Daily Links Archives: June, 2024

Morningstar writes on "How Investors Can Outpace the Returns of Money Market Funds." They ask PIMCO's Jerome Schneider, "[H]ow attractive, for example, are money markets these days relative to other short-term opportunities?" Schneider responds, "[I]t's a $6 trillion question at this point in time, given the amount of assets that have flown into money markets over the past years. Listen, there's a great amount of opportunity for investors to be defensive and in fact safe by earning 5% plus or minus in money market and T-bill-like investments. We fully understand that, as investors, and understanding why people want to have that beautiful triumvirate of capital preservation, liquidity management, with some positive return for once. But what we also are finding is that there's a revealing aspect of fixed income right now that if you move just slightly beyond the money market space into that zero to one-year space in a more diversified portfolio, away from Treasury bills, away from money market strategies, that you can have additional opportunities through earning additional income as well as being senior in different opportunities for corporate bonds as well as asset-backed securities, which are quite attractive." He continues, "And it puts a total return metric well above 6% at this point in time without taking much interest-rate exposure at this point in time. Said a little bit differently, if investors have the horizon and comfort to put money to work over the course of the next six months of the year, effectively they can capture liquidity premiums, which allow them to earn and outpace the returns in a total return format versus being in a money market fund. And that's really the attractive spot that we haven't seen in quite a few years, perhaps dating back to 2015 when short-term strategies became once again in focus in a higher rate cycle." Schneider explains, "This, too, now lends itself to be very relevant for investors who want to be in that 6% to 8% returns without having a lot of aspects of taking a lot of risk, managing interest-rate exposure at the front of the curve, but yet having the time horizon to put money to work over the next few months or the next few quarters, there's attractive ways to do that. And so we would encourage, effectively, investors to tier their cash, think about what they need for same-day liquidity, keep that in money market funds, AAA rated, government guaranteed type of obligations, but to the extent they can tier their cash over the next few quarters, it makes it a very attractive opportunity whether you're an individual investor, a corporate cash CFO, or even a pension or foundation, if the opportunities are there to create those diversified portfolios away from the traditional mindset of cash management."

The Wall Street Journal writes that, "Americans Chasing High Interest Rates Risk Falling Into a 'Cash Trap'." The article says, "Americans have poured money into cash-like investments since the Fed began raising interest rates, driving assets in money-market funds to a record $6.12 trillion earlier this month, according to the Investment Company Institute. Now, Wall Street traders are betting rates have peaked and those investors face a choice: keep sitting on their cash as interest payments shrink, or figure out how to redeploy the money. Deciding when and how to rebalance a portfolio is challenging even for pros, and depends on factors including a person's age, savings and expected needs. But staying on the sidelines risks missing out on years of potential gains from holding a broad portfolio of stocks, bonds and other riskier investments. J.P. Morgan Asset Management calls it the 'cash trap.'" They quote Vanguard's John Croke, "If you've owned cash for the last year and a half, that view in the rearview mirror is pretty attractive and you feel good about yourself. But you have to remind yourself that that's the rearview mirror." The piece tells us, "Croke said long-term investors should return to a diversified bond portfolio so they can lock in attractive long-term yields before the Fed starts cutting rates . Savers might find that hard, with short-term rates at 5.25% to 5.5%, their highest level in two decades.... The decision could cost ... over the long run. Since the end of 2021, the Vanguard Federal Money Market Fund has returned 9.1% through the end of May. The S&P 500, meanwhile, rose 15.1% over the same period when including price changes and dividend payments. The Bloomberg U.S. Aggregate bond index has lost 9.7%, according to Dow Jones Market Data." The Journal piece adds, "Some investors cite reasons other than attractive interest rates for sticking to cash.... But investors shouldn't try to time the markets or invest based on their emotions, said David Kelly, chief global strategist at J.P. Morgan Asset Management. 'People generally feel negative and pessimistic,' he said. 'If they invest based on how they feel, they are going to hang on to cash forever.'"

