Money market funds play a critical role in meeting the short-term capital needs of American businesses. For many businesses cash inflows and outflows don’talways line up, and money funds act as a financial intermediary in helping them offset these discrepancies. When cash outflows are greater than inflows, they turn to short term financing, and money market funds are often where these short-term instruments are ultimately placed. When cash inflows are greater than outflows, they invest the cash in money market funds.
