U.​K.-​based Treasury Today published a piece titled, "GSAM and GTreasury: lower rates and SEC reforms hold implications for US dollar MMFs." It states, "​MMF investors should prepare for the Federal Reserve to ease interest rates at the September Federal Open Market Committee (​FOMC) meeting, now that inflation has been tamed. Rate cuts were predicted much earlier in 2024, but the market had to reprice because of enduringly high first quarter inflation readings. '​Inflation was proving persistent and tricky to combat,' said Pat O'​Callaghan, Global Head-​Client Portfolio Management, Liquidity Solutions at Goldman Sachs Asset Management.... O'​Callaghan predicted a series of 25 basis point rate cuts that will see a total 75 basis point cut by the end of the year. O'​Callaghan said assets in global MMFs had reached record levels and one of the key drivers has been the expectation that the Fed would start to lower rates. Because MMF yields lag market rates, they have provided a better yield than many other securities. 'MMF yields have remained high across various fund types,' he said." The article continues, "​However, he warned these yields would start to move lower once the Fed begins easing although the impact would be cushioned by diversification. 'MMFs will continue to be attractive assets for clients with short-​term cash needs compared to other investments that are more correlated to what the Fed is doing'.... O'​Callaghan said that anticipation of lower rates is triggering a number of strategies. For example, investors are switching from reverse repo into non-​Fed counterparty reverse repo facilities -- choosing to use a different counterparty for their repo allocation and not rely so heavily on the Fed. 'The rates in non-​Fed reverse repo eclipse what the Fed offers through reverse repo,' he said. In another trend, he noticed MMF investors are moving funds out of reverse repo into the direct treasury bucket. Government treasury MMFs offer the best liquidity and enable treasury teams to invest across various terms depending on their views of Fed policy relative to market pricing. He said investors are steadily increasing allocations to longer dated trades and opting for a more granular bucket on where to deploy capital as they prepare for lower market interest rates and the next phase of the market cycle."

Barron'​s writes that, "JPMorgan Is Latest Brokerage Hit With Cash-​Sweep Lawsuit." Their article states, "JPMorgan Chase and its subsidiary J.​P. Morgan Securities are the latest targets of a proposed class-​action lawsuit involving their interest payments on clients’ uninvested cash. The complaint, brought by Illinois resident Dan Bodea, alleges that J.​P. Morgan Securities routinely swept clients' cash into accounts at the parent bank that paid '​unreasonably low' interest rates, while the company benefited from cheap access to those funds. JPMorgan declined to comment on the case." They write, "The lawsuit is the latest in a series of proposed class actions against brokerage firms involving their cash-​sweep programs. Earlier cases have taken aim at Ameriprise, LPL Financial, Morgan Stanley, UBS, and Wells Fargo. Regulators have also taken an interest in the issue, with Morgan Stanley and Wells Fargo saying they have been responding to inquiries from the Securities and Exchange Commission about their cash-​sweep programs." Barron'​s adds, "The complaint against JPMorgan alleges that the firm misled customers about the nature of its program, which it says the defendants used to '​generate substantial revenue for themselves with their customers' cash and beneficial returns on such cash, while paying their customers only a small fraction of those returns.' The plaintiff alleges that JPMorgan'​s cash program amounted to a breach of fiduciary duty, breach of contract, and was the source of unjust enrichment, among other violations. The suit is seeking damages, interest, and an injunction against JPMorgan." For more on recent `​Brokerage Sweep News, see these CraneData.​com stories: "Law Firm Says Bolster Disclosures, Rates on Sweeps" (​8/​13/​24), "Barron'​s: BofA Cites Risk from Sweeps" (​8/​8/​24), "Central Bank of Ireland on Fund Regulations; Brokerage Sweeps Lawsuits" (​8/​5/​24), "Tradeweb Completes ICD Acquisition; AdvisorHub on Wells Sweep Suit" (​8/​2/​24), "IN: Ameriprise Sued Over Sweeps" (​7/​31/​24), "Federated Hermes' Donahue, Cunningham Call Hits Sweeps, Flows, Rates" (​7/​29/​24), "Ameriprise, Raymond James Discuss Sweeps Issues on Earnings Call Q&​As" (​7/​26/​24), "Barron'​s Writes on Pressure on Sweeps" (​7/​25/​24), "WSJ, Investment News on Brokerage Deposit, Advisory Sweep Pressures" (​7/​19/​24), "Schwab, BlackRock Q2 Earnings: Cash Migration Slowing, But Continues" (​7/​17/​24).

There are just 3 weeks to go until Crane'​s European Money Fund Symposium, which will take place Sept. 19-​20 at the Hilton London Tower Bridge in London, England. The latest agenda is now available and registrations are still being taken for our European money market mutual fund event. We provide more details on the show below, and feel free to contact us for more information. Our 2023 European Symposium event in Edinburgh attracted over 150 money fund professionals, sponsors and speakers, and we expect even more at our upcoming London show. We expect our show in London to once again be the largest gathering of money market professionals outside the U.​S. "European Money Fund Symposium offers European, global and '​offshore' money market portfolio managers, investors, issuers, dealers and service providers a concentrated and affordable educational experience, and an excellent and informal networking venue," says Crane Data President Peter Crane. "​Our mission is to deliver the best possible conference content at an affordable price to money market fund professionals," he adds. Registration for European Money Fund Symposium is $​1,​000 USD. EMFS will be held at the Hilton London Tower Bridge. Hotel rooms must be booked before August 14 to receive our discounted rate of L329. Visit www.​craneeurosymposium.​com to register, and contact us to request the PDF brochure. (​Let us know too if you'​d like information on speaking or sponsorships too.) We'​re also starting to make plans for our next Crane'​s Money Fund University, which will be held in Providence, R.​I., Dec. 19-​20, 2024. Money Fund University covers the history of money funds, interest rates, regulations (​Rule 2a-​7), ratings, rankings, money market instruments such as commercial paper, CDs and Treasuries, and portfolio construction and credit analysis. We also include segments on offshore money funds and ultra-​short bond funds. Money Fund University'​s comprehensive program is good for both beginners and experienced professionals looking for a refresher. Mark your calendars for our next Bond Fund Symposium, which will be held in Newport Beach, Calif., on March 27-​28, 2025, and for our next big show, Money Fund Symposium, which is scheduled for June 23-​25, 2025 in Boston, Mass. The agenda will be released later this fall and registrations are now open. Let us know if you'​d like more details on any of our events, and we hope to see you, in London next month, in Providence in December, in Newport Beach in March 2025 or in Boston in June 2025. Thanks to all of our speakers and sponsors and for your support!

