Money Talk: Record $33 billion pulled from active U.S. stock funds in July

by Talk Business & Politics staff (staff2@talkbusiness.net) 148 views 

Editor’s note: Each Monday, Talk Business & Politics provides “Money Talk,” a wrap-up of banking and financial news. ––––––––––––––––

BLOOMBERG: RECORD $33 BILLION PULLED FROM ACTIVE U.S. STOCK FUNDS IN JULY

Investors pulled $32.9 billion last month from actively managed U.S. mutual funds that buy domestic stocks in July, the biggest monthly outflow in data going back to 1993, as money continues to move into low-cost passively managed funds.

About an equal amount, $33.8 billion, went into passive funds that invest in U.S. equities, Chicago-based researcher Alina Lamy of Morningstar said in an interview with Bloomberg News on Friday.

U.S.-based active funds that buy domestic equities had redemptions of $211 billion in the 12 months through July, while investors poured $163.6 billion into passively managed funds during the period as active managers failed to generate returns above indexes that justify their higher fees. Almost $401 billion has flowed into passively managed mutual funds and exchange traded-funds over the past year as $327.8 billion was withdrawn from actively-managed funds. Passively-managed funds now oversee about 43% of U.S. equity funds and 28% of U.S. taxable bonds, according to Morningstar.

FED, POLICYMAKERS TO HOST COMMUNITY BANKING CONFERENCE IN ST. LOUIS IN LATE SEPTEMBER

Community bankers, academics, policymakers and bank supervisors from around the country will meet Sept. 28-29 at the Federal Reserve Bank of St. Louis for the fourth annual Community Banking in the 21st Century research and policy conference.

The conference is hosted by the Federal Reserve System and the Conference of State Bank Supervisors (CSBS) and features the latest in community banking research. More information about the 2016 conference, which will be live-streamed, can be found here.

Federal Reserve Bank of St. Louis President James Bullard will give welcoming remarks, along with CSBS Chairman and Texas Department of Banking Commissioner Charles Cooper. Keynote speakers will include Federal Reserve Governor Jerome Powell, Federal Reserve Bank of Chicago President Charles Evans, and H.E. “Gene” Rainbolt, chairman of BancFirst Corp. in Oklahoma City, Okla. John Ryan, CSBS president and CEO, will wrap up the conference on Sept. 29.

OBAMA ADMINISTRATION ISSUES FINAL RULES ON ‘PHASED RETIREMENT’ FOR FEDERAL EMPLOYEES

The U.S. Office of Personnel Management (OPM) on Aug. 7 issued the final regulations on Phased Retirement, a new voluntary program for approved retirement-eligible federal employees to transition to retirement while still working part time. Employees who are eligible for Phased Retirement and want to continue working on a part-time basis may do so with the agreement of their federal agencies.

According to the General Accountability Office, more than a third of career federal employees are projected to be eligible for retirement by September 2017, compared to just 14% at the same time in 2012. OPM Director Katherine Archuleta said the Obama administration’s retirement planning program provides a new tool that allows managers to better provide unique mentoring opportunities for employees while increasing access to the decades of institutional knowledge and experience that retirees can provide.

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