Federated Sets Record Straight on Muni Money Fund Risk From Insurers. In a conference call with investors yesterday, Federated Investors discussed rumors and concerns in the marketplace over municipal debt and monoline insurers, and addressed any potential impact to money market funds. Federated Senior VP and CIO Debbie Cunningham said as of early January, "The liquidity crunch has officially ended," citing the drop in LIBOR rates and the Fed's recent statement that "Strains in the money markets have eased somewhat". She added, "Federated remains very comfortable with the issuers in all of its money funds". Mary Jo Ochson, Senior VP and CIO of Federated's Tax-Exempt Money Market Group expanded on the issues in the tax exempt marketplace, saying, "We have total confidence in the 'put' process." She explained that funds rely on the bank or broker for liquidity of variable rate demand notes (VRDNs), not on the insurers. Regarding tender option bonds, she expressed confidence, adding, "TOBs were created by investors, not Wall Street."

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