While yields on money market mutual funds won'​t drop in earnest until after the Federal Reserve cuts short-​term interest rates, yields continue to creep lower ahead of any move. Money fund yields fell to 5.​10% (​down 1 bp) on average in the week ended Aug. 23 (​as measured by our Crane 100 Money Fund Index, an average of 7-​day yields for the 100 largest taxable money funds) after remaining unchanged the week prior. Yields were 5.​13% on 7/​31 and 6/​28, 5.​14% on 5/​31, 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 $​17.​7 billion last week to $​6.​577 trillion according to Crane Data'​s Money Fund Intelligence Daily. Weighted average maturities were unchanged at 33 days. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (​currently 699), shows a 7-​day yield of 5.​00%, down 1 bp in the week through Friday. Brokerage sweep rates also remained unchanged, contrary to the discussions on a number of brokerage earnings calls in recent weeks. Prime Inst money fund yields were unchanged at 5.​15% in the latest week. Government Inst MFs were down 1 bp at 5.​09%. Treasury Inst MFs were down 1 bp at 5.​04%. Treasury Retail MFs currently yield 4.​82%, Government Retail MFs yield 4.​81%, and Prime Retail MFs yield 5.​01%, Tax-​exempt MF 7-​day yields were down 12 bps to 3.​08%. According to Monday'​s Money Fund Intelligence Daily, with data as of Friday (​8/​23), 37 money funds (​out of 819 total) yield under 3.​0% with $​16.​5 billion in assets, or 0.​3%; 87 funds yield between 3.​00% and 3.​99% ($​119.​3 billion, or 1.​8%), 270 funds yield between 4.​0% and 4.​99% ($​1.​238 trillion, or 18.​8%) and 425 funds now yield 5.​0% or more ($​5.​203 trillion, or 79.​1%). Our Brokerage Sweep Intelligence Index, an average of FDIC-​insured cash options from major brokerages, was unchanged (​again) at 0.​62%. The latest Brokerage Sweep Intelligence, with data as of Aug. 23, shows that there was no changes over the past week. (We haven'​t seen many of the changes mentioned on earnings calls, which apparently only apply to a narrow slice of "​advisory" accounts. Only a couple of brokerages report these rates, which aren'​t included on our BSI report.) Thirteen weeks ago, we removed the rates for TD Ameritrade from the listings, which completed its merger with Charles Schwab and which 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.

Reuters published, "Investors rush to money market funds before Fed rate cut, BofA says," which tells us, "Investors poured $​37 billion into cash-​like money market funds (​MMFs) in the week to Wednesday, Bank of America said on Friday, as they braced for the U.​S. Federal Reserve to cut interest rates in September. It put MMFs on track for their biggest three-​week cumulative inflow since January at $​145 billion, BofA said, citing figures from financial data provider EPFR." Reuters states, "​Many fund managers hope rate cuts will lower the returns on MMFs and cause a rush of cash into stocks and bonds. Yet big investors typically flock to money market funds before the Fed cuts rates, as the range of short-​term fixed income securities in the funds means they tend to offer higher returns for longer than short-​term Treasury bills." They quote BofA strategist Jared Woodard, "Rate cuts not a likely spark for equity buying from the $​6.​2 trillion money market fund (​sector)."

The FOMC'​s "Minutes of the Federal Open Market Committee, July 30–​31, 2024, which were released on Wednesday, state, "Nominal Treasury yields declined over the period, with shorter-​term yields having decreased by more than longer-​term yields, leading to a steepening of the yield curve.... The effective federal funds rate remained unchanged over the intermeeting period, but the manager noted that rates on repurchase agreements (​repo) had edged higher, reflecting increased demand for financing Treasury securities as well as the expected effects of gradual balance sheet normalization. Use of the overnight reverse repo (​ON RRP) facility declined slightly over the intermeeting period. The staff projected that ON RRP usage would decline more noticeably over the remainder of the year, particularly as issuance of Treasury bills increases. However, the manager noted that it was possible that idiosyncratic factors specific to some ON RRP participants might support ON RRP balances in the months ahead. Looking at a range of money market indicators, the manager concluded that reserves remained abundant but indicated that the staff would continue to closely monitor developments in money markets. Finally, the manager described a set of technical adjustments to the production of the Secured Overnight Financing Rate that the Federal Reserve Bank of New York had proposed in a recent public consultation." The Minutes continue, "Overnight secured rates edged up over the intermeeting period, but conditions in U.​S. short-​term funding markets remained stable, with typical dynamics observed surrounding quarter-​end. Average usage of the ON RRP facility declined slightly. Banks' total deposit levels increased modestly, as large time deposits displayed moderate inflows." They say, "​In their discussion of financial stability, participants who commented noted vulnerabilities to the financial system that they assessed warranted monitoring. Some participants observed that the banking system was sound but noted risks associated with unrealized losses on securities, reliance on uninsured deposits, and interconnections with nonbank financial intermediaries." The Minutes add, "In support of the Committee'​s goals to achieve maximum employment and inflation at the rate of 2 percent over the longer run, members agreed to maintain the target range for the federal funds rate at 5 1/​4 to 5 1/​2 percent. Members concurred that, in considering any adjustments to the target range for the federal funds rate, they would carefully assess incoming data, the evolving outlook, and the balance of risks. Members agreed that they did not expect that it would be appropriate to reduce the target range until they had gained greater confidence that inflation is moving sustainably toward 2 percent. In addition, members agreed to continue to reduce the Federal Reserve'​s holdings of Treasury securities and agency debt and agency mortgage backed securities. All members affirmed their strong commitment to returning inflation to the Committee'​s 2 percent objective."

