Steve Chiotakis: From Chinese exports, to investment accounts here in the U.S. Some bankers are worried about how the Greek debt crisis could affect money market funds in this country. Congress will get a chance to ask about that this morning at a hearing on Capitol Hill.
From Washington, here’s Marketplace’s David Gura.
David Gura: These funds aren’t big money makers, but they’re relatively low-risk.
Paul Stevens heads the Investment Company Institute. That’s the investment industry’s trade association.
Paul Stevens: None of our money funds have any direct exposure to Greek debt.
Of the $2.7 trillion invested in money market funds, not one cent, Stevens says, is directly tied to Greek government debt.
But Federal Reserve Chairman Ben Bernanke told reporters…
Ben Bernanke: They do have very substantial exposure to European banks in the so-called core countries.
Including France and the United Kingdom. Money market funds may have bought securities from European banks that invested in Greek debt.
But Guy LeBas, a strategist with Janney Montgomery Scott, says he’s not worried.
Guy LeBas: The reason being is that the Federal Reserve and the European Central Bank and central banks around the globe have learned well how to slow a contagion.
A big money-market fund failed during the financial crisis, and LeBas says central banks don’t want to see that happen again. If things get worse, he says, central banks would do all they could to keep other banks from toppling.
In Washington, I’m David Gura for Marketplace.
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