The Role of Money Market Funds in the Financial System

Money market funds can only buy short-term dated paper that doesn't pay a coupon. So basically they can take money out of the RRP and lend into repo. An interesting thing though, you see in this chart, is that pipe where dealer repo barring is actually narrower than it was in 2008. It used to be 3 trillion now to 1.5 trillion. But at the same time, the amount of treasuries in the system has grown a lot.