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By ANDREW LECKEY | November 16, 2008
Q: I have heard the term "breaking the buck" in regard to money market funds. I know Reserve Primary Fund did this due to Lehman Brothers debt securities. Is this a problem for all money-market funds? - K.H., via the Internet A: "Breaking the buck," or having per-share value fall below a dollar, is rare, and money-market funds are considered quite safe. But the episode with Reserve Primary Fund shook the confidence of many investors, who moved large amounts of cash from money-market funds into bank money-market accounts insured by the Federal Deposit Insurance Corp.
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BUSINESS
By Michael Bodley, The Baltimore Sun | July 31, 2014
Legg Mason Inc. reported Thursday its quarterly profit grew 51 percent, thanks to a strategy that has diversified the money manager's investment portfolio. The Baltimore-based company said it earned $72.2 million, or 61 cents per share, in the three months ended June 30, compared with $47.8 million, or 38 cents per share, a year earlier. Revenue for the quarter rose 4 percent to $693.9 million. While Legg Mason announced in May it had reversed a six-year outflow of client money, the recent quarter brought a net outflow of $8.2 billion, nearly all from liquid investments such as money market funds.
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BUSINESS
By WERNER RENBERG and WERNER RENBERG,1992, Werner Renberg | July 12, 1992
When the Federal Reserve acts to stimulate the U.S. economy by initiating cuts in interest rates, as it did again recently, the impact on economic growth usually is not quickly evident.Prospective business and individual borrowers, who may want to build plants or homes, first must decide to borrow what they need.But lenders -- investors who make money available by buying U.S. Treasury securities, bank certificates of deposit and other corporate and government obligations -- can feel the impact fairly fast as their interest income declines.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | October 25, 2013
Legg Mason Inc., which continues to struggle with money flowing out of its stock funds, reported Friday it earned $86.3 million in the second quarter ended Sept. 30, a 6.8 percent increase over a year ago. On a per-share basis, the Baltimore-based money manager earned 70 cents in the quarter, compared with 60 cents the year before. That was well above analysts' expectations of 62 cents per share, said Christopher Harris, a senior analyst with Wells Fargo Securities, in a research note.
BUSINESS
By Charles Jaffe | September 4, 2007
One person's flight to safety is another person's panic. But no matter what you call it, many investors are making an unnecessary trip in that direction with their money-market mutual funds. Market concerns are behind the flight to quality that has pushed assets in money-market funds to a record $2.72 trillion. But if you have been thinking that you might join in that journey and change your money-market fund to gain additional safety, think again; the journey isn't only unnecessary, but you're already too late.
BUSINESS
By WERNER RENBURG and WERNER RENBURG,1991, Werner Renberg | May 26, 1991
If you have some cash in a money-market mutual fund, you're probably disappointed with its current yield of less than 6 percent. Occasionally, you may even wonder whether your principal is safe.Unless you switch to another fund that's better managed or has lower annual expenses, you can't do much to increase your income from a money-market fund. You'll just have to wait until short-term interest rates rise again.But starting next Saturday, you won't have to be so concerned about your fund's safety.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | May 28, 2013
Baltimore's two major mutual fund companies have joined a small but growing number of investment firms offering ultrashort-term bond funds, which may become an alternative to the traditional money market fund. The T. Rowe Price Ultra Short-Term Bond Fund launched in December and has $175 million in assets. Legg Mason Inc.'s California subsidiary this month filed to register the Western Asset Ultra Short Obligations Fund with regulators. There are now close to 50 ultrashort bond funds, with seven of them introduced last year, according to Morningstar Inc., which tracks funds.
BUSINESS
May 4, 1995
Fidelity names fund directorFidelity Investments, whose bond mutual funds were stung last year by rising interest rates and risky investments, named managing director Fred Henning yesterday as director of its fixed-income and money market funds.Mr. Henning's predecessor, Thomas Steffanci, resigned in January to become a principal with Alpha Select Investments Inc. in Portsmouth, N.H., after a year in which 18 of Fidelity's 20 taxable bond funds suffered losses.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | June 26, 2012
Battle lines are being drawn over whether money market funds need more protection in the event of another financial crisis. Maryland investment firms and the state treasurer are on one side of the fight; the SEC chairman is on the other. Baltimore's T. Rowe Price is working through the Investment Company Institute, a trade group for mutual fund companies, which maintains that reforms adopted two years ago, after the last crisis, are sufficient. Legg Mason's CEO said last month that the Baltimore-based investment company might reconsider its commitment to the money market fund business if additional changes proved too drastic.
BUSINESS
By Hanah Cho, The Baltimore Sun | October 22, 2010
T. Rowe Price Group's profit rose 27 percent in the third quarter, buoyed by a market rebound and $8 billion in client investments. The Baltimore money manager said Friday that net income rose 27 percent to $169.1 million, or 64 cents per share. That's compared with a profit of $132.9 million, or 50 cents per share, in the corresponding period last year. Shares rose 4 percent, or $2.19, to close Friday at $54.89. Clients added $1.8 billion to Price's bond funds, but withdrew $600 million from its stock and blended-asset mutual funds and $100 million from money market funds.
