The April issue of Crane Data's Money Fund Intelligence newsletter, which was e-mailed to subscribers Friday morning, features the articles: "A Little Too Quiet on Reg. Front; Waiting for White," which again talks about potential pending regulations; "S&P's Rizzo & Friedman Talk MFs, 'AAAm' Ratings," which profiles two ratings agency veterans; and, "Worldwide Money Fund Assets Q4'12: U.S. Jumps," which discusses the latest statistics on money funds globally. We've also updated our Money Fund Wisdom database query system with March 31, 2013, performance statistics and rankings, and our MFI XLS will be sent out shortly. Our March 31 Money Fund Portfolio Holdings are scheduled to go out on Wednesday, April 10. Note that we've also made some changes to the agenda for Crane's Money Fund Symposium, which will be held June 19-21, 2013, in Baltimore, Md. Registrations ($750). We urge attendees to book hotel reservations soon via our website at www.moneyfundsymposium.com.
Our piece on the SEC and FSOC says, "After months of seemingly nonstop heated discussion on potential pending money fund regulatory proposals, the debate has suddenly gone quiet. While the nomination of Mary Jo White to head the SEC, which is expected as soon as next week, may move things forward again, there remain no imminent SEC or FSOC proposals. But while we didn't get a proposal by the end of the first quarter, many expect the SEC to issue one within another month or two. We'll wager that it'll be a little longer still."
MFI also writes in its monthly "profile," "This month, Money Fund Intelligence interviews Standard & Poor's Financial Services' Peter Rizzo, Managing Director and Joel Friedman, Senior Director in S&P's Funds Ratings Group. Each of them have been involved in rating money funds for over 20 years, and S&P's funds rating business is preparing to mark its 30th anniversary later this year. S&P currently rates about 450 funds 'AAAm' for principal stability which account for $2.48 trillion globally. Our Q&A follows."
The article on Worldwide Money Fund Assets explains, "The Investment Company Institute released its latest Quarterly Worldwide Mutual Fund data yesterday for Q42012. Crane Data pulled out the money market information and analyzed the latest results. Money market fund assets worldwide rose by $154.5 billion, or 3.3%, during Q4 to $4.973 trillion. They rose by $97.8 billion, or 2.1%, during 2012 overall."
The piece adds, "U.S. money fund assets continue to make up the majority of all assets worldwide. U.S. assets jumped by $142.2 billion in the 4th quarter to $2.694 trillion, which is 59.4% of all money fund assets. For 2012, US MMF assets rose by just $2.1 billion, or 0.1%." (To request our latest spreadsheet of worldwide assets, e-mail Pete and ask us to send it.)
In other news, Reuters writes "As yields dwindle, 'cash' fund investors take on more risk". It says, "A hunt for higher yields by risk averse investors is helping spark a resurgence in funds that can invest more broadly and take bigger risks than strictly regulated money market funds. The growth in these so-called cash funds, however, is worrying for some who see it as another symptom that the Federal Reserve's ultra loose monetary policy is bringing on another broad credit boom that could end badly for borrowers, lenders and investors."
It explains, "Assets in these funds that have average weighted maturities up to a year, excluding exchange-traded funds, have grown to $48 billion as of February 2013, from $36.4 billion at the end of 2011, according to data by Lipper. At the end of 2008 there was just $12.1 billion in the funds. BlackRock, Oppenheimer, Pioneer, Fidelity and Putnam are among those that have launched such funds in the past two years."
The piece quotes, "The history of mutual funds is the story of demand creating its own supply," said Peter Crane, President of Crane Data, which analyses money fund investments. Crane said the main risk is the possibility of an investor exodus on concerns about what the funds are exposed to, as happened in the crisis on concerns over asset-backed exposures at both regulated money funds and enhanced cash alternatives. Many of the newer funds have not been tested in an environment of volatile or falling markets. Investors that hunt out higher yields for yields' sake may be among the most likely to run at the first sign of trouble, Crane said."
Finally, ICI's latest "Money Market Mutual Fund Assets" says, "Total money market mutual fund assets increased by $2.61 billion to $2.631 trillion for the week ended Wednesday, April 3, the Investment Company Institute reported today. Taxable government funds decreased by $2.25 billion, taxable non-government funds increased by $4.40 billion, and tax-exempt funds decreased by $460 million."
