Cash Is King Again: $166B Flees to Money Funds as Yields Reach 24-Year Fever Pitch 💸

Investors poured $166.4 billion into money market funds in a single week, the largest weekly inflow since the April 2020 Covid crash, according to Bank of America data. The move, disclosed in BofA fund flow figures and flagged on social media by Barchart on October 9, 2026, points to a bond market shock rather than an equity sell-off. The 10-year US Treasury yield climbed to 5.36%, a roughly 24-year high, while the 30-year yield touched 5.70%, according to TradingView data cited by Forbes.

The yield surge has been linked to oil-fueled inflation, the Federal Reserve's September rate hike, and a $1.9 trillion federal deficit. With new bonds offering richer returns, older fixed-income holdings have lost value, pushing allocators toward cash-equivalent vehicles that lend to the US government for short terms and maintain a stable share price near $1. Money market fund assets now stand near $8 trillion, up from $5 trillion in 2023, BofA said.

Bank of America Chief Strategist Michael Hartnett framed the dynamic bluntly: "No rate cuts, no cash cuts." Traders see no chance of a rate reduction at the Fed's October meeting. While macro voices are divided, Bianco Research President Jim Bianco, bearish on bonds for six years, has turned bullish on the long end, arguing 5% yields align with economic growth. Bridgewater Associates founder Ray Dalio, meanwhile, has warned that rising yields are eroding the equity valuation cushion.

Crypto markets registered collateral damage during the same week, with crypto funds posting $600 million in outflows while gold drew roughly $2 billion in inflows. The contrast underscores that the rotation has favored perceived safety across multiple asset classes, with money market funds absorbing the bulk of capital as yields and policy expectations keep investors anchored in cash.