5 min readConflicting regulations could limit the rates that money market mutual funds pay investors, a senior Fidelity Investments executive said, reflecting some of the many forces weighing on the sector. Rules passed by the U.S. Securities and Exchange Commission in 2010 require funds operated by Fidelity and its rivals to own more short-term securities, said Robert…
7 min readFirst, the Standard & Poor’s downgrade of its rating on the U.S. sent shivers through the corporate finance — and the rest of the world — late last week, dropping the nation from AAA to AA+. In its report explaining the change, S&P described Washington’s compromise fiscal consolidation plan as falling short “of what, in…
3 min readThe financial meltdown in the fall of 2008 prompted many large companies to prep for future calamities, but recent events are pushing them to accelerate the implementation of those defensive moves. Corporate giants including Coca-Cola, Hyatt Corp., Kinder Morgan and J.P. Morgan have issued upwards of $5 billion in long-term debt over the last week,…
22 min readThe world is preoccupied with sustaining the economic recovery, preventing countries from defaulting in Europe and proceeding with post-financial-crisis regulation in the United States. Those themes are evident in Treasury & Risk’s 100 Most Influential People in Finance roster for 2011, which includes government officials wrestling over how to regulate derivatives, policymakers worldwide dealing with…
133 min readUnofficial Transcript: Roundtable on Money Market Funds and Systemic Risk May 10, 2011 Participants : Chairman Mary L. Schapiro Commissioner Kathleen L. Casey Commissioner Elisse B. Walter Commissioner Luis A. Aguilar Commissioner Troy A. Paredes Chairman Sheila C. Bair, Federal Deposit Insurance Corporation Chairman Gary Gensler, Commodity Futures Trading Commission Chairman Deborah Matz, National Credit…
3 min readLike the diligent shopper who combs the fine print of breakfast cereal ingredients trying to spot synonyms for “sugar,” CFOs and treasurers have to be on the lookout for a new sweetener in their short-term cash portfolios. Called collateralized commercial paper (CCP), the instrument is an asset-backed security targeted to prime money-market funds, a popular…
2 min readThe role that asset-backed securities (ABS), such as mortgages, played in the recent financial meltdown led both investors and issuers to shun entire classes of securitized investments. For instance, the value of U.S. credit card-backed ABS plummeted from $402 billion in 2003 to $206 billion in 2010, according to the Securities Industry and Financial Markets…
3 min readCredit woes haven’t diminished money-market funds’ appetite for European bank debt. The largest U.S. prime money-market mutual funds in recent months have boosted their exposure to European bank holdings like certificates of deposit and commercial paper, according to new figures set to be released Friday by Fitch Ratings. Such holdings now account for about 39%…
2 min readAt its meeting earlier this week, the Federal Reserve announced its plans to purchase $600 billion in Treasury securities over the next 8 months, or at a rate of about $75 billion per month. This second round of quantitative easing — QE2 as it’s quickly become known — is designed to “promote a stronger pace…
1 min readTEXT OF INTERVIEW STEVE CHIOTAKIS: News from the Labor Department today. First-time unemployment claims rose last week by 13,000 to top 462,000. But the number of jobless workers continuing to collect benefits fell last week. Lance Pan is Director of Investment Research at Capital Advisors Group. He’s with us live from Boston. Good morning, sir….