The November issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Friday morning, features the articles: "Callahan, Cunningham on Future of Money Funds," which highlights comments from our recent Money Fund Symposium Online; "ICI's Stevens Tells Symposium: MMFs Didn't Drive Crisis," which quotes from Paul Schott Stevens' MFS keynote speech; and, "Corporates Discuss Liquidity, Prime During AFP Virtual," which covers a cash investment session from the recent AFP 2020 Virtual Experience. We've also updated our Money Fund Wisdom database with October 31 statistics, and sent out our MFI XLS spreadsheet Friday a.m. (MFI, MFI XLS and our Crane Index products are all available to subscribers via our Content center.) Our November Money Fund Portfolio Holdings are scheduled to ship on Tuesday, November 10, and our November Bond Fund Intelligence is scheduled to go out Monday, November 16.

MFI's lead article says, "Our latest webinar included a session on 'The Future of Money Funds & Cash,' which featured our Peter Crane moderating a panel with Tom Callahan of BlackRock and Debbie Cunningham of Federated Hermes. The three discussed the money fund business overall, prime exits, ESG, portals, technology and potential regulatory changes."

On future reforms, Callahan comments, "Broadly, we think that there needs to be a reform of the commercial paper market and secondary trading, because secondary market liquidity really doesn't exist when you need it in the CP market. Whatever happens to prime funds ... if the CP market isn't fixed in the next crisis, the Fed is going to be right back in bailing the CP market out.... We think there needs to be changing around how banks are able to intermediate and how CP sits on bank balance sheets to make the most logical intermediary more available in these markets when they're needed."

Our latest "Profile" reads, "We recently hosted "Crane's Money Fund Symposium Online," which began with the keynote speech, 'Covid's Impact on Money Markets,' from Investment Company Institute President & CEO Paul Schott Stevens. He tells us, 'Thank you, Pete, for that introduction and for the opportunity to join you.... This conference, virtual though it is, is just another example of the invaluable service that Crane Data and you Pete personally provide to the fund industry and to cash managers everywhere.... I thank you most sincerely for your contributions and for your friendship."

He explains, "As you've alluded to, this conference is one of my last public events as President and CEO of ICI. In January, I announced my retirement effective at year end.... It's been 16 1/2 years in this role. Earlier this month, the institute's board unanimously elected a new president and CEO Eric Pan, who will take the reins on Nov. 9th.... I'm pleased to be leaving ICI in such capable hands."

Stevens says, "I spent nearly half of my working life at ICI. Before I leave, I have one last assignment directing the completion of a comprehensive report on the market turmoil triggered by the Covid-19 pandemic and the economic restrictions that governments imposed in response. We are focusing especially on the experiences of regulated funds in that episode. We are currently publishing that report as a series of research papers, and the next paper we publish will look at money market funds, which landed back in the headlines in March because institutional prime funds had outflows, and because the Federal Reserve created a Money Market Mutual Fund Liquidity Facility to add liquidity to the markets and restore the flow of credit to the economy. (Note: ICI released its "Report of the Covid-​19 Market Impact Working Group: Experiences of US Money Market Funds During the COVID-​19 Crisis" yesterday.)

The "Corporates" article tells readers, "The Association for Financial Professionals' held its 'AFP2020 Virtual Experience' (see our Oct. 8 Link of the Day, 'AFP2020 to Feature ICD, More Cash') over the last two weeks in October. While it didn't hold a candle to the live event, there were a handful of interesting sessions discussing cash investments, including one entitled, 'Aligning Investment Strategy with Your Company's Operations.' This panel, led by Sebastian Ramos of ICD, featured Kim Kelly-Lippert of American Honda, Ryan Seghesio of California ISO and Tom Wolfe of MGM Resorts."

Kelly-Lippert says, "Pre-covid, we were big proponents of the prime funds.... In addition to the prime funds, we utilize government money market funds, bank deposits, euro time deposits, and then for some additional yield pickup we occasionally took advantage of a very selective [group of] asset-backed securities. But the majority of our liquidity was available overnight. We redeem the funds out of our money market funds for our daily obligations."

The latest MFI also includes the News piece titled, "Federated's Donahue Asked About Regs," which says, "During their Q3 earnings call, he comments, 'I believe that the thing that’s being talked about the most is the restriction on that 30% [liquidity] trigger.... It caused more problems than it solved. And there are a lot of ways around that. If the SEC wants to keep the trigger, fine. You just don't have to do the things that wave a red flag in front of the marketplace. Ameliorating the impact of that 30% is the number one thing that's being discussed. [M]oney market funds came through this situation much like they did before, with a lot of resilience. Therefore there is no need to further diminish prime funds.... We just don't think that it makes a lot of sense to eliminate the spear point of the short term markets at this time. So what will happen with regulation? I cannot predict, but I can assure you that we will be in there defending the beauty and efficacy of prime money market funds.'"

A second news brief entitled, "SEC Statistics: Assets, Yields Down Again; Prime Drops Below $1 Trillion," tells us, "The Securities and Exchange Commission's latest 'Money Market Fund Statistics' summary shows that total money fund assets fell $117.8 billion in September to $4.863 trillion, the 4th decrease in a row but just the 5th over the past 25 months. The SEC shows Prime MMFs dropped by $145.6 billion in September to $992.8 billion (reflecting the reclassification of Vanguard Prime MMF), while Govt & Treasury funds rose $35.3 billion to $3.749 trillion. Tax Exempt funds decreased $7.5 billion to $121.1 billion. Yields were mixed in September with Prime and Govt & Treasury yields falling while Tax Exempt yields increased."

Our November MFI XLS, with October 31 data, shows total assets dropped by $46.8 billion in October to $4.748 trillion, after decreasing $121.2 billion in September $42.3 billion in August, $44.2 billion in July and $113.0 billion in June. Assets increased $31.6 billion in May, $417.9 billion in April and $688.1 billion in March. Our broad Crane Money Fund Average 7-Day Yield fell to 0.02% during the month, our Crane 100 Money Fund Index (the 100 largest taxable funds) sits at 0.03%.

On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA was unchanged at 0.19% while the Crane 100 was also 0.19%. Charged Expenses averaged 0.16% for both the Crane MFA and Crane 100. (We'll revise expenses on Monday once we upload the SEC's Form N-MFP data for 10/31.) The average WAM (weighted average maturity) for the Crane MFA and Crane 100 was 41 (up one day) and 45 days (up a day) respectively. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)

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