In an interview, he observes that Fidelity's experience mirrors that of the money market fund industry, showing rapid growth from the late seventies through the early nineties, then declining in late 1992 as interest rates bottomed. In 90' and 91' we got to the bottom of our performance range and just had to let go because we weren't comfortable with some of the credits in domestic banks and in some Japanese banks that some of our competitors were using. They were obviously stretching for yield. By 1993, however, the money market fund division, on average, performed in the top 15 percent of all money market funds. We think that anything that goes into a money market fund should be unleveraged and should move in conjunction with domestic money markets.
Some instruments simply have no business in a money market fund.
It should be noted that Mr. Henning makes no claim to having a crystal ball, to having insight into the inner workings of the Federal Reserve, or to deep knowledge of the seasonal strivings of currencies. Interest rates, when they start to rise, tend to rise for six quarters. Rates haven't been rising for six quarters. That return would have ranked it 874th of the 3,656 equity and bond funds with one year track records. It would also have ranked 65th among the 145 equity and bond funds in the Fidelity and Fidelity Advisor group.