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of June 21) includes Holdings information from 73 money funds (up 5 from a week ago), or $3.132 trillion (up from $3.126 trillion) of the $6.483 trillion in total money fund assets (or 48.3%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our June 12 News, "June Money Fund Portfolio Holdings: Repo Remains No. 1, Assets Jump.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.250 trillion (down from $1.407 trillion a week ago), or 39.9%; Repurchase Agreements (Repo) totaling $1.253 trillion (up from $1.195 trillion a week ago), or 40.0%, and Government Agency securities totaling $273.7 billion (up from $256.0 billion), or 8.7%. Commercial Paper (CP) totaled $118.4 billion (up from a week ago at $93.4 billion), or 3.8%. Certificates of Deposit (CDs) totaled $84.2 billion (up from $66.8 billion a week ago), or 2.7%. The Other category accounted for $110.9 billion or 3.5%, while VRDNs accounted for $42.0 billion, or 1.3%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.250 trillion (39.9% of total holdings), Fixed Income Clearing Corp with $307.1B (9.8%), Federal Home Loan Bank with $199.3B (6.4%), the Federal Reserve Bank of New York with $123.3 billion (3.9%), Citi with $87.3B (2.8%), JP Morgan with $81.8B (2.6%), BNP Paribas with $77.5B (2.5%), Federal Farm Credit Bank with $71.4B (2.3%), RBC with $71.3B (2.3%) and Bank of America with $54.2B (1.7%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($251.1B), Goldman Sachs FS Govt ($228.8B), JPMorgan 100% US Treas MMkt ($208.1B), Fidelity Inv MM: Govt Port ($198.6B), Federated Hermes Govt ObI ($156.7B), Morgan Stanley Inst Liq Govt ($151.7B), Fidelity Inv MM: MM Port ($130.0B), State Street Inst US Govt ($124.3B), Allspring Govt MM ($117.5B) and Dreyfus Govt Cash Mgmt ($112.6B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

Money fund yields were unchanged at 5.12% on average (as measured by our Crane 100 Money Fund Index) in the week ended June 21, after falling 2 basis points three weeks ago. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds fell by $21.0 billion last week to $6.483 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 710), shows a 7-day yield of 5.02%, unchanged in the week through Friday. Prime Inst MFs were unchanged at 5.18% in the latest week. Government Inst MFs were unchanged at 5.11%. Treasury Inst MFs were unchanged at 5.06%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.82%, and Prime Retail MFs yield 5.02%, Tax-exempt MF 7-day yields were up 48 bps at 3.34%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (6/21), 17 money funds (out of 830 total) yield under 3.0% with $612 million in assets, or 0.0%; 108 funds yield between 3.00% and 3.99% ($132.7 billion, or 2.0%), 256 funds yield between 4.0% and 4.99% ($1.332 trillion, or 20.6%) and 449 funds now yield 5.0% or more ($5.017 trillion, or 77.4%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.62%. The latest Brokerage Sweep Intelligence, with data as of June 21, shows that there was no changes over the past week. Five weeks prior we saw the removal of TD Ameritrade from the listings pushed the averages higher (2 bps). Three of the 10 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley. (Note: six weeks ago we removed rates for TD Ameritrade from BSI since it completed its merger with Charles Schwab.)

An Prospectus Supplement filing for the Empower Government Money Market Fund (Institutional Class Ticker: MXGXX and Investor Class Ticker: MXMXX) tells us, "Upon the recommendation of the Fund's investment adviser, Empower Capital Management, LLC, the Board of Directors of Empower Funds, Inc., on behalf of the Fund, approved a proposal providing for the complete liquidation of the Fund and the redemption of the Fund's outstanding shares. The liquidation is expected to occur on or about June 14, 2024. The Fund will be closed to new investors on or about May 14, 2024, however, the Fund will continue to accept purchases from existing shareholders (including reinvested dividends or capital gains) until one business day before the Liquidation Date." It continues, "Shareholders may exchange their shares of the Fund for shares of other available investment options or redeem their shares prior to the Liquidation Date. Shareholders whose shares are redeemed by the Fund on the Liquidation Date will receive the net asset value per share for all shares they own on the Liquidation Date. Because Fund shares are sold to tax deferred vehicles, the liquidation is not expected to be considered a taxable event to shareholders. Shareholders should consult their personal tax advisor concerning their particular tax circumstances."

