Investments Frozen".

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