NEWS
October 9, 2013
The latest out of the extreme conservative wing of the Republican party is that a failure of the U.S. government to take the steps necessary to pay all its bills on time would be no biggie. They say we could juggle things around and avoid missing any payments on the debt, which they figure is the only thing our creditors really care about. Some, such as Sen. Rand Paul, go a step further and say failure to raise the government's borrowing limit might be a blessing: "If you don't raise the debt limit," he told the New York Times, "all you're saying is, 'We're going to be balancing the budget.'" Um, no. What you're saying is that the federal government is going to start picking and choosing which bills to pay. Depending on the vagaries of cash flow, maybe today the military doesn't get paid, maybe tomorrow Social Security checks don't go out, or maybe Medicare can't cover its bills.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | May 28, 2013
Baltimore's two major mutual fund companies have joined a small but growing number of investment firms offering ultrashort-term bond funds, which may become an alternative to the traditional money market fund. The T. Rowe Price Ultra Short-Term Bond Fund launched in December and has $175 million in assets. Legg Mason Inc.'s California subsidiary this month filed to register the Western Asset Ultra Short Obligations Fund with regulators. There are now close to 50 ultrashort bond funds, with seven of them introduced last year, according to Morningstar Inc., which tracks funds.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | January 29, 2013
T. Rowe Price Group on Tuesday reported a $232 million profit for the fourth quarter, a 23 percent increase from a year earlier. The Baltimore-based investment firm earned 88 cents a share for the quarter ended Dec. 31. That's up from 73 cents a share a year earlier, but still a penny less than analysts expected. Revenue reached $787.3 million for the quarter, compared with $671.6 million the year before. This, too, was slightly below analysts' expectations. Price shares fell sharply in early trading, but recovered somewhat to close Tuesday at $71.61, down 57 cents a share.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | October 24, 2012
Buoyed by rising assets under management and market gains, T. Rowe Price Group reported Wednesday that it earned $247.3 million, or 94 cents per share, for the third quarter. Revenue reached $769.7 million for the three months ending Sept. 30. A year earlier, the Baltimore-based investment company earned $185.5 million, or 71 cents per share, on revenue of $679.4 million. The third-quarter results included a one-time gain of $31.2 million, accounting for 7 cents per share, from the sale of securities from a number of funds, said James A. C. Kennedy, president and CEO. That gain was re-invested in some of Price's European portfolios to beef up their assets and attract institutional shareholders, he said.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | July 27, 2012
Legg Mason Inc. reported Friday that it lost $9.5 million in the first quarter, citing the costs of restructuring debt and launching two funds. On a per-share basis, the Baltimore-based investment firm lost 7 cents. Total revenues for the quarter reached $630.7 million. A year earlier, Legg earned $60 million, or 40 cents per share, on total revenues of $717.1 million. Analysts had expected Legg to report a profit of 3 cents per share, according to Bloomberg, which noted that this was the company's first quarterly loss since early 2009.
BUSINESS
By Eileen Ambrose, The Baltimore Sun | June 26, 2012
Battle lines are being drawn over whether money market funds need more protection in the event of another financial crisis. Maryland investment firms and the state treasurer are on one side of the fight; the SEC chairman is on the other. Baltimore's T. Rowe Price is working through the Investment Company Institute, a trade group for mutual fund companies, which maintains that reforms adopted two years ago, after the last crisis, are sufficient. Legg Mason's CEO said last month that the Baltimore-based investment company might reconsider its commitment to the money market fund business if additional changes proved too drastic.
BUSINESS
By Knight-Ridder News Service | May 26, 1991
PHILADELPHIA -- You can earn higher interest on a free checking account without having to maintain high minimum balances to avoid hefty bank fees.This alternative checking account pays up to 1 percent higher interest than most banks, yet it costs less.The alternative: certain money-market mutual funds that offer unlimited checking without fees or balance requirements. They let you write as many checks as you want and for any amount, no matter how small.But money-market accounts also have disadvantages.
BUSINESS
By GAIL MARKSJARVIS and GAIL MARKSJARVIS,CHICAGO TRIBUNE | June 18, 2006
What's wrong with cash? Not a thing. If you can't stomach the market's recent plunge, you could move a little money into a high-yielding savings account or money-market fund temporarily and earn close to 5 percent. In fact, some institutions are higher. EverBank of Jacksonville, Fla., offers high-interest checking accounts over the Internet with a 5.5 percent three-month teaser rate, then 3 percent to 4 percent later, depending on the amount kept in the account. Parking money at rates approaching the 5.9 percent historical average on long-term U.S. Treasury bonds certainly has appeal now. Virtually every type of investment, from gold to stocks and bonds, has been pummeled since early May. Gold futures are down about 20 percent, the Dow has lost more than 5 percent, and the average international fund has bled about 13 percent.
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