A press release titled, "ICI and ISS MI BrightScope Report 401(​k) Plan Participants Continue to Benefit from Employer Contributions and Falling Fees" tells us, "The undeniable strength of the 401(​k) system is seen in the report, The BrightScope/​ICI Defined Contribution Plan Profile: A Close Look at 401(​k) Plans, 2021, released ... by ISS Market Intelligence (​MI) and the Investment Company Institute (​ICI).... Plan sponsors' design choices also include the number and types of investment options in the 401(​k) plan. In 2021, the average large 401(​k) plan offered 28 investment options, typically including domestic equity funds, international equity funds, domestic bond funds, and target date funds." The study says, "In 2021, the average large 401(​k) plan offered 28 investment options, of which about 13 were equity funds, three were bond funds, and nine were target date funds. Nearly all plans offered at least one domestic equity fund, international equity fund, and domestic bond fund." It continues, "​CITs held 41 percent of large private-​sector 401(​k) plan assets in the sample in 2021. Mutual funds held 38 percent of assets, guaranteed investment contracts (​GICs) held 5 percent, separate accounts held 3 percent, and the remaining 12 percent were invested in individual stocks (​including company stock), individual bonds, brokerage, and other investments. However, mutual funds accounted for at least half of the assets in all but the very largest plans, where a larger share of assets was held in CITs." ICI writes, "In 2021, 43 percent of large 401(​k) plan assets were held in equity funds, 31 percent were held in balanced funds (​with most of that being held in target date funds), and 6 percent were held in bond funds. GICs and money funds accounted for 7 percent of assets." They say, "​Domestic equity funds, international equity funds, and domestic bond funds -- all of which include both index and actively managed funds -- were the most likely investment options to be offered in large 401(​k) plans in 2021.... Forty-​five percent of large 401(​k) plans offered money funds, and 71 percent offered guaranteed investment contracts (​GICs)." It continues, "​For most investment types, availability by plan size did not vary much. However, larger plans were more likely to offer other investments (​which include company stock), GICs, and money funds.... Similarly, 32.​7 percent of plans with less than $​1 million in plan assets offered money funds in 2021, compared with 73.​8 percent of plans with more than $​1 billion." The survey states, "In 2021, large 401(​k) plans included three bond funds (​mostly domestic, including both index and actively managed funds) in their investment lineups, on average.... Plans also offered money funds, GICs, and other options. These investments were not offered as widely ... and were often included as the single choice in that investment type." Discussing expenses, the survey adds, "The average expense ratio for bond mutual funds in the BrightScope database was 0.​31 percent, compared with 0.​25 percent in the ICI database, and the expense ratio for money market mutual funds was 0.​11 percent in the BrightScope database compared with 0.​12 percent in the ICI database.... Money market mutual funds had the lowest expense ratio of any of the asset classes with an asset-​weighted average expense ratio of 0.​11 percent of assets in 2021 for money market mutual funds in large 401(​k) plans."

While Crane Data is gearing up for its next live event, European Money Fund Symposium, which will take place Sept. 19-​20 in London, England, we are also making plans for our next Money Fund University educational conference. Our 14th annual MFU will once again focus on a higher level "Master'​s in Money Markets" format instead of its earlier "​basic training" focus, and will contain expanded content on Rule 2a-​7 and the SEC'​s new Money Market Fund Reforms. It will take place at The Renaissance Hotel in Providence, R.​I., Dec. 19-​20, 2024. Crane'​s Money Fund University is designed for those relatively new to the money market fund industry or those in need of a concentrated refresher on a broad core curriculum. The event also focuses on hot topics like money market fund regulations, money fund alternatives, offshore markets, and other recent industry trends. Our educational conference features a faculty of the money fund industry'​s top lawyers, strategists, and portfolio managers, and the Providence show will include an extended free training session (​and lunch) for Crane Data clients, as well as a Holiday party where all are welcome. Money Fund University offers a 2-​day crash course on money market mutual funds, educating attendees on the history of money funds, the Fed, interest rates, ratings, rankings, and money market instruments such as commercial paper, Treasury bills, CDs and repo. We also cover portfolio construction and credit analysis. Registrations ($​750) are now being taken, and the latest agenda is available here. (E-​mail us to request the latest brochure.) New portfolio managers, analysts, investors, issuers, service providers, and anyone interested in expanding their knowledge of "​cash" investing should benefit from our comprehensive program. Even experienced professionals may enjoy a refresher course and the opportunity to interact with peers in an informal setting. Also, please join us next month for the 10th Annual Crane'​s European Money Fund Symposium. The latest agenda is available and registrations are still being taken for this year'​s European event, which will take place Sept. 19-​20 at the Hilton London Tower Bridge in London, England. Registration for European Money Fund Symposium is $​1,​000 USD. Mark your calendars too for our next Bond Fund Symposium, which will be held in Newport Beach, CA, on March 27-​28, 2025 and for our next Money Fund Symposium, which will be held in Boston, Mass., June 23-​25, 2025. Let us know if you'​d like more details on any of our events, and we hope to see you in London next month, in Providence in December, in Newport Beach in March 2025, or in Boston in June 2025!

