Good sign for the economy, but ...
Bloomberg reports that the Top Money Funds Doubled French Bank Holdings Last Month.
The 10 biggest prime U.S. money market mutual funds more than doubled their holdings in French banks in February, as lending from the European Central Bank bolstered investor confidence. French bank holdings rose to $18.2 billion from $8.8 billion in the month, according to data compiled and published in today’s Bloomberg Risk newsletter. Funds run by New York- based JPMorgan Chase & Co. (JPM) and Boston’s Fidelity Investments accounted for one-third of the total increase.
I love France. The food. The universal early childhood care network. Still, do most money market mutual fund investors know that their funds are hiking their exposure to Eureopean debt?
That said, the increased investments in high-quality short-term European debt is a vote of confidence that the Continent's turmoil is abating somewhat. It suggests we're entering a period of greater stability -- fingers crossed -- which would give room for the U.S. economy to continue expanding. (The Middle East is another story).