Immediately after Lehman Brothers failed, a money market mutual fund called Reserve Primary "broke the buck"--it did not have enough money in its coffers to pay the shareholders what they'd had. Since money market funds are essentially used as bank accounts, this was a big problem--and it triggered a bank run on the money markets, which ended only when the government stepped in and said it would backstop these funds.
Flows into equities this month have been breaking all kinds of records, and they've spurred a lot of chatter about a "Great Rotation" out of fixed income funds and into equity funds as stocks climb higher.
By John M. Mason: On Sunday I reported that funds have been flowing back into money market funds since late October and early November … a three-month move. Now, the Investment Company Institute (ICI) confirms this flow of funds.
Michael Johnston submits:For investors in the process of rebalancing their portfolio or taking a step back from the stock and bond markets, money market accounts have historically provided an opportunity to generate returns over the short run while maintaining the flexibility to redeploy assets at any time. During periods of sustained economic growth and bull market rallies, these investments have often provided attractive, risk-free returns.
Banking abroad is as ordinary as a winter home in Florida or a business office in London.
Most of the accounts are for convenience, such as paying utility bills for a condo beneath the palms and getting access to an ATM without paying heavy fees when drawing U.S. currency.
The names of at least 450 wealthy Canadians were contained on a massive list of offshore tax haven account holders, leaked to the Washington-based International Consortium of Investigative Journalists and widely reported Wednesday.
There can be little doubt of fraudulent tax avoidance in Greece. However, the Greek solution (seize money first, then place charges and hold trials later) leaves a lot to be desired.
Please consider Greece to seize money from suspected tax evaders' accounts
The Greek government is to begin seizing money from the bank accounts of suspected tax evaders, Finance Minister Filippos Sachinidis told Skai TV on Thursday.
Annaly Salvos submits: According to the Federal Reserve, money market fund holdings of households has declined by about $380 billion since the end of 2008. (According to AMG, all money market mutual funds—institutional and retail—have posted net outflows of about $1 trillion over that time.) When we see big flows like that, we scratch our heads and ask what’s going on.