Money fund yields remained at 5.​11% on average in the week ended Aug. 16 (​as measured by our Crane 100 Money Fund Index, an average of 7-​day yields for the 100 largest taxable money funds) after falling 1 bp the week prior. Yields were 5.​13% on 6/​28, 5.​14% on 5/​31, 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 $​3.​4 billion last week to $​6.​559 trillion according to Crane Data'​s Money Fund Intelligence Daily. Weighted average maturities were unchanged at 33 days. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (​currently 706), shows a 7-​day yield of 5.​01%, unchanged in the week through Friday. Brokerage sweep rates also remained unchanged, contrary to the discussions on a number of brokerage earnings calls in recent weeks. Prime Inst money fund yields were unchanged at 5.​15% in the latest week. Government Inst MFs were unchanged at 5.​10%. Treasury Inst MFs were unchanged at 5.​05%. Treasury Retail MFs currently yield 4.​83%, Government Retail MFs yield 4.​82%, and Prime Retail MFs yield 5.​01%, Tax-​exempt MF 7-​day yields were up 30 bps to 3.​20%. According to Monday'​s Money Fund Intelligence Daily, with data as of Friday (​8/​16), 22 money funds (​out of 823 total) yield under 3.​0% with $​1.​4 billion in assets, or 0.​0%; 102 funds yield between 3.​00% and 3.​99% ($​133.​2 billion, or 2.​0%), 266 funds yield between 4.​0% and 4.​99% ($​1.​209 trillion, or 18.​4%) and 433 funds now yield 5.​0% or more ($​5.​215 trillion, or 79.​5%). Our Brokerage Sweep Intelligence Index, an average of FDIC-​insured cash options from major brokerages, was unchanged (​again) at 0.​62%. The latest Brokerage Sweep Intelligence, with data as of Aug. 16, shows that there was no changes over the past week. (We haven'​t seen many of the changes mentioned on earnings calls, which apparently only apply to a narrow slice of "​advisory" accounts. Only a couple of brokerages report these rates, which aren'​t included on our BSI report.) Twelve weeks ago, we removed the rates for TD Ameritrade from the listings, which completed its merger with Charles Schwab and which 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.

The New York Times writes that, "The End of Fabulous Money Market Rates Is Near." They tell us, "While stocks and bonds have zigged and zagged, often painfully, over the last few years, one area of the markets has been blissfully steady: money market funds. For more than a year, with minimal risk, investors have been able to get more than 5 percent annually -- and substantially beat inflation -- by just parking their cash in fairly reliable places. This wonderful refuge from the market storms isn'​t disappearing. But with short-​term interest rates likely to fall soon, the shelter will become less comfortable, and it'​s time to get ready. It may be wise to start looking beyond money market funds, locking in the relatively high rates now for at least some of your money, and re-​evaluating your needs." The piece asks, "Can you afford to move some of the cash that you don'​t need immediately into bonds, which fluctuate in value yet tend to produce better long-​term returns than money market funds? And do you have excess cash that may be better invested in stocks, which are likely to produce superior long-​term returns but are unreliable over shorter periods, especially in a volatile election year? These aren’​t simple questions." The Times adds, "Largely because of declining inflation, the Federal Reserve is widely expected to start reducing short-​term interest rates at its next meeting in September.... [​But] I have no intention of abandoning money market funds entirely. In fact, if you haven'​t been using money market funds at all, you may want to start. Check whether you have money in a brokerage '​sweep account' or sitting in a bank account. If you aren'​t getting anything close to 5.​1 percent (​or higher) for your cash, you may want to switch to a money market fund and then consider what to do down the road.... For the money I need in the next year or two, money market funds will be appropriate. For nearly everything else, long-​term asset allocation using low-​cost index funds is likely to pay off."

The Investment Company Institute published its latest weekly "Money Market Fund Assets" report Thursday, which shows money market mutual fund assets rising to a record $​6.​216 trillion in the latest week. Assets have risen in 13 of the last 17 weeks, increasing by $​238.​1 billion (​or 4.​0%) since April 24. MMF assets are up by $​329 billion, or 7.​0%, year-​to-​date in 2024 (​through 8/​14/​24), with Institutional MMFs up $​110 billion, or 3.​6% and Retail MMFs up $​219 billion, or 13.​1%. Over the past 52 weeks, money funds have risen by $​646 billion, or 11.​6%, with Retail MMFs up by $​434 billion (​20.​9%) and Inst MMFs rising by $​212 billion (​6.​1%). The weekly release says, "Total money market fund assets increased by $​28.​38 billion to $​6.​22 trillion for the week ended Wednesday, August 14, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $​30.​25 billion and prime funds decreased by $​1.​04 billion. Tax-​exempt money market funds decreased by $​834 million." ICI'​s stats show Institutional MMFs rising $​26.​0 billion and Retail MMFs rising $​2.​4 billion in the latest week. Total Government MMF assets, including Treasury funds, were $​5.​037 trillion (​81.​0% of all money funds), while Total Prime MMFs were $​1.​051 trillion (​16.​9%). Tax Exempt MMFs totaled $​128.​1 billion (​2.​1%). ICI explains, "Assets of retail money market funds increased by $​2.​40 billion to $​2.​51 trillion. Among retail funds, government money market fund assets decreased by $​1.​17 billion to $​1.​60 trillion, prime money market fund assets increased by $​4.​02 billion to $​796.​37 billion, and tax-​exempt fund assets decreased by $​458 million to $​116.​75 billion." Retail assets account for over a third of total assets, or 40.​4%, and Government Retail assets make up 63.​6% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $​25.​98 billion to $​3.​71 trillion. Among institutional funds, government money market fund assets increased by $​31.​41 billion to $​3.​44 trillion, prime money market fund assets decreased by $​5.​06 billion to $​254.​14 billion, and tax-​exempt fund assets decreased by $​376 million to $​11.​38 billion." Institutional assets accounted for 59.​6% of all MMF assets, with Government Institutional assets making up 92.​8% of all institutional MMF totals. According to Crane Data'​s separate Money Fund Intelligence Daily series, money fund assets have risen by $​62.​8 billion in August (​through 8/​14) to $​6.​568 trillion. They hit a record $​6.​583 trillion on 8/​13 but have since fallen. Assets rose by $​16.​6 billion in July, $​15.​7 billion in June and $​91.​4 billion in May, but they fell $​15.​8 billion in April and $​68.​8 billion in March. 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 and $​98.​3 billion in August. 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.

