Recent Reads

Why [Some] Investors Seem to Ignore The likelihood of Lower Rates Ahead

By Marty Margolis on September 4, 2024

The path ahead for interest rates seems clear: the Federal Reserve will soon begin to reduce its policy rate, bringing down short-term rates generally. This has been the outlook for a couple of months, with only the timing and magnitude of cuts in question. Meanwhile money market fund assets grew steadily this year and are […]

Slow Progress: The Opportunity to Expand FDIC Insurance for Public Units

By Marty Margolis on August 19, 2024

In the aftermath of last year’s bank crisis there were calls to reform federal deposit insurance to add stability to the banking system and diminish the risk of runs on smaller community banks. Deposit reform could also improve the banking environment for state and local governments if they organize around this issue and raise their […]

What the Big Bond Market Rally Means for Public Funds Investors*

By Marty Margolis on August 5, 2024

Last week’s big decline in interest rates feels a lot more real than the similar move at the beginning of the year. If so, what does it mean for public funds investors? The rally in bond prices boosted the returns on our 1–3-year model portfolio ahead of cash returns for the first time in several […]

Is Texas a Model of a Public Funds Investor-Friendly Market?

By Marty Margolis on August 1, 2024

Texas could be the model for an investor-friendly public funds investment market, with a robust state-sponsored local government investment pool and a number of sizable alternatives that provide public funds investors competitive choices, low fees, risk guardrails and significant disclosure requirements. The details. Texas is the second most populous state, and with 5,500 local governments […]

New Research Report Details the Role of State-Sponsored Local Government Investment Pools as the Foundation of a $900 Billion Industry

By Marty Margolis on July 24, 2024

A new research report by the Public Funds Investment Institute details the role of state treasurer-sponsored local government investment pools as a foundation of the $900 billion industry that provides money market-like investments to state and local governments. State treasurers in 32 states offer these funds and their assets total nearly $700 billion. Local-sponsored LGIPs with an estimated $200 billion […]

Cash and Short-Term Portfolios Had Strong Returns in the First Half of the Year

By Marty Margolis on July 9, 2024

The PFII Investment Dashboard has been updated through quarter-end and reflects a couple of interesting market dynamics. The 1-3-year model portfolio yield to maturity of 4.95% at the end of the quarter reflects this. The model portfolio also benefitted from holding corporate obligations. Thirty percent of the portfolio is invested in investment grade credit which […]

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Key metrics and trends in the public funds investment market.