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Massive net outflow from money market funds-Lipper
August 4, 2011 / 10:00 PM / 6 years ago

Massive net outflow from money market funds-Lipper

 NEW YORK, Aug 4 (Reuters) - Investors pulled nearly $66
billion from money market funds in the week ended Aug. 3, the
second-largest net outflow on record, data from Lipper showed
on Thursday.
 "We think the money came out of money market funds last
Thursday and Friday because the government had not broken the
deficit and debt ceiling stalemate by then," said Tom Roseen,
senior analyst at Lipper, a Thomson Reuters company.
 "You have to assume investors are taking it and sacking it
away somewhere else. People are moving to banks and just
looking for a safe place to hide it," he added.
 The deal reached on Tuesday to cut the U.S. deficit and
raise the statutory debt limit occurred while financial markets
were, and remain, in a tailspin. That left neither the time nor
readily apparent alternatives for investors to move the cash to
new investments.
 Equity funds had net outflows of $7.4 billion while taxable
bond funds had net outflows of $1.3 billion, the first time
both sectors have had net redemptions since the first week of
December 2010.
 The money coming out of taxable bond funds broke a 32-week
streak of net inflows that brought in a cumulative $107.3
billion.
 Money market funds suffered their biggest outflow on record
during the week ended Sept. 17, 2008, at the height of the
financial crisis, when investors pulled $144.4 billion out of
the sector.
 The weekly Lipper fund flow data is compiled from reports
issued by U.S.-domiciled mutual funds and exchange-traded
funds.
 The following is a broad breakdown of the flows for the
week, including exchange-traded funds (in $ billions):
Sector                    Flow     Change     Total     Share
                      Change  in Assets    Assets    Class
                                (pct)                Count
=============================================================
All Equity Funds         -7.473   -0.26     2,781.566 10,150
- Domestic Equities      -6.033   -0.28     2,043.656  7,673
- Non-Domestic Equities  -1.439   -0.19       737.910  2,477
All Taxable Bond Funds   -1.294   -0.09     1,407.740  4,273
All Money Market Funds  -65.841   -2.76     2,319.588  1,507
All Municipal Bond Funds -0.861   -0.26       331.175  1,582
 (Reporting by Daniel Bases; Editing by Dan Grebler)


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