Or, now we could ask why VMFXX yield is so high? VUSXX yield can now be pretty much explained by Treasury yields--it's just that it took a rapid decline in yield to get back to that being the case since before the OP date. As of today, VUSXX yield still is only 2 bps below the Tbill average I calculate as being relevant.Leif wrote: ↑Fri Jul 12, 2019 2:37 pmThats right. It just is surprising to me how rapid VUSXX has dropped relative to VMFXX. That is why I'm asking why is the Vanguard Treasury Money Market yield is so low.Kevin M wrote: ↑Fri Jul 12, 2019 1:04 pmThe title of this thread was accurate at the time of the OP, as it had nothing to do with state tax exemption, but simply the raw SEC yield of VUSXX compared to the 1m, 2m, and 3m Treasury yields. The yield no longer is high relative to the Tbills, so the title does not apply at this moment.
So why is VMFXX yield so high?
If I knew for certain that the percent of income from USGO would be at least as high as last year, I probably would move everything from VUSXX to VMFXX--it only takes a minute or so to do. Maybe the fund managers are keeping VMFXX yield relatively high by moving into more non-USGO securities, which would lower the TEY for those of us who pay state income tax.
Oh, and for those who wouldn't have $50K to get back into VUSXX but are in it now, just leave a few dollars in it, and it will stay open. At least that's the way it's been for me for all VG MM funds over the years, including VUSXX in the last year or so.