Cash is king. For once, that’s not just a tired cliché to describe risk aversion.

As discussed in these pages on too many occasions to count this year, there’s no obvious reason why anyone without a mandate stipulating otherwise shouldn’t be in T-Bills. Well, unless you count the prospect of delayed payments associated with a hypothetical, technical US default, but that’s another story.

USD cash proxies are yielding 5% (or more, if you’re willing to assume the stress around Treasury’s so-called “x-date”) and those assets carry no credit risk and no duration risk either.

Over the last week, the largest ETF inflows went to cash products, and according to EPFR’s data, more than $68 billion flowed into global cash funds over the latest weekly reporting period.

Notably, ICI’s data showed an even larger inflow, at $73.38 billion. $55.7 billion of that went to government funds.

The inflows came as stocks notched a third weekly loss, a streak US equities were trying desperately to break Friday.

February was a bad month for assets of all sorts. Bonds were caught in a dramatic hawkish repricing of Fed expectations, IG credit had its worst February in half a century and equities stumbled after a rollicking start to 2023.

Tales of 5% cash yields are now a fixture across financial media outlets, and the allure surely isn’t lost on money managers with the leeway to enjoy the sidelines. As BofA’s Michael Hartnett put it, “cash is as good as bonds and stocks” currently.