BoardIQ writes "Advisors Purge Institutional Money Funds Ahead of Rule Deadline." The article explains, "Advisors are pulling the plug on institutional prime money market funds ahead of the compliance deadline for a new regulation industry advocates said is operationally burdensome. As many as half of the funds may disappear by the Oct. 2 deadline, said Peter Crane, president and CEO of researcher Crane Data. 'The big ones are no doubt going to hang in there,' he said. 'The smaller ones are all going to liquidate.'" The piece quotes Investment Company Institute associate general counsel Joshua Weinberg, "The mandatory liquidity fee for institutional prime money market funds is an over-engineered attempt at a solution, adopted without input from those required to implement it. As a result, fund sponsors are faced with a choice to either proceed with an expensive, burdensome and complex operational implementation or move away from offering investors choice." It tells us, "The 'exodus' is already underway, Crane said. UBS is among the latest and said last week in a pair of filings that it would convert its Select Prime Preferred and Select Prime Institutional funds into retail money funds with fluctuating share prices as of Aug. 16.... The firm last month also disclosed that it would convert its prime institutional Limited Purpose Cash Investment Fund to a government money-market fund, effective Aug. 27, Crane Data shows. The fund had about $5 billion in assets as of last October, according to fund filings. Mutual of America Capital Management also disclosed the conversion of an institutional money fund last week. Its $537 million MoA Money Market Fund will be converted to a government money fund effective on or about Aug. 23. Other money fund sponsors that have announced plans to pull certain prime institutional products include Allspring Heritage, American Funds, BlackRock, Dreyfus, DWS, Federated Hermes, Fidelity, Goldman Sachs and Vanguard, according to data from Crane Data. Almost all expect to exit between June and September." Finally, they write, "Crane said that the news wasn't all bad from the board perspective. 'The good news for directors is that the liquidity fee decisions were taken out of their hands, so I'm sure they're more than happy to leave it to the advisor,' he said. But directors now face the question of whether it's worth the risk to keep institutional prime funds around. For those with less than $5 billion, the answer is no, Crane said."

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of June 14) includes Holdings information from 68 money funds (up 9 from two weeks ago), or $3.126 trillion (up from $2.703 trillion) of the $6.504 trillion in total money fund assets (or 48.1%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our June 12 News, "June Money Fund Portfolio Holdings: Repo Remains No. 1, Assets Jump.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.407 trillion (up from $1.147 trillion two weeks ago), or 45.0%; Repurchase Agreements (Repo) totaling $1.195 trillion (up from $1.071 trillion two weeks ago), or 38.2%, and Government Agency securities totaling $256.0 billion (up from $241.4 billion), or 8.2%. Commercial Paper (CP) totaled $93.4 billion (up from two weeks ago at $87.3 billion), or 3.0%. Certificates of Deposit (CDs) totaled $66.8 billion (up from $64.7 billion two weeks ago), or 2.1%. The Other category accounted for $74.4 billion or 2.4%, while VRDNs accounted for $33.2 billion, or 1.1%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.407 trillion (45.0% of total holdings), Fixed Income Clearing Corp with $296.4B (9.5%), Federal Home Loan Bank with $192.2B (6.1%), the Federal Reserve Bank of New York with $101.0 billion (3.2%), JP Morgan with $84.5B (2.7%), Citi with $82.2B (2.6%), BNP Paribas with $79.5B (2.5%), RBC with $61.8B (2.0%), Federal Farm Credit Bank with $61.3B (2.0%) and Bank of America with $45.7B (1.5%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($247.0B), Goldman Sachs FS Govt ($229.6B), JPMorgan 100% US Treas MMkt ($206.0B), Fidelity Inv MM: Govt Port ($192.0B), Morgan Stanley Inst Liq Govt ($148.6B), BlackRock Lq FedFund ($145.0B), Fidelity Inv MM: MM Port ($129.5B), State Street Inst US Govt ($127.9B), Allspring Govt MM ($121.9B) and BlackRock Lq Treas Tr ($120.5B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

Money fund yields were unchanged at 5.12% on average (as measured by our Crane 100 Money Fund Index) in the week ended June 14, after falling 2 basis points two weeks ago. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $20.5 billion last week to $6.504 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 712), shows a 7-day yield of 5.02%, down 1 bp in the week through Friday. Prime Inst MFs were down 1 bp at 5.18% in the latest week. Government Inst MFs were unchanged at 5.11%. Treasury Inst MFs were down 1 bp at 5.06%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.82%, and Prime Retail MFs yield 5.02%, Tax-exempt MF 7-day yields were up 7 bps at 2.86%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (6/14), 75 money funds (out of 832 total) yield under 3.0% with $48.9 billion in assets, or 0.8%; 50 funds yield between 3.00% and 3.99% ($83.6 billion, or 1.3%), 256 funds yield between 4.0% and 4.99% ($1.328 trillion, or 20.4%) and 451 funds now yield 5.0% or more ($5.043 trillion, or 77.5%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.62%. The latest Brokerage Sweep Intelligence, with data as of June 14, shows that there was no changes over the past week. Four weeks prior we saw the removal of TD Ameritrade from the listings pushed the averages higher (2 bps). Three of the 10 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley. (Note: Five weeks ago we removed rates for TD Ameritrade from BSI since it completed its merger with Charles Schwab.)

