​ "​Money Market ETFs" Not True Money Markets But Enhanced Cash. TheStreet.​com recently wrote "Money Market ETF Not as Safe as it Appears", describing a new Powershares VRDO Tax-​Free Weekly Portfolio (​PVI). The ETF invests in tax-​exempt variable-​rate demand notes, a staple of tax-​exempt money market funds, and "​seeks to replicate the Thomson Municipal Money Market Data VRDO Index. TheStreet incorrectly terms this new exchange traded fund a "​Money Market", but PowerShares makes no such claim. Other ETFs -- iShares Lehman 1-​3 Year Treasury Bond, SPDR Lehman 1-​3 Mo T-​Bill ETF, and the pending Bear Stearns Current Yield Fund -- have bordered on money markets but are really "​cash plus" or "​enhanced cash". None to-​date offers the liquidity, safety and yield of a true money market fund. The Powershares launch is ill-​timed given concerns in the municipal market over bond insurers, and given concerns over "​enhanced cash" funds in general.

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