Daily Links Archives: April, 2007

FDIC Chair Sheila Blair will speak at the annual meeting of the American Securitization Forum, a group representing asset-backed commercial paper (ABCP) issuers, on June 6, 2007, in New York City. The program agenda may be seen here.

Sunday's Wall Street Journal Says "Watch Out for Paltry Cash Sweep Interest" and discusses recent regulatory proposals. While disclosure has improved, the piece says, many investors remain unaware of the lower returns on sweeps.

"Federated Investors profits rise amid money fund demand" says Reuters UK. Federated (FII) will host a conference call this morning on their Q1 earnings.

Fitch Ratings Issues Report: "The Industrial Loan Company (ILC) Quandary: What Can Be Done?" discussing the commercial bank "loophole" that companies like Merrill, UBS, Morgan Stanley and GMAC have used to form banks in Utah.

BBC News reports on "Why rates leave savers deflated", saying many savings products trail inflation in the U.K. It also says that (as in the U.S.) ING Direct (UK) is reducing rates as the market raises them.

"Mutual fund derivatives plays heighten risk" in bond funds says Investment News. The piece warns advisors and funds to disclose risks to investors seeking yield.

"Do You Need an AMT-Free Mutual Fund?" asks The Wall Street Journal. It discusses the trend of funds, including money funds, avoiding the alternative minimum tax.

Citi Online Investments Adds Features to its Money Market Trading Portal. The new site includes a demo, a web seminar "Investment Trends 2007" and a listing of the money funds available.

Countrywide Bank Issued a Press Release Saying "Pay Yourself By Saving" your tax refund or bonus. The consistently high-yielding bank criticizes passbook savings "paying less than two percent".

"Money Fund Asset Growth on Track to Beat 2006" says Financial Week. The publication quotes our Peter Crane, "Inflows remain unusually strong," and includes a monthly Crane Data ranking of the top-performing money funds.

Fifth-largest money fund advisor (by Crane Data) Federated Investors (FII) reports First Quarter 2007 Earnings April 26 with a conference call Friday, April 27. We show Federated's money fund assets growing $6.7 billion, or 4.6%, to $154 billion vs. an overall industry gain of 3.4%. Their market share increased from 6.9% to 7.0%, so it likely was a very good quarter.

This concise and helpful Sample Investment Policy Guide from SVB Asset Management is meant "to establish a board approved set of guidelines for investment of your company's corporate cash".

See the original "Request for Rulemaking to Amend Rules 15c3-1 and 15c3-3". Federated Investors initial 2003 petition to change the definition of qualified securities to include money funds for meeting customer reserve deposit requirements.

Investment News "SEC Proposes Rules on Cash Sweep Practices" cites recent SEC Amendments to Financial Responsibility Rules for Broker-Dealers that require quarterly disclosure on sweeps. The proposed rules should steer clients from banks to money funds. The article cites a class action lawsuit against Citigroup, Merrill, and Morgan Stanley alleging that sweep programs weren't disclosed adequately.

Kiplinger's Personal Finance writes "Smart Places to Park Your Tax Refund in its May issue. The brief suggest money market funds and high-yield savings accounts.

IRS (Internal Revenue Service) Tax Statistics Page shows data such as current Filing Season Statistics. Through late March, refunds were running 5.7% ahead of last year, $152.8 billion.

PNC Releases Its April 2007 National Economic Outlook. Chief Economist Stuart Hoffman discusses the results of a PNC Economic Outlook Survey and March's strong 180,000 payroll growth numbers.

The Investment Company Institute's General Membership Meeting, the mutual fund industry's largest conference, will be held May 9-11 in Washington, DC, at the Marriott Wardman Park Hotel.

SIFMA Issues Auction Rate Securities Guidelines Reports InvestmentNews. Model auction procedures, Best Practices for ARS Dealers, and sample disclosure language are included in the SIFMA press release.

Shareholders voted to merge TIAA-CREF's Retail Mutual Funds into the complex's Institutional Funds. TIAA-CREF Money Market Fund (TIAXX) will be merged into TIAA-CREF Institutional Money Fund (TIRXX).

Bloomberg's Chet Currier writes "Bond-Fund Buyers Share the Cost in Economic Pinch". He questions the wisdom of inflows into intermediate bond funds, citing high yields on money market funds. The piece quotes Jean-Marie Eveillard, "Bonds are an accident waiting to happen."

Economic Commentary by Federated Investors Deborah Cunningham. She says, "The fixed income market has its eye on the sub-prime mortgage market and the Fed".

Smart Money on "The Alternative Minimum Tax" describes the tax and whether you should prepare for it.