Morgingstar asks, "Is It Time to Ditch Your Money Market Fund for Longer-Term Bonds?" The article comments, "Rate cuts are coming. It may not happen until September, December, or even 2025, but market watchers agree the Fed will eventually ease policy as inflation improves. That means those cushy 5% rates on money market funds will go lower. With the outlook for bonds looking better, strategists say investors should look to fixed income to lock in higher yields and protect their portfolios against market volatility in the second half of 2024. To be clear, bonds and cash serve very different functions in portfolios. Cash will always be the safest bet for short-term spending needs. Bonds, while safer than equities, will always carry some risk of losing money. The longer-term the bonds, the greater the risk of short-term price swings when interest rates rise or fall." The piece adds, "While money market returns may be attractive right now, investors will see them fall rapidly once the Fed's rate-cutting cycle begins.... Of course, this doesn't mean investors should liquidate their cash holdings and move into riskier investments in one go. Siluk says investors can extend duration slowly. Oftentimes, this process happens first through short-dated investment-grade bonds, and then more intermediate longer-dated bonds. Falling yields also mean more price appreciation for bonds, which investors can’t achieve with cash."

An SEC filing tells us, "In March 2024, the Board of Trustees of Vanguard Municipal Cash Management Fund (MCMT) approved (1) the reclassification of MCMT from an institutional tax-exempt money market fund to a short-term municipal bond fund, and (2) MCMT's name change to Vanguard Municipal Low Duration Fund.... Under the 'Cash Management' heading, the following replaces the first sentence: The Fund's (for Vanguard Variable Insurance Funds, 'The Portfolio's') daily cash balance may be invested in Vanguard Market Liquidity Fund, a low-cost money market fund, and/or Vanguard Municipal Low Duration Fund, a short-term municipal bond fund (each, a CMT Fund)."

The Wall Street Journal tells us, "The Era of Higher Savings and Bond Rates Is Still Going. Don't Waste It." They write, "Americans are still losing a lot of money on their money. As the Federal Reserve moved to tame inflation and raised interest rates over the past two years, the returns on bonds and other savings vehicles surged. Many people took advantage of the rising rates, but many others didn't. About $17.5 trillion sits in commercial banks, for example, and the average savings account earns 0.45% in interest a year, according to the Federal Deposit Insurance Corporation.... This is also a moment for those who did take advantage of better returns in high-yield savings, certificates of deposit, money-market funds and Treasury bonds. As the Fed gets set to change policy once again, they can't afford to be complacent." The piece comments, "The first step is moving emergency cash and cash needed for known expenditures, like tax payments, into higher-yielding online accounts, or money-market funds at a brokerage. In the past year, less than 20% of Americans moved their money into any account that offered a higher interest rate, according to Santander's survey. Older Americans are also more likely to have their money in a high-interest account and preferred using CDs and money-market accounts, the survey found, while millennials were more likely to choose high-yield savings accounts." The Journal adds, "Savvy investors have been moving their money from commercial banks into high-yielding cash instruments, said Peter Crane, president of Crane Data, a company that tracks the money-market industry. Since 2022, bank deposits have dropped from nearly $18 trillion to a little over $17.5 trillion. At the same time, the amount of cash in money-market funds has grown to record highs and currently sits at $6.4 trillion, an increase of more than $1 trillion from 2022. Both individual investors and institutions are drawn to the liquidity and high yields of this type of fund, which typically works by investing in short-term debt securities like Treasury bills. 'When yields hit 5%, it was like a bell ringing' Crane said. 'People are reawakening to the fact that they can live on cash yields with almost zero risk.'"

