Money market funds stockpile cash on US default fears

Although the funds still hold US Treasuries, they are stockpiling cash which is distorting the short-term market for government debt and raising borrowing costs for financial institutions, reports the FT. Barclays Capital said cash has been increased from 48% at the end of March to 68% of assets, to meet redemptions. Fidelity's head of money market business, Robert Brown, told the FT the group has built up liquidity with a "meaningful" amount of maturities. Decisions on where to invest cash have also been delayed while money market funds are also avoiding one-month Treasury notes w...