The June issue of Crane Data's Money Fund Intelligence publication and our Money Fund Intelligence XLS with May 31 month-end performance data and rankings were distributed to subscribers Tuesday. This month's feature articles include: "Money Funds Under Siege; SEC Roundtable, Fed Hit $1," which discusses the raging debate over the future of money fund regulations; "Reich & Tang Does Daily MMFs & FDIC Sweeps," which interviews RNT Chief Strategist Tom Nelson; and "Moody's Ratings Changes Shift AAA Landscape," which talks about the agency's mysterious retreat from rating money market funds. Crane Data also updated its Money Fund Wisdom database software, and issued a final reminder for this month's Crane's Money Fund Symposium conference in Philadelphia, June 22-24.
Our "Under Siege" article comments, "At the start of 2011, not a soul had come out in favor of a floating NAV or even radical change for money market funds, other than long-time nemesis Paul Volcker. Now, however, it seems like the world outside of the money fund industry is hell-bent on destroying the $2.7 trillion sector. In May, The Wall Street Journal editorial Page, Banking Regulators at the recent SEC Roundtable, and even some Federal Reserve members all came out in favor of radical surgery." The piece explains, under the subtitled, "Roughed Up by Roundtable," "The May 10 'Money Market Funds and Systemic Risk Roundtable' was held to address, "The potential for money market funds to pose a systemic risk to broader financial markets -- what makes money market funds vulnerable to runs.... [and] Possible options for further regulatory reform and their implications, including floating NAV, bank regulation, and options that reflect a hybrid of these regulatory approaches: a private liquidity bank; mandatory reserve or capital requirements; and liquidity fees."
This month's fund family profile "interviews Tom Nelson, Chief Strategist for the Reich & Tang, manager of the Daily Income Funds, the new RNT Natixis Liquid Prime Portfolio, and Reich & Tang Insured Deposits, an FDIC-insured sweep program." It asks, "How long has Reich & Tang been involved in running money funds? Nelson says, "Reich & Tang has been managing money funds since 1974. It is one of the largest firms in the nation focused solely on liquidity and cash management services. From the beginning we have focused within the retail channel and were at the forefront of the brokerage sweep business, which continues to grow nicely today. (Look for more profile excerpts on www.cranedata.com later this month.)
The June issue also discusses recent changes in money fund AAA ratings. We write, "In mid-May, Moody's became the latest ratings agency to alter its money market fund rating scale. Though the change didn't cause as much disruption as the NRSRO's original proposal undoubtedly would have, the move still caused waves, especially among smaller advisors. The change was accompanied by a flurry of press releases announcing a number of withdrawn ratings. Mutual fund news service ignites wrote that "Dozens of Money Funds Drop Moody's Ratings," saying, "Moody's now rates 291 money funds; in September it rated 338."
Every month, Crane Data publishes its 30-page Money Fund Intelligence newsletter, which contains articles, news, indexes, rankings and performance statistics on money market mutual funds and "cash" investments. We also produce its "complement," Money Fund Intelligence XLS, which has additional data and rankings; Crane Index, a subset with cash indexes and averages; and, we update Money Fund Wisdom, our online database query system, with all of our monthly data and products. Note that our next Money Fund Portfolio Holdings collection is scheduled for distribution on June 14.