A press release titled, "Dreyfus Launches BOLD Future, Bringing the Power of BOLD to Retail Investors" tells us, "Dreyfus, BNY Mellon's affiliated liquidity manager, announced the launch of BOLD Future, a new share class for retail investors of the Dreyfus Government Cash Management fund. Building on the demand from institutional investors for BOLD, which stands for Black Opportunity for Learning and Development, BOLD Future will support Howard University's Graduation, Retention, and Access to Continued Excellence (GRACE) Grant by making an annual donation of 10% of the net revenue of the share class to a dedicated scholarship within the GRACE Grant." The release continues, "BOLD Future is designed to address the liquidity needs of financial advisors and their clients with an investment minimum of $25,000. BOLD Future is the latest innovation from Dreyfus in its 50th year as a leading provider of liquidity solutions." John Tobin, Chief Investment Officer at Dreyfus, says, "As one of the largest and most trusted cash and liquidity managers, we're delighted to deepen our partnership with Howard University and applaud their ongoing commitment to helping the highest-need students graduate. We are proud to have donated over $1 million to Howard University's GRACE Grant, powered by the strong commitment of our institutional clients. With the launch of BOLD Future, Dreyfus now offers financial advisors and their clients the same opportunity to make their money work harder by doing well and doing good." Ben Vinson, III, PhD, President of Howard University, comments, "Our partnership with Dreyfus is a game changer in eliminating financial barriers for Howard University students so that they focus more on completing college degrees, excelling in their chosen fields and advancing a more just and equitable society. Investing in the GRACE Grant not only strengthens retention and graduation rates, but also enables students to lead and succeed in making the world a better place for everyone. Our nation and the world stand to benefit from this type of transformative support as we move Howard forward toward maximum strength." For more on ESG and D&I MMFs, see these Crane Data News stories: "DWS Liquidating ESG Liquidity Fund, 7th Prime Inst to Exit; MM Basics" (5/22/24).

Money fund yields were down 2 bps to 5.12% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 31, after rising 1 bp the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $10.0 billion last week to $6.483 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 712), shows a 7-day yield of 5.03%, down 1 bp in the week through Friday. Prime Inst MFs were down 2 bps at 5.19% in the latest week. Government Inst MFs were down 1 bp at 5.11%. Treasury Inst MFs were down 1 bp at 5.07%. Treasury Retail MFs currently yield 4.85%, Government Retail MFs yield 4.83%, and Prime Retail MFs yield 5.03%, Tax-exempt MF 7-day yields were down 34 bps at 2.79%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (6/7), 97 money funds (out of 832 total) yield under 3.0% with $101.3 billion in assets, or 1.6%; 27 funds yield between 3.00% and 3.99% ($33.7 billion, or 0.5%), 255 funds yield between 4.0% and 4.99% ($1.331 trillion, or 20.5%) and 453 funds now yield 5.0% or more ($5.017 trillion, or 77.4%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was down 1 bp at 0.62%. The latest Brokerage Sweep Intelligence, with data as of June 7, shows that there was one change over the past week, RW Baird lowered rates to 1.92% for accounts of $1 to $999K, to 3.04% for accounts of $1M to $1.9M and to 3.96% for accounts of $5M and greater. Three weeks prior we saw the removal of TD Ameritrade from the listings pushed the averages higher (2 bps). Three of the 10 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley. (Note: Four weeks ago we removed rates for TD Ameritrade from BSI since it completed its merger with Charles Schwab.)

