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The Financial Times writes, "​Floating rate Treasuries register strong demand". The article comments, "Investor demand for the first new US Treasury security in 16 years pulled in orders worth nearly six times the size of the issue on Wednesday, ahead of another debt ceiling showdown in Washington. The Treasury sold $​15bn of floating rate notes, whose benchmark rate is based on the three-​month Treasury bill yield, and attracted orders of $​85bn, a healthy bid-​to-​cover of 5.​67 times. Dealers underwriting the sale bought $​7.​94bn of the sale, with investors accounting for just under half of the entire issue.... Money market funds, starved by low yields and worried about sharp swings in short-​term bills because of the prospect of another Federal debt ceiling battle in March, are expected to seek the new floating rate note that has a maturity of two years. Peter Crane, president of Crane Data, a money market research firm, said: "Treasury money market funds are so starved for yield that anything giving them an extra basis point or two, and with the same quality and liquidity features of a Treasury security, means it'​s a no brainer for them to own.""

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The Preliminary (​draft) Agenda for the 2014 Crane'​s Money Fund Symposium has now been posted on the www.​moneyfundsymposium.​com website. Crane'​s Money Fund Symposium 2014, which will take place June 23-​25, 2014, at the Boston Renaissance Waterfront, should once again be the largest gathering of money market professionals anywhere. (​We attracted over 450 last summer at our event in Baltimore.) Some speakers and invitations are still being confirmed, but we also expect once again to have the most knowledgeable and highest level speakers in the money fund and cash investment business. E-​mail Pete to request a copy of the conference brochure, which will be released to subscribers of our Money Fund Intelligence with the February issue. Join us too next week at our latest Crane'​s Money Fund University, which will take place January 23-​24 (​Thurs. and Friday) at the Providence Renaissance Hotel. MFU is our smaller "​basic training" event held each January for investment professionals new to the money fund space or for those seeking certification in the money market field. Finally, mark your calendars our second European Money Fund Symposium, which is scheduled for Sept. 23-​24, 2014, in London. Contact us about speaking and sponsorship opportunities for this or any of our future events.

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The New York Times writes "​An Advantage Vanishes for Money Funds". It says, "​When money market mutual funds were invented back in 1971, they offered something new. Investors could earn higher yields than on bank deposits, with nearly the same liquidity and safety. But that has changed. Currently, a money market deposit at Citibank pays about five times as much interest as an investment in the Fidelity Cash Reserves fund -- though, in today'​s low-​rate environment, the yields are minuscule. The bank'​s advantage appears to be a trend. In early 2007, money market mutual funds typically paid almost four percentage points more than bank deposit accounts, according to the Investment Company Institute, a trade association. But ever since 2009, bank money market deposit accounts have consistently paid more, on average, than their mutual fund counterparts." They quote our Peter G. Crane, a founder of the money market fund information company Crane Data, "The zero-​interest-​rate environment has been brutal on money market funds. They have lost their yield advantage." The piece adds, "​The difference between 0.​05 percent and 0.​01 percent may not look like very much. But then again, the appeal of a money market mutual fund in the first place was that you could earn more than you could get from your bank. That helps explain a surge of outflows from money market mutual funds in 2010 and 2011." See also, Gretchen Morgenson'​s latest anti-​Wall Street and anti-​fund rant, "​Bailout Risk, Far Beyond the Banks".

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The January issue of Crane Data'​s Money Fund Intelligence was sent out to subscribers this morning. The latest edition of our flagship monthly newsletter features the articles: "Reviewing Highlights of '​13; More Regs & Rates in '​14," which reviews the major stories of 2013 and gives an outlook for the coming year; "Treasury Partners' Klein on Portal, Separate Accounts," which interviews one of the principals of a major online money market trading "​portal"; and, "Top MMFs of 2013; Our 5th Annual MFI Awards," which reviews the top-​performing money funds of 2013 and of the past 5 and 10 years. We'​ve also updated our Money Fund Wisdom database query system with Dec. 31, 2013, performance statistics and rankings, and will be sending out our MFI XLS spreadsheet shortly. (MFI, MFI XLS and our Crane Index products are available to subscribers at our Content center.) Our December 31 Money Fund Portfolio Holdings data are scheduled to go out on Friday, Jan. 10.

The "​profile" with Treasury Partner'​s Klein says, "This month, we interview Jerry Klein, Managing Director/​Partner of Treasury Partners, and discuss the online money market fund trading portal business, as well as recent trends in separately managed accounts and cash investing. Our Q&​A follows." (​Watch for excerpts of this interview later this month, or write us to request the full article.)

Our article on the MFI Awards explains, "In this issue, we once again recognize some of the top-​performing money funds, ranked by total returns, for calendar 2013, as well as the top-​ranked funds for the past 5-​year and past 10-​year periods. We present the following funds with our annual Money Fund Intelligence Awards. On page 7, we show a table with the winners. These include the No. 1-​ranked funds based on 1-​year, 5-​year and 10-​year returns, through Dec. 31, 2013, in each of our major fund categories (​our "​Type") -- Prime Institutional, Government Institutional, Treasury Institutional, Prime Retail, Government Retail, and Treasury Retail."