ICI released its latest monthly "Money Market Fund Holdings" summary, which reviews the aggregate daily and weekly liquid assets, regional exposure, and maturities (​WAM and WAL) for Prime and Government money market funds. This release says, "The Investment Company Institute (​ICI) reports that, as of the final Friday in July, prime money market funds held 45.​3 percent of their portfolios in daily liquid assets and 62.​9 percent in weekly liquid assets, while government money market funds held 77.​5 percent of their portfolios in daily liquid assets and 88.​4 percent in weekly liquid assets." Prime DLA was up from 44.​6% in June, and Prime WLA was up from 61.​6%. Govt MMFs' DLA dipped to 77.​5% and Govt WLA increased from 87.​9% the previous month. ICI explains, "At the end of July, prime funds had a weighted average maturity (​WAM) of 28 days and a weighted average life (​WAL) of 46 days. Average WAMs and WALs are asset-​weighted. Government money market funds had a WAM of 35 days and a WAL of 83 days." Prime WAMs were 2 days shorter and WALs were 2 days shorter from the previous month. Govt WAMs and WALs were 1 day shorter from June. Regarding Holdings by Region of Issuer, the release tells us, "Prime money market funds' holdings attributable to the Americas declined from $​559.​01 billion in June to $​510.​21 billion in July. Government money market funds' holdings attributable to the Americas declined from $​4,​476.​77 billion in June to $​4,​476.​07 billion in July." The Prime Money Market Funds by Region of Issuer table shows Americas-​related holdings at $​510.​2 billion, or 48.​6%; Asia and Pacific at $​194.​7 billion, or 18.​5%; Europe at $​324.​6 billion, or 30.​9%; and, Other (​including Supranational) at $​20.​4 billion, or 1.​9%. The Government Money Market Funds by Region of Issuer table shows Americas at $​4.​476 trillion, or 88.​8%; Asia and Pacific at $​145.​3 billion, or 2.​9%; Europe at $​405.​5 billion, 8.​0%, and Other (​Including Supranational) at $​12.​8 billion, or 0.​3%.

A Prospectus Supplement filing for the Dreyfus New York Municipal Money Market Fund tells us, "The Board of Trustees of General New York Municipal Money Market Fund has approved the liquidation of Dreyfus New York Municipal Money Market Fund, a series of the Trust, effective on or about October 28, 2024. Before the Liquidation Date, and at the discretion of Fund management, the Fund'​s portfolio securities will be sold and/​or allowed to mature in their normal course and the Fund may cease to pursue its investment objective and policies. The liquidation of the Fund may result in one or more taxable events for shareholders subject to federal income tax." It continues, "Accordingly, effective on or about September 18, 2024, the Fund will be closed to any investments for new accounts, except that new accounts may be established for "​sweep accounts" and by participants in group retirement plans (​and their successor plans), if the Fund is established as an investment option under the plans before the Closing Date. The Fund will continue to accept subsequent investments until the Liquidation Date, except that subsequent investments made by check or pursuant to TeleTransfer or Automatic Asset Builder no longer will be accepted after October 18, 2024. However, subsequent investments by retirement accounts sponsored by BNY Mellon Investment Adviser, Inc. or its affiliates pursuant to TeleTransfer or Automatic Asset Builder (​but not by check) will be accepted after October 18, 2024. Please note that checks presented for payment to the Fund'​s transfer agent pursuant to the Fund'​s Checkwriting Privilege on or after the Liquidation Date will not be honored." For more, see our Jan. 26, 2024 News, "More Municipal MMF Liquidations."

The Wall Street Journal writes that, "Finance Chiefs Lean on Commercial Paper to Trim Costs, Prepare for Rate Cuts." The brief states, "Finance chiefs are issuing debt in the commercial paper market to save on interest costs and prepare their balance sheets for a likely rate cut from the Federal Reserve. The short-​term debt appeals to big, highly rated companies because it can quickly capture the benefit of falling interest rates. As commercial paper has a short maturity, typically ranging from days to months, companies reissue this type of debt frequently and, when rates fall, can do so at a lower cost. Commercial paper also can provide a less expensive alternative to bank loans. Companies issue commercial paper to fund working capital, weather seasonality in their cash flow or provide a bridge between long-​term capital raises." The article tells us, "Issuance in the commercial paper market has broadly picked up since plunging during the pandemic, amid the initial economic shock caused by Covid and a surge in corporate bond issuance. As of Aug. 7, the amount of domestic commercial paper outstanding from nonfinancial companies increased 27% from a year earlier, to $​238.​7 billion, according to the Federal Reserve. Commercial paper programs are typically cheaper than credit facilities from a bank.... Prologis during the second quarter began to reap savings from a $​1 billion commercial paper program that the warehouse giant launched in March.... With its new commercial paper program, Prologis is saving about a 0.​6 percentage point compared with using its credit lines, Arndt said. The company should save millions of dollars a year by opportunistically shifting balances to its commercial paper program, he said.... The price that companies pay to issue commercial paper usually varies alongside the secured overnight financing rate, or SOFR." The Journal adds, "Colgate-​Palmolive during the first quarter used commercial paper to fund the repayment of a $​500 million bond. The consumer staples company has about $​8.​7 billion in total debt outstanding, including $​1.​6 billion in commercial paper, according to S&​P Global Market Intelligence. '​At some point, we expect interest rates will come down…​and that will help us keep our fixed-​floating back in balance,' CFO Stanley Sutula said on an April 26 earnings call, discussing why Colgate-​Palmolive chose to pay off the bond with commercial paper. A risk of issuing commercial paper is the possibility of a market shock that could reduce investor demand and leave companies with unexpected liabilities, credit analysts said. To guard against this risk, companies keep a portion of their credit lines undrawn as a backup. In March 2020, at the beginning of the pandemic, the Fed intervened in the market to ensure companies could continue to borrow."

