Money Management Executive Latest News

The London interbank offer rates for three-month dollar funds reached a five month low of 2.70625% on Tuesday, but banks still failed to loan money and commercial paper issuance also lags.

The price-to-earnings of stocks and other fundamentals have “improved radically,” John Bogle, founder of Vanguard, told Reuters. “It seems to me that people have lost sight of the fact that the fundamentals have improved radically.”

With the volatility of the stock market seemingly ever on the rise, perhaps now is a perfect time for the launch of 300% leveraged exchange-traded funds from Direxion, both on the long and the short side.

Seeking safety, investors have flocked to Treasury bonds, but now investors are beginning to develop renewed respect for municipal bonds, which are not only tax-free but delivering higher yields, The Wall Street Journal reports.

The Investment Company Institute announced Tuesday that it is forming a money market mutual fund working group, to be chaired by Vanguard Chairman John Brennan.

Encouraged by new lows in the Nikkei Stock Average, as well as other major indices, Japanese investors are buying up stocks, the Nihon Keizai Shimbun reports.

Due to what it calls deteriorating weighted average credit quality, along with a volatile and falling net asset value, Moody’s has downgraded its rating for the Lehman Brothers Enhanced Libor Fund from Aaa/MR3 to A/MR5. Moody’s said the rating would remain on review for further downgrade, due to its holdings in securities backed by residential mortgages and credit card payments.

Unlike most other markets around the world where hedge funds are allowed to take almost any risks they deem fit, including leveraging their holdings to place outsized bets, Brazil’s hedge fund managers must comply with strict parameters, Dow Jones reports. That means they cannot take margin or collateral calls.

The $3.2 billion Vanguard Insured Long-Term Tax-Exempt Fund is being liquidated and folded into the $2.8 billion Vanguard Long-Term Tax-Exempt Fund.

After a $200 billion run on money market funds in September, the operations of, and flows to, money market funds are beginning to return to normal, the South Florida Sun-Sentinel reports.