MFI says, "​The top-​performing Taxable fund overall in 2013 and top among Prime Institutional funds was BlackRock Cash Inst MMF Inst (​BGIXX), which returned 0.​15%. (​We excluded BlackRock Cash'​s SL class due to its limited availability.) Among Prime Retail funds, Meeder Money Market Fund Retail (​FFMXX) again had the best return in 2013 (​0.​14%). (​It previously was named Flex-​fund.) Western Asset Inst Govt MM A (​INGXX) won the Top Government Institutional fund over a 1-​year period with a return of 0.​05%, while Davis Government MMF A (​RPGXX) won the MFI Award for Government Retail Money Funds (​1-​year return). Morgan Stanley Inst Liq Treas Inst (​MISXX) ranked No. 1 in the Treasury Institutional class, and Morgan Stanley Inst Liq Treas Cash Mgt (​MREXX) ranked tops among Treasury Retail funds."

On the "Top Funds Over Past Five Years, we write, "For the 5-​year period through Dec. 31, 2013, Touchstone Inst MMF (​TINXX) again took top honors for the best-​performing money fund with a return of 0.​34%. Meeder Money Market Fund Retail ranked No. 1 among Prime Retail with an annualized return of 0.​23%. Western Asset Inst Govt MM A ranked No. 1 among Govt Institutional funds, while Vanguard Federal Money Mkt Fund (​VMFXX) and Weitz Government Money Mkt (​WGMXX) both ranked No. 1 among Treasury Retail funds over the past 5 years. Vanguard Admiral Treasury MM (​VUSXX) ranked No. 1 in 5-​year performance among Treasury Inst money funds, and Northern Trust Treasury Money Mkt (​NITXX) ranked No. 1 among Treasury Retail funds.

We awarded the "Best Money Funds of the Decade titles to, "The highest-​performers of the past 10 years include: DWS Daily Assets Fund Inst (​DAFXX), which returned 1.​94% (​No. 1 overall and first among Prime Inst); Fidelity Select MM Portfolio (​FSLXX), which returned 1.​78% (​the highest among Prime Retail); American Beacon US Govt Select (​AAOXX), which returned 1.​74%, (​No. 1 among Govt Inst funds); and, Vanguard Federal Money Market Fund (​VMFXX), which ranked No. 1 among Govt Retail funds (​1.​67%). Milestone Treasury Obligs Fin (​MIL01) returned the most among Treasury Institutional funds over the past 10 years; and, Goldman Sachs FS Trs Obl Sel (​GSOXX) ranked No. 1 among Treasury Retail money funds."

MFI adds, "See our additional rankings tables on pages 9-​11, and see our Money Fund Intelligence XLS for more detailed listings, percentiles, and rankings. Look for more details in coming days on the website too (​www.​cranedata.​com). Winners will receive a letter and certificate stating their No. 1 ranking and the criteria used."

Finally, we'​re look forward to seeing some of you at our "​basic training" conference event, Crane'​s Money Fund University, in just over 2 weeks (Jan. 23-​24, 2014) in Providence, Rhode Island. Our 4th annual MFU will contain a heavier focus on money fund regulations, and will, as always, cover the basics of money funds, interest rates, and overviews of various money markets. Our next main event, Crane'​s Money Fund Symposium, will take place June 23-​25, 2014, in Boston, and our second annual "​offshore" event, European Money Fund Symposium, will take place Sept. 23-​24 in London. Registrations and sponsorships are now being accepted for our 2014 Symposium, and the preliminary agenda is being finalized. (​Watch for the agenda late this week or next.)

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The Wall Street Journal asks "​Do Money-​Market Funds Still Make Sense?" The piece says, "​For the past few years, investors could probably have made more money by picking up loose change from the sidewalk than by investing in a money-​market mutual fund. Money funds are likely to regain appeal once interest rates rise again. Historically, when rates start moving upward, money-​fund yields quickly follow, unlike those of bank savings accounts, which can lag. But for now, persistently low rates -- coupled with uncertainty about a possible regulatory overhaul for money funds -- are reasons to avoid using the funds for all but very-​short-​term parking of cash, financial advisers say.... The average yield on taxable money funds for individual investors is just 0.​01% a year, according to Crane Data LLC of Westborough, Mass. On an investment of $​10,​000, that is $​1 a year. Such low yields are unlikely to climb soon, as many market professionals think there is still too much economic uncertainty for the Federal Reserve to start raising short-​term rates. Moreover, the reason money funds have been able to offer any yield at all in recent years is that management companies have been waiving billions of dollars in fees.... With the exception of the Reserve Primary Fund, money-​market funds came through the financial crisis and other turmoil, including the European debt crisis and the U.​S. federal-​government shutdown, unscathed. But still the Securities and Exchange Commission is considering new regulations to avoid future runs on funds." The article quotes, Peter Crane, president of Crane Data, "A floating NAV would really harm one of the core features of money-​market funds. Investors want the ability to transact and not have to worry about gains and losses, or not having the amount that you thought you had." The Journal adds, "The timing of any SEC action is uncertain."

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