My Favorite Chart -- Money Market Funds -- June 18, 2024

Locator: 47878MMFS. 

Link here.

That increase, not only was it a reversal of the two previous months, the increase was not trivial. And, oh by the way, in the process, set an all-time record.

Link here.

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MMFs And The Market

From an earlier post:

Investors are happy about all this cash on the sideline. They shouldn't be; we've discussed this before (December 19, 2023):

More than $6 trillion "on the sidelines." Some talking heads on CNBC and some tweeters opine that a lot of that money could flow back into the equity market in 2024 if the Fed cuts rates. Not gonna happen. Most of that money was moved from checking and savings accounts at banks. Huge problem for regional banks. Some of that MMF money will flow back into the equity market but most of it will stay in MMFs. Compared to MMFs, equities are riskier and even at 2%, MMF compare favorably with equities in many cases. 

People that put money into MMFs are not going to put that money into the stock market. At least not $6 trillion. My mother exemplified the typical "investor" in MMFs, as does my wife.