A press release titled, "Franklin Templeton Money Market Fund Launches on Arbitrum Blockchain," which states, "The Arbitrum Foundation and global asset manager Franklin Templeton ... announced the Franklin OnChain U.​S. Government Money Fund (​FOBXX) is available on Arbitrum, the leading Ethereum Layer 2 blockchain. Investors can gain exposure to FOBXX in digital wallets through the Benji Investments platform, Franklin Templeton'​s proprietary blockchain-​integrated recordkeeping system, and may use the Arbitrum network upon request and subject to eligibility. The collaboration will accelerate the integration of decentralized finance within traditional financial services. By onboarding the Arbitrum network to the Benji Investments platform, Franklin Templeton will further extend the compatibility of FOBXX within the digital assets ecosystem and reach a previously untapped audience for the asset manager." Steven Goldfeder, CEO and Co-​Founder of Offchain Labs -- core contributors to Arbitrum -- comments, "Franklin Templeton'​s commitment to innovation aligns with our mission to provide scalable and efficient solutions for the financial sector. We are excited to see Franklin Templeton join the Arbitrum ecosystem and look forward to the transformative impact their participation will bring to our community." The release explains, "`​Since 2018, Franklin Templeton Digital Assets has been building blockchain-​based technology solutions, running node validators, and developing a wide range of investment strategies. The firm'​s dedicated digital assets research team leverages fundamental '​tokenomic' analysis, insights from an embedded data science team and deep industry connections to help inform product development and investment decisions." Roger Bayston, Franklin Templeton Head of Digital Assets, adds, "Expanding into the Arbitrum ecosystem is an important step on our journey to empower our asset management capabilities with blockchain technology. We are enthusiastic about the opportunities this partnership will unlock for our firm and our clients." Finally, they say, "FOBXX was introduced in 2021 and is the first and only U.​S.-​registered fund to use a public blockchain as the system of record to process transactions and record share ownership. Individual investors can download the Benji Investments mobile app on Apple and Android devices, while institutional investors can access the platform through the Benji Institutional web portal." For more, see these Crane Data News articles: "Fidelity Intl Tokenizes MF, Paxos" (​6/​14/​24), "J.​​P. Morgan on Weekly Holdings, Treasury Repo Clearing; Fitch; OnChain" (​5/​2/​24), "European Money Fund Symposium London, Sept. 19-​20; Tokenized MMFs" (​4/​25/​24), "CoinDesk on Tether Stablecoin; Paxos" (​2/​5/​24), "Forbes: SEC Targets PayPal Stablecoin" (​11/​13/​23), "J.​P. Morgan on Stablecoin Shrinkage, Risks; Bloomberg, WSJ and NY Fed" (​9/​28/​23), "CNBC on PayPal, Paxos' Stablecoin" (​8/​10/​23) and "NY Fed on '​Runs on Stablecoins'" (​7/​19/​23).

The Investment Company Institute published its latest weekly "Money Market Fund Assets" report Thursday, which shows money market mutual fund assets rising to a record $​6.​187 trillion in the latest week. Assets have risen in 12 of the last 16 weeks, increasing by $​210.​0 billion (​or 3.​5%) since April 24. MMF assets are up by $​301 billion, or 6.​4%, year-​to-​date in 2024 (​through 8/​7/​24), with Institutional MMFs up $​84 billion, or 2.​7% and Retail MMFs up $​217 billion, or 12.​9%. Over the past 52 weeks, money funds have risen by $​657 billion, or 11.​9%, with Retail MMFs up by $​447 billion (​21.​7%) and Inst MMFs rising by $​210 billion (​6.​1%). The weekly release says, "Total money market fund assets increased by $​52.​69 billion to $​6.​19 trillion for the week ended Wednesday, August 7, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $​51.​67 billion and prime funds increased by $​551 million. Tax-​exempt money market funds increased by $​468 million." ICI'​s stats show Institutional MMFs rising $​37.​3 billion and Retail MMFs rising $​15.​4 billion in the latest week. Total Government MMF assets, including Treasury funds, were $​5.​007 trillion (​80.​9% of all money funds), while Total Prime MMFs were $​1.​052 trillion (​17.​0%). Tax Exempt MMFs totaled $​129.​0 billion (​2.​1%). ICI explains, "Assets of retail money market funds increased by $​15.​38 billion to $​2.​51 trillion. Among retail funds, government money market fund assets increased by $​12.​66 billion to $​1.​60 trillion, prime money market fund assets increased by $​2.​16 billion to $​792.​35 billion, and tax-​exempt fund assets increased by $​561 million to $​117.​21 billion." Retail assets account for over a third of total assets, or 40.​5%, and Government Retail assets make up 63.​7% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $​37.​31 billion to $​3.​68 trillion. Among institutional funds, government money market fund assets increased by $​39.​01 billion to $​3.​41 trillion, prime money market fund assets decreased by $​1.​61 billion to $​259.​19 billion, and tax-​exempt fund assets decreased by $​93 million to $​11.​76 billion." Institutional assets accounted for 59.​5% of all MMF assets, with Government Institutional assets making up 92.​6% of all institutional MMF totals. According to Crane Data'​s separate Money Fund Intelligence Daily series, money fund assets have risen by $​34.​3 billion in August (​through 8/​7) to $​6.​540 trillion. They hit a record $​6.​559 trillion on 7/​11 but have since eased off a bit. Assets rose by $​16.​6 billion in July, $​15.​7 billion in June and $​91.​4 billion in May, but they fell $​15.​8 billion in April and $​68.​8 billion in March. 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 and $​98.​3 billion in August. 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.

