Schwab's Marie Chandoha on CNBC
Charles Schwab Investment Management's CEO Marie Chandoha appeared on CNBC yesterday, and made a couple of comments involving money market mutual funds. She told Tyler Mathieson in an interview, "One of the things that we saw was an uptick in equity flows, and what was interesting was, it was coming from money funds and moving into equity. So, people weren't rotating from fixed-income to equities, they were taking money out of cash and putting it into equities." Mathieson says, "Let's talk a little bit about those money funds, from where money seems to be flowing. You have waived something like $150 million in fees in just the first quarter because the interest rates are so low.... What kind of a drain is that and how long can you keep doing that?" Chandoha comments, "The reality is, money funds are really a core investment for clients. Clients need to put their cash somewhere, and money funds are a key vehicle for that. We still make some money on our money funds ... there's still a little bit left there to make. But we are waiving substantial fees.... Hopefully at some point, the Fed raises interest rates and we'll begin to make [more] money again."
