Money Funds Receptive to Fed’s Reverse Repos

After acquiring more than $1 trillion in asset-backed paper from money market funds, the Federal Reserve is considering borrowing that money back from the funds through reverse repos to ease the stimulus plan and avoid inflation, and most funds think that is a good idea.

David Glocke, manager of Vanguard’s money funds, told The Wall Street Journal the plan is “intriguing.” And Debbie Cunningham, CIO of taxable money funds at Federated Investors, said the idea makes sense.