On Friday, BlackRock filed to liquidate 2 of its 3 Prime Institutional money market funds, bringing the number of Prime Inst MMFs liquidating or converting to Government to 12 to date (with total assets of $245.8 billion, or 38.7% the $635.8 billion in Prime Inst MMFs). A Prospectus Supplement dated June 7 for the $5.4 billion BlackRock Liquidity Funds - TempFund says, "On May 16, 2024, the Board of Trustees of BlackRock Liquidity Funds (the 'Trust') on behalf of its series TempFund, approved a proposal to close the Fund to new investors and thereafter to liquidate the Fund. Accordingly, effective at 3:00 p.m. (Eastern time) on June 14, 2024, the Fund will no longer accept purchase orders from new investors. On or about September 5, 2024 (the 'Liquidation Date'), all of the assets of the Fund will be liquidated completely, the shares of any shareholders holding shares on the Liquidation Date of the Fund will be redeemed at the net asset value per share and the Fund will then be terminated as a series of the Trust." It continues, "Shareholders may continue to redeem their Fund shares at any time prior to the Liquidation Date. In preparation for the liquidation, the Fund may deviate from its investment objective and principal investment strategies. Shareholders should consult their personal tax advisers concerning their tax situation and the impact of the liquidation on their tax situation." A second June 7 filing for the BlackRock Funds - BlackRock Liquid Environmentally Aware Fund, a "Prospectuses and Statement of Additional Information of the Fund," explains, "On May 16, 2024, the Board of Trustees of BlackRock Funds (the 'Trust'), on behalf of its series, BlackRock Liquid Environmentally Aware Fund (the 'Fund'), approved a proposal to close the Fund to new investors and thereafter to liquidate the Fund. Accordingly, effective 3:00 p.m. (Eastern time) on June 14, 2024, the Fund will no longer accept purchase orders from new investors to purchase Fund shares. On or about September 5, 2024 (the 'Liquidation Date'), all of the assets of the Fund will be liquidated completely, the shares of any shareholders holding shares on the Liquidation Date will be redeemed at the net asset value per share and the Fund will then be terminated as a series of the Trust." BlackRock adds, "Shareholders may continue to redeem their Fund shares at any time prior to the Liquidation Date. In preparation for the liquidation, the Fund may deviate from its investment objective and principal investment strategies. Shareholders should consult their personal tax advisers concerning their tax situation and the impact of the liquidation on their tax situation." BlackRock is not liquidating its $17.0 billion TempCash (TMCXX) Prime Inst portfolio, nor its $3.2 billion Prime Retail BlackRock Wealth LEAF (PINXX). For more on Prime Institutional MMF changes, see these Crane Data News stories: "Allspring to Merge Heritage MMF Into Govt MMF; UBS Converting Fund" (6/3/24), "DWS Liquidating ESG Liquidity Fund, 7th Prime Inst to Exit" (5/22/24), "Dreyfus Files to Liquidate Cash Management Prime Inst MMF, Tax Exempt" (5/13/24), "Goldman Files to Liquidate Prime Inst MMFs; Barron's: MMFs Tempting" (4/22/24), "Federated Liquidating Money Mkt Trust" (4/1/24), "Vanguard Market Liquidity Fund Files to Go Government, Joins American" (3/20/24) and "American Funds Central Cash to Convert to Govt to Avoid Liquidity Fees" (2/6/24).) For more on liquidations in the ESG MMF space, see these stories, "UBS Latest to Abandon ESG Money Funds; JNL Liquidates Money Fund" (10/13/23) and "Morgan Stanley Latest to Abandon ESG MMFs; Weekly, ICI Portfolio Holds" (8/16/23).

The Investment Company Institute published its latest weekly "Money Market Fund Assets" report, Thursday. ICI's weekly shows money market mutual fund assets rising for the seventh straight week to $6.093 trillion, just $18 billion below their April 3 record of $6.111 trillion. MMF assets are up by $206 billion, or 4.4%, year-to-date in 2024 (through 6/5/24), with Institutional MMFs up $48 billion, or 1.6% and Retail MMFs up $158 billion, or 9.4%. Over the past 52 weeks, money funds have risen by $636 billion, or 11.7%, with Retail MMFs rising by $465 billion (23.4%) and Inst MMFs rising by $171 billion (4.9%). The weekly release says, "Total money market fund assets increased by $23.14 billion to $6.09 trillion for the week ended Wednesday, June 5, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $16.37 billion and prime funds increased by $5.27 billion. Tax-exempt money market funds increased by $1.50 billion." ICI's stats show Institutional MMFs increasing $8.9 billion and Retail MMFs rising $14.3 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.921 trillion (80.8% of all money funds), while Total Prime MMFs were $1.041 trillion (17.1%). Tax Exempt MMFs totaled $130.7 billion (2.1%). ICI explains, "Assets of retail money market funds increased by $14.25 billion to $2.45 trillion. Among retail funds, government money market fund assets increased by $8.95 billion to $1.56 trillion, prime money market fund assets increased by $4.19 billion to $769.33 billion, and tax-exempt fund assets increased by $1.10 billion to $118.66 billion." Retail assets account for over a third of total assets, or 40.2%, and Government Retail assets make up 63.7% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $8.90 billion to $3.64 trillion. Among institutional funds, government money market fund assets increased by $7.42 billion to $3.36 trillion, prime money market fund assets increased by $1.08 billion to $271.55 billion, and tax-exempt fund assets increased by $393 million to $12.04 billion." Institutional assets accounted for 59.8% of all MMF assets, with Government Institutional assets making up 92.2% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have risen by $5.4 billion in June (through 6/5) to $6.479 trillion. (They hit a record $6.538 trillion on 4/2.) Assets rose by $91.4 billion in May, fell $15.8 billion in April and $68.8 billion in March. But they rose $72.1 billion in February, $93.9 billion in January, $32.7 billion in December and $226.4 billion in November. MMF totals fell by $31.9 billion in October. They rose $93.9 billion in September, $98.3 billion in August and $34.7 billion in July. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.

