"Money-Market Fund Yields May Fall to Less Than Zero, Crane Says" writes Bloomberg. (Note: You can hear Pete Crane discuss this topic on Bloomberg Radio at 2:50pm EST and on Bloomberg TV at 4:12pm EST.) "Investors in money-market mutual funds that focus on U.S. Treasuries may lose money for the first time if the Federal Reserve cuts interest rates next week and yields become too small to cover expenses," says the article by Christopher Condon. "Record-low yields on government debt have already led money-market funds to waive fees to keep returns positive. If the Federal Open Markets Committee, as expected, cuts its target rate, some Treasury funds may allow returns to turn negative, said Peter Crane, president of Crane Data LLC, a money-fund research firm in Westborough, Massachusetts." It quotes Crane, "No one has ever paid above and beyond their interest income to be in a fund.... But if we see another cut, we'll likely see negative yields." Finally, the piece adds, "Money-market managers could impose a system of incremental debits or charge monthly account fees, Crane said."
