We will discuss how money markets differ from “capital markets”, and compare how money market securities differ from money market deposit accounts offered by banks. We will also cover the different issuers of money market securities.
What You’ll Learn
Characteristics and purposes of each of the following:
- T-bills
- Commercial paper
- Eurocurrency (e.g., Eurodollar)
- Negotiable certificates of deposit
- Banker’s acceptances
- Repurchase agreements (generally)
- Tri-party repos (more specifically)
Money market mutual funds:
- Cover the $1 NAV
- Review what happens if “the buck is broken”
Purchasers of MM Securities:
- FRB
- Banks
- Mutual Funds
- Other investors