Dear Etorians, A $6 trillion haul could be the fuel to propel U.S. stocks to new highs as the Fed changes course. Rising yields have drawn liquidity into money markets, as many investors have chosen to take refuge in these ultra-safe vehicles while waiting to see how the Fed will manage inflation. Total money market fund assets hit a record $5.9 trillion on Dec. 6, according to data from the Investment Company Institute. The Fed's reversal on Wednesday may have upended that strategy: if borrowing costs fall in 2024, yields will likely fall at the same time. That could prompt some investors to come out of hiding and invest in stocks and other riskier investments, while others might rush to lock in longer-term bond returns. Historically, cash returned an average of 4.5% in the year following the Fed's last rate hike of a cycle, while U.S. stocks surged 24.3% and debt surged 24.3%. quality of 13.6%, according to BlackRock data going back to 1995. "We get calls [...] from customers who have a bunch of cash and realize they need to make some something,” said Charles Lemonides, portfolio manager at hedge fund ValueWorks LLC. “It’s the beginning of a cycle that will start to feed on itself.”