The Federal Reserve released its latest quarterly "Z.1 Financial Accounts of the United States" statistical survey (formerly the "Flow of Funds") yesterday. Among the 4 tables it includes on money market mutual funds, the First Quarter 2020 edition shows that Total MMF Assets increased by $703.7 billion to $4.338 trillion in Q1'20, confirming the gigantic buildup of cash during the March coronavirus shutdown. The Household Sector, by far the largest investor segment with $2.648 trillion, saw assets jump in Q1, as did the next largest segment, Nonfinancial Corporate Businesses, as both businesses and individuals scrambled to get liquid in March.
The Fed's latest Z.1 numbers, which contain one of the few looks at money fund investor segments available, also show a slight asset increase in MMF holdings for the Other Financial Business (formerly Funding Corporations) and the Rest of the World category in Q1 2020. Private Pension Funds, Nonfinancial Noncorporate Business, Life Insurance Companies and State & Local Government Retirement also saw assets increase in Q1. State & Local Govts and Property-Casualty Insurance, were the only segments to see decreases. Over the past 12 months, the Household Sector, Nonfinancial Corporate Businesses and Other Financial Business showed the biggest asset increases. Every category showed except Property-Casualty Insurance saw increases over the past year.
The Fed's "Table L.206," "Money Market Mutual Fund Shares," shows that total assets increased by $695 billion, or 19.1%, in the first quarter to $4.338 trillion. Over the year assets were up $1.259 trillion, or 40.9%. The largest segment, the Household sector, totals $2.648 trillion, or 61.0% of assets. The Household Sector jumped by $500 billion, or 23.3%, in the quarter, after increasing $85 billion in Q4'19. Over the past 12 months through Q1'20, Household assets were up $822 billion, or 45.0%.
Nonfinancial Corporate Businesses, the second-largest segment according to the Fed's data series, held $666 billion, or 15.4% of the total. Assets here rose by $89 billion in the quarter, or 15.5%, and they've increased by $194 billion, or 41.0%, over the past year. Other Financial Business was the third-largest investor segment with $334 billion, or 7.7% of money fund shares. They rose by $25 billion, or 8.0%, in the latest quarter. Other Financial Business has increased by $82 billion, or 32.7%, over the previous 12 months.
The fourth-largest segment, Private Pension Funds held 4.0% of money fund assets ($173 billion), up by $8 billion (4.8%) for the quarter, and up $12 billion, or 7.1%, for the year. The Rest of the World, category which held $155 billion (3.6%), was in 5th place. The Nonfinancial Noncorporate Business remained sixth place in market share among investor segments with 3.3%, or $142 billion, while Life Insurance Companies held $92 billion (2.1%), State and Local Government Retirement Funds held $83 billion (1.9%), State and Local Governments held $24 billion (0.6%) and Property-Casualty Insurance held $22 billion (0.5%) according to the Fed's Z.1 breakout.
The Fed's "Flow of Funds" Table L.121 shows "Money Market Mutual Funds" largely invested in "Debt Securities," or Credit Market Instruments, with $2.569 trillion, or 59.2% of the total. Debt securities includes: Open market paper ($225 billion, or 5.2%; we assume this is CP), Treasury securities ($1.268 trillion, or 29.2%), Agency and GSE-backed securities ($931 billion, or 21.5%), Municipal securities ($131 billion, or 3.0%) and Corporate and foreign bonds ($19 billion, or 0.5%).
Other large holdings positions in the Fed's series include Security repurchase agreements ($1.468 trillion, or 33.8% of total assets) and Time and savings deposits ($239 billion, or 5.5%). Money funds also hold minor positions in Miscellaneous assets ($84 billion, or 1.9%), Foreign deposits ($4 billion, 0.1%) and Checkable deposits and currency (-$26 billion, -0.6%). Note: The Fed also lists "Variable Annuity Money Funds," which currently total $47 billion.
During Q1, Debt Securities were up $387 billion. This subtotal included: Open Market Paper (down $12 billion), Treasury Securities (up $231 billion), Agency- and GSE-backed Securities (up $176 billion), Corporate and Foreign Bonds (down $5 billion) and Municipal Securities (down $3 billion). In the first quarter of 2020, Security Repurchase Agreements were up a huge $293 billion, Foreign Deposits were down $4 billon, Checkable Deposits and Currency were down $27 billion, Time and Savings Deposits were down by $19 billion, and Miscellaneous Assets were up $73 billion.
Over the 12 months through 3/31/19, Debt Securities were up $674B, which included Open Market Paper up $9B, Treasury Securities up $388B, Agencies up $275B, Municipal Securities (down $4), and Corporate and Foreign Bonds (up $5B). Foreign Deposits were up $2 billon, Checkable Deposits and Currency were up $6B, Time and Savings Deposits were up $14B, Securities repurchase agreements were up $488B and Miscellaneous Assets were up $75B.
Note that the Federal Reserve changed its numbers related to money market funds substantially in the second quarter of 2018. Its "Release Highlights Second Quarter 2018" tells us, "New source data for money market funds from the U.S. Securities and Exchange Commission's (SEC) form N-MFP have been incorporated into the sector's asset holdings (tables F.121 and L.121). Money market funds not available to the public, which are included in the SEC data, are excluded from Financial Accounts' estimates. Data revisions begin 2013:Q1. Holdings of money market fund shares by households and nonprofit organizations, state and local governments, and funding corporations (tables F.206 and L.206) have been revised due to a change in methodology based on detail from the Investment Company Institute. Data revisions begin 1976:Q1."
