Apr 3, 2020 - Economy & Business

Professional investors keep piling into money market funds amid coronavirus upheaval

Dion Rabouin, author of Markets
Data: Investment Company Institute; Chart: Andrew Witherspoon/Axios

The divergence between professional money managers and retail investors continued this week, as the pros again flocked to cash at a record pace.

What happened: Data from the Investment Company Institute shows institutional asset managers moved $163 billion into money market funds in the week ending April 1, the second-largest move to cash ever recorded, dating back to January 2007.

  • Retail investors, on the other hand, went to cash at a much lower rate, allocating just $13 billion to money market funds, which barely registered among the 50 largest weekly inflows.

Why it matters: The contrast suggests sophisticated investors remain extremely cautious about the outlook for investment and are still seeking the ultimate safe haven, while retail investors are less bearish.

Flashback: Last week, data showed that investment pros were retreating from risky assets while so-called mom and pop investors bought the dip.

The big picture: A record $4.4 trillion is now held in money market funds. That's nearly $500 billion more than the peak level seen during the 2007–2009 global financial crisis.

Go deeper: Money market funds see largest inflows in history for second straight week

Go deeper

Updated 10 hours ago - Health

U.S. coronavirus updates

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios. This graphic includes "probable deaths" that New York City began reporting on April 14.

The Department of Health and Human Services moved on Thursday to require that an individual's race, ethnicity, age and sex be submitted to the agency with novel coronavirus test results.

Why it matters: Some cities and states have reported the virus is killing black people at disproportionately high rates. There are gaps in the national picture of how many people of color are affected, since the data has not been a requirement for states to collect or disclose.

Coronavirus cases spike in Texas, Oregon and Arizona

Data: The COVID Tracking Project, state health departments; Map: Andrew Witherspoon, Sara Wise, Naema Ahmed/Axios

Texas, Arizona and Oregon saw significant spikes last week in new coronavirus infections, while cases also continued to climb in a handful of states where steady increases have become the norm.

Why it matters: Nationwide, new cases have plateaued over the past week. To get through this crisis and safely continue getting back out into the world, we need them to go down — a lot.

Cities are retooling public transit to lure riders back

Illustration: Sarah Grillo/Axios

After being told for months to stay away from others, the idea of being shoulder to shoulder again in a bus or subway terrifies many people, requiring sweeping changes to public transit systems for the COVID-19 era.

Why it matters: Cities can't come close to resuming normal economic activity until large numbers of people feel comfortable using public transportation.