The Fed facility rewards investors who took higher risk and received higher interest rates. (Those who sat in government money market funds received lower returns). Yes, there is a free lunch--and it is paid for by the taxpayers.
(Bloomberg) The Federal Reserve will help finance purchases of up to $600 billion in assets from money- market mutual funds roiled by redemptions from investors seeking the safety of government debt.
``The short-term debt markets have been under considerable strain in recent weeks as money market mutual funds and other investors have had difficulty selling assets to satisfy redemption requests,'' the Fed said in a statement released in Washington today. About $500 billion has flowed out of prime money-market funds since August, a central bank official said.
Read the entire article
Subscribe to:
Post Comments (Atom)
Posts
No comments:
Post a Comment