Bloomberg published the article, "Nvidia Leads Companies Minting Money as Interest Earned From Cash Surges." It explains, "With interest rates at more than decade-highs, corporate finance chiefs are finding that money can indeed beget money. Almost 1-in-10 non-financial companies in the S&P 500, or more than three dozen firms, earned more in interest income than they paid in debt expense during the first quarter, according to data compiled by Bloomberg based on members in the index that break out interest costs. While that number is largely unchanged from the prior-year period, the interest income reaped by those companies -- a cohort that includes Alphabet Inc., Tesla Inc. and Johnson & Johnson -- is up about 60%. Corporate cash piles swelled during the pandemic, and now that benchmark interest rates are north of 5%, companies are reaping higher returns by investing in money-market funds, government securities and certificates of deposit. That additional income stream is expected to keep flowing in, with Federal Reserve officials signaling a willingness to keep rates higher for an extended period." They quote Bank of America's Mark Cabana, "Corporates are earning more money by holding cash. Many companies are comfortable with where the economy is as well as with elevated cash levels, because they are getting a return for it." The piece continues, "One standout is chipmaker Nvidia Corp., which reported $359 million in interest income for the first quarter, more than double what it earned during the prior-year period and enough to cover quarterly interest expense of $64 million. Nvidia also reaped enough interest income to cover its $98 million dividend -- the only member of the S&P 500 to do so during the quarter. For the companies that report higher interest income than interest spending, interest income leaped almost 60% to $6.9 billion, compared with the first quarter of 2023.... Nvidia's cash hoard has ballooned in recent quarters, aided by a surge in demand for its chips that power artificial intelligence applications. The Santa Clara, California-based company now has more than $31.4 billion in cash, cash equivalents and short-term investments, up from $15.3 billion during the prior-year period. Like some of its peers, Nvidia is invested in money-market funds, reporting over $5 billion in holdings for the past quarter. The company also owns US government debt, corporate bonds and certificates of deposits, it said in a filing." The article adds, "Money-market fund holdings by institutional investors have grown by almost 20% since 2022, totaling about $3.63 trillion as of May 29. Corporates are believed to make up the lion's share of those holdings, Cabana said. With total holdings north of $6 trillion as of May 29, money-market funds have generated approximately $379 billion in returns over the past year, according to Crane Data LLC, which tracks money markets. 'As the economy keeps growing and we enter the seasonally stronger second half of the year, corporate cash levels should keep growing,' said Peter Crane, president of Crane Data. There may be temporary declines, he said -- for example around June 15, when many companies pay their taxes."

Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of May 31) includes Holdings information from 59 money funds (down 16 from a week ago), or $2.703 trillion (down from $3.366 trillion) of the $6.473 trillion in total money fund assets (or 41.8%) tracked by Crane Data. (Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our May 10 News, "May Money Fund Portfolio Holdings: Repo Jumps to No. 1, T-Bills Plunge.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.147 trillion (down from $1.472 trillion a week ago), or 42.5%; Repurchase Agreements (Repo) totaling $1.071 trillion (down from $1.266 trillion a week ago), or 39.6%, and Government Agency securities totaling $241.4 billion (down from $274.5 billion), or 8.9%. Commercial Paper (CP) totaled $87.3 billion (down from a week ago at $111.8 billion), or 3.2%. Certificates of Deposit (CDs) totaled $64.7 billion (down from $92.8 billion a week ago), or 2.4%. The Other category accounted for $61.5 billion or 2.3%, while VRDNs accounted for $29.3 billion, or 1.1%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.147 trillion (42.5% of total holdings), Fixed Income Clearing Corp with $236.6B (8.8%), Federal Home Loan Bank with $179.6B (6.6%), the Federal Reserve Bank of New York with $106.3 billion (3.9%), Citi with $76.3B (2.8%), JP Morgan with $69.8B (2.6%), BNP Paribas with $69.6B (2.6%), RBC with $61.7B (2.3%), Federal Farm Credit Bank with $59.9B (2.2%) and Goldman Sachs with $55.4B (2.1%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($253.6B), Goldman Sachs FS Govt ($229.5B), JPMorgan 100% US Treas MMkt ($204.5B), Fidelity Inv MM: Govt Port ($200.9B), Morgan Stanley Inst Liq Govt ($141.0B), Fidelity Inv MM: MM Port ($129.1B), State Street Inst US Govt ($120.9B), Allspring Govt MM ($119.0B), Dreyfus Govt Cash Mgmt ($111.2B) and Goldman Sachs FS Treas Instruments ($92.4B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)