Barron'​s writes, "Bank of America Adds Cash Sweep Accounts to Risk Factors in SEC Filing." The article tells us, "This summer, wealth management companies have been facing regulatory queries and hit with lawsuits from customers over paltry rates paid in cash sweep accounts. Now, Bank of America is warning shareholders that it too could face potential legal or regulatory risks related to 'the rates paid on uninvested cash in investment advisory accounts that is swept into interest-​paying bank deposits,' according to the company'​s most recent 10-​Q filing with the Securities and Exchange Commission.... A company representative declined to comment. But the addition to a list of potential risks is notable given the raft of lawsuits filed against competitors such as Morgan Stanley, LPL Financial, and Ameriprise Financial. On Monday, Morgan Stanley disclosed in a regulatory filing that the SEC has been seeking information about its sweep account policies." The piece adds, "Mounting legal and regulatory woes have been a point of concern for shareholders and analysts because that could result in pressure on firms to pay more in interest on customer cash. Such a move would eat into net interest income, a key profit center for some wealth management companies. Wells Fargo and Morgan Stanley have both announced in recent weeks that they increased interest rates on some sweep cash balances." Morgan Stanley'​s 10-​Q filing contains the language (​on page 68), "The Firm has been named in two putative class actions regarding cash sweep programs for retail clients. On February 1, 2024, E*​TRADE Securities LLC (​E*​TRADE) and Morgan Stanley Smith Barney LLC (​MSSB) were named in Burmin, et al. v. E*​TRADE Securities LLC, et al., filed in the United States District Court for the District of New Jersey, alleging that, from February 2018 to present, E*​TRADE (​and post-​merger MSSB) breached customer agreements by failing to pay a reasonable rate of interest to Individual Retirement Account holders on cash balances swept to affiliate bank deposit programs. A motion to dismiss is pending. On June 14, 2024, MSSB and other Firm entities were named in Estate of Sherlip, et al. v. Morgan Stanley, et al., filed in the United States District Court for the SDNY, alleging the defendants failed to pay a reasonable rate of interest to brokerage, retirement, and advisory account holders on cash balances swept to affiliate bank deposit programs. The class action complaints seek, among other relief, certification of the class of plaintiffs and unspecified damages."

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 Aug. 2) includes Holdings information from 68 money funds (​down 11 from two weeks ago), or $​3.​162 trillion (​down from $​3.​412 trillion) of the $​6.​531 trillion in total money fund assets (​or 48.​4%) 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 July 11 News, "July Money Fund Portfolio Holdings: Repo Jumps; TDs, Treasuries Down.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $​1.​426 trillion (​down from $​1.​487 trillion two weeks ago), or 45.​1%; Repurchase Agreements (​Repo) totaling $​1.​194 trillion (​down from $​1.​280 trillion two weeks ago), or 37.​8%, and Government Agency securities totaling $​261.​5 billion (​down from $​272.​8 billion), or 8.​3%. Commercial Paper (​CP) totaled $​95.​0 billion (​down from two weeks ago at $​113.​7 billion), or 3.​0%. Certificates of Deposit (​CDs) totaled $​67.​2 billion (​down from $​87.​7 billion two weeks ago), or 2.​1%. The Other category accounted for $​80.​8 billion or 2.​6%, while VRDNs accounted for $​37.​7 billion, or 1.​2% and Munis accounted for $​10.​9 billion, or 0.​0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $​1.​426 trillion (​45.​1% of total holdings), Fixed Income Clearing Corp with $​324.​0B (​10.​2%), the Federal Home Loan Bank with $​193.​4 billion (​6.​1%), Citi with $​86.​9B (​2.​7%), BNP Paribas with $​77.​6B (​2.​5%), JP Morgan with $​73.​9B (​2.​3%), the Federal Reserve Bank of New York with $​72.​0B (​2.​3%), Federal Farm Credit Bank with $​62.​1B (​2.​0%), RBC with $​56.​7B (​1.​8%) and Goldman Sachs with $​49.​9B (​1.​6%). The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($​259.​1B), Goldman Sachs FS Govt ($​232.​1B), Fidelity Inv MM: Govt Port ($​207.​7B), JPMorgan 100% US Treas MMkt ($​202.​3B), BlackRock Lq FedFund ($​144.​1B), Morgan Stanley Inst Liq Govt ($​140.​4B), Fidelity Inv MM: MM Port ($​135.​4B), State Street Inst US Govt ($​131.​5B), BlackRock Lq Treas Tr ($​126.​7B) and Dreyfus Govt Cash Mgmt ($​118.​5B). (​Let us know if you'​d like to see our latest domestic U.​S. and/​or "​offshore" Weekly Portfolio Holdings collection and summary.)

