Posts belonging to Category Money Market Funds

SEC Reports an Increase in Enforcement Actions


The Securities and Exchange Commission has ramped up enforcement actions against investment advisors, broker-dealers and senior executives over the past two years, the agency said in a statement. SEC Chairman Mary Shapiro attributed the increased activity in part to a reorganization that includes special units staffed by experts in the complex financial products and transactions […]

Investors Should Share Wall Street’s Concern about the Approaching ‘Fiscal Cliff’


A sell-off in U.S. Treasury securities is a virtual certainty and the only question is when and how, according to major Wall Street bankers. Wall Street banks are big holders of Treasury securities and could suffer large losses if there is a sell-off. Wall Street apparently believes that such a sell-off could be drastic unless […]

Investors Have Few Attractive Investment Opportunities at Present


“[I]nvestors face a perfect storm ? risky assets priced to achieve dismal long-term returns (except in comparison to equally dismal alternatives), coupled with the risk of an oncoming recession,” according to John Hussman (“John Hussman: Nearly every asset class set for ‘miserably low’ returns,” InvestmentNews).

Liquidity Crisis Looms


Global liquidity is about to dry up, and “the effect on the real economy will soon be felt,” according to Mark Carney, Chairman of the G-20 Summit’s Financial Stability Board and Governor of the Bank of Canada. European banks are afraid to lend to one another because they do not know the extent of their […]

Stable Value Funds Aren’t So Stable


Investors, especially in retirement accounts, are pouring money into so-called “stable value funds” but the stability of those funds is not as advertised. The funds are often sold as higher-yielding money market funds, but they lack the safety and stability of a money market fund. Also, the higher-than-money-market yield and stability come at a price […]

A Greek Default Could Impact Money Market Funds


In “Would a Greek default be automatic doom?” Mark Hulbert of MarketWatch makes the point that both those who predict that a Greek default would be like the Lehman disaster and those who predict that it would be more like the stock market advances after the last four sovereign debt crises (Mexico 1994, Thailand 1997, […]

Mortgage-Backed Securities Problems Continue to Haunt Bank of America


Bank of America expects to face legal losses this year for anywhere from $145 million to $1.5 billion. And that is just what it can reasonably estimate. Most of these losses stem from the underwriting of mortgage-backed securities.

Some Money Market Funds are Taking on More Risk


Money market funds are accepting more risk in reaching for better yields only two years after the $62 billion Reserve Primary Fund “broke the buck,” according to a recent Wall Street Journal article by Eleanor Laise, “Money Funds Try Risk Again.” This despite new SEC safety rules requiring that 30% of money fund assets must […]

Regulators Charge TD Ameritrade and Amerivest Investment Management with Fraud


Pennsylvania regulators have charged TD Ameritrade with fraud in selling its Reserve Yield Plus Fund, according to an August 4, 2010 Wall Street Journal article by Daisy Maxey, “TD Ameritrade Faces Civil Fraud Complaint Over Reserve Fund.” The Reserve Yield Plus lost money in the midst of the financial crisis in September 2008.

Money Market Funds “Feeling the Heat”


Another asset class is “feeling the heat” of the unstable investment market. The historically reliable asset class of money funds has been hit by the financial crisis, providing minimal yields, at best. The money fund, typically investing in short-term, high-grade IOUs, was once considered “a pillar of safety.” In the past, even if the fund […]