Money fund yields were up 1 bp at 5.14% on average (as measured by our Crane 100 Money Fund Index) in the week ended May 31, after rising 1 bp the week prior. Our Crane 100 is an average of 7-day yields for the 100 largest taxable money funds. Yields were 5.13% on 4/30, 5.14% on 3/31 and 2/29/24, 5.17% on 1/31/24, 5.20% on 12/31/23, 4.94% on 6/30/23, 4.61% on 3/31/23 and 4.05% on 12/31/22. The vast majority of money market fund assets now yield 5.0% or higher. Assets of money market funds rose by $39.3 billion last week to $6.473 trillion according to Crane Data's Money Fund Intelligence Daily. Weighted average maturities were unchanged last week. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 713), shows a 7-day yield of 5.04%, up 1 bp in the week through Friday. Prime Inst MFs were up 1 bp at 5.21% in the latest week. Government Inst MFs were up 1 bp at 5.12%. Treasury Inst MFs were up 1 bp at 5.08%. Treasury Retail MFs currently yield 4.86%, Government Retail MFs yield 4.84%, and Prime Retail MFs yield 5.03%, Tax-exempt MF 7-day yields were down 13 bps at 3.14%. According to Monday's Money Fund Intelligence Daily, with data as of Friday (5/31), 24 money funds (out of 834 total) yield under 3.0% with $1.7 billion in assets, or 0.0%; 100 funds yield between 3.00% and 3.99% ($133.9 billion, or 2.1%), 246 funds yield between 4.0% and 4.99% ($1.320 trillion, or 20.4%) and 464 funds now yield 5.0% or more ($5.018 trillion, or 77.5%). Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.63%. The latest Brokerage Sweep Intelligence, with data as of May 31, shows that there were no changes over the past week, two weeks prior we saw the removal of TD Ameritrade from the listings pushed the averages higher (2 bps). Three of the 10 major brokerages tracked by our BSI still offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch and Morgan Stanley. (Note: Three weeks ago we removed rates for TD Ameritrade from BSI since it completed its merger with Charles Schwab.)

A Prospectus Supplement for the TIAA-CREF Fixed-Income Funds says, "The Board of Trustees of the TIAA-CREF Funds has approved a change in the following Funds' names, effective May 1, 2024." It tells us that TIAA-CREF Money Market Fund is now Nuveen Money Market Fund, TIAA-CREF Bond Index Fund is now Nuveen Bond Index Fund, TIAA-CREF Core Bond Fund is now Nuveen Core Bond Fund, TIAA-CREF Core Impact Bond Fund is now Nuveen Core Impact Bond Fund, TIAA-CREF Core Plus Bond Fund is now Nuveen Core Plus Bond Fund, TIAA-CREF Green Bond Fund is now Nuveen Green Bond Fund, TIAA-CREF High-Yield Fund is now Nuveen High Yield Fund, TIAA-CREF Short Duration Impact Bond Fund is now Nuveen Short Duration Impact Bond Fund, TIAA-CREF Short-Term Bond Fund is now Nuveen Short Term Bond Fund, and TIAA-CREF Short-Term Bond Index Fund is now Nuveen Short Term Bond Index Fund. The filing adds, "There will be no changes to the investment objectives, principal investment strategies, principal investment risks or portfolio management of the Funds in connection with these name changes. The Board has also approved changes to the names of certain of the Funds' share classes, effective May 6, 2024. Therefore, as of May 6, 2024, all references to the following share classes in the Summary Prospectuses and Statutory Prospectus are hereby changed as follows: Institutional Class is now Class R6, Advisor Class is now Class I and Retail Class is now Class A."

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