A press release titled, "Schwab to Launch the Schwab Ultra-​Short Income ETF" tells us, "Schwab Asset Management, the asset management arm of The Charles Schwab Corporation, ... announced the launch of the Schwab Ultra-​Short Income ETF (​SCUS), its first actively managed fixed income ETF. The first day of trading is expected to be on or about August 13. With an expense ratio of 0.​14%, the Schwab Ultra-​Short Income ETF is priced below the industry average of 0.​25%. The ETF will provide access to the U.​S. dollar denominated investment grade, short- term bond market and is designed to serve as part of a diversified portfolio." David Lafferty, Director of Product Strategy & Development at Schwab Asset Management, comments, "The Schwab Ultra-​Short Income ETF is a notable addition to the Schwab family of ETFs as investors continue to seek out cost-​effective, income-​producing strategies to help diversify their portfolios. With SCUS, the first actively managed offering in our fixed income ETF lineup, we believe investors will benefit from our extensive credit research and portfolio management teams, along with the inherent features of an ETF." The release continues, "The goal of the Schwab Ultra-​Short Income ETF is to seek current income consistent with capital preservation while maintaining liquidity. The ETF invests in investment grade, short-​term, U.​S. dollar denominated debt securities issued by U.​S. and foreign issuers and will maintain a portfolio duration of one year or less." The website RIA Biz wrote about the announcement in its piece, "With key tweaks, Charles Schwab is introducing its first ultra-​short bond product in 13 years; last time it paid dearly to settle an SEC complaint over similar product, YieldPlus." They say, "Charles Schwab Corp. is back in the ultrashort bond game 13 years after a scuffle with the SEC that no doubt left a bitter taste about the whole category – and how it'​s policed.... Schwab'​s last foray into a similar product was called 'YieldPlus,' which ended when Charles Schwab Investment Management and Charles Schwab & Co, agreed to pay more than $​118 million to settle a Securities and Exchange Commission (​SEC) investigation." They add, "When the 2008 financial crisis hit, Schwab'​s YieldPlus recorded a 35% dip after hitting peak assets of $​13.​5 billion. 'Back then it was a '​yield plus' bond mutual fund marketed as short-​term cash-​like, which went upside down as the fund manager chased yield, Lehman Bros-​style, by buying all of those toxic mortgage-​backed [​securities] that were decimated during the financial crisis,' says Timothy Welsh, president of Nexus Strategy."

The Public Funds Investment Institute (​PFII) published a brief titled, "Is Texas a Model of a Public Funds Investor-​Friendly Market." It explains, "Texas could be the model for an investor-​friendly public funds investment market, with a robust state-​sponsored local government investment pool and a number of sizable alternatives that provide public funds investors competitive choices, low fees, risk guardrails and significant disclosure requirements.... Texas has seven local government investment pools that offer a total of 14 portfolios, including government, prime and fixed rate options. LGIP assets total about $​115 billion. The state-​sponsored Texpool program sets a high standard, with state oversight, an outside manager who is a major sponsor of money market funds, very low expenses and a high level of disclosure/​transparency. It has nearly $​50 billion of assets in a government and a prime portfolio. Two other programs have assets of more than $​20 billion each, and performance histories that go back to 1987 and 1996. Each is sponsored by one or more statewide associations who receive sponsorship fees." The update continues, "While this might seem like a well-​served market, Meeder Public Funds, which manages LGIPs in two states with $​1.​85 billion of assets, has jumped in with a new offering, Texas-​Connect.... Texas is the second most populous state, and with 5,​500 local governments also ranks second in the number of public units. This makes for fertile ground for LGIPs, whose purpose is to pool funds from multiple governments for investment purposes. Texpool, the state-​sponsored LGIP, sets a strong standard. It was organized in 1989 and it was managed by the Texas State Treasury until there was a run on the fund in 1994 precipitated by a sharp rise in short term interest rates and a maturity structure that did not permit it to keep up with short term yields. (​Another victim was the Orange County, California investment pool that led to the county declaring bankruptcy.)" The update adds, "[​C]​ompetition is strong, with a number of competing pools. Three alternatives, Lonestar, sponsored by the Texas Association of School Boards, Texas CLASS, managed by Public Trust Advisors, and TexSTAR, managed by JP Morgan and marketed by Hilltop Securities have total assets of about $​60 billion.... Yet a well-​developed market does not seem to have deterred a new entrant. Texas-​Connect received a rating from S&​P Global in May and is likely to commence operating soon.... Texpool is controlled by the Texas Comptroller of Public Accounts. Texas-​Connect has both an advisory board and a board of trustees. The board of trustees is responsible for managing and administering the trust. It consists of an officer of Meeder, a retired treasurer of the Columbus Ohio City Schools and the executive director of an Illinois LGIP."

The Federal Deposit Insurance Corporation (​FDIC) recently published a "Request for Information on Deposits" memo, which comments, "The bank failures that occurred in March 2023 and the subsequent events renewed focus on deposit insurance coverage, bank funding concentrations, and certain banks' reliance on uninsured deposits. While banks are required to provide certain data on deposit liabilities on the Consolidated Reports of Condition and Income (​Call Report), they do not report comprehensive data on the composition of insured and uninsured deposits. With the attached request for information (​the request, or RFI), staff seek to further evaluate whether and to what extent certain types of deposits may behave differently from each other, particularly during periods of economic or financial stress." The brief explains, "The request for information includes questions on deposit data that is not currently reported in the Federal Financial Institutions Examination Council'​s (​FFIEC) Call Report or other regulatory reports, including for uninsured deposits. The request seeks information on the characteristics that affect the stability and franchise value of different types of deposits and whether more detailed or more frequent reporting on these characteristics or types of deposits could enhance offsite risk and liquidity monitoring; inform analysis of the benefits and costs associated with additional deposit insurance coverage for certain types of deposits; improve risk sensitivity of deposit insurance pricing; and provide analysts and the general public with accurate and transparent data." It adds, "Staff recommend that the FDIC'​s Board of Directors (​Board) approve the attached request for information (​the request, or RFI) and authorize its publication in the Federal Register with a comment period ending 60-​days after publication." See also the statement, "FDIC Board Approves Proposed Rule to Revise Brokered Deposit Regulations."

A release, "Federal Reserve issues FOMC statement," tells us, "Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have moderated, and the unemployment rate has moved up but remains low. Inflation has eased over the past year but remains somewhat elevated. In recent months, there has been some further progress toward the Committee'​s 2 percent inflation objective. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. The Committee judges that the risks to achieving its employment and inflation goals continue to move into better balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate." It explains, "In support of its goals, the Committee decided to maintain the target range for the federal funds rate at 5-​1/​4 to 5-​1/​2 percent. In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent. In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage backed securities. The Committee is strongly committed to returning inflation to its 2 percent objective." The FOMC adds, "In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee'​s goals. The Committee'​s assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments."

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