Putnam
Money
Market
Fund
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
3-31-99
[LOGO: BOSTON * LONDON * TOKYO]
From the Chairman
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[copyright] Karsh, Ottawa
Dear Shareholder:
The past six months have been a positive, though relatively volatile time
for U.S. financial markets. Investors grappled with recurring instability
in the emerging markets, an apparent stall in U.S. economic growth, three
short-term interest rate cuts by the Federal Reserve Board, and finally
the economy's resilient return to strength. Putnam Money Market Fund's
recent performance reflects this mixed environment. For the six months
ended March 31, 1999, the fund's class A shares returned 2.47% at net
asset value. You can find additional performance information on pages 5
and 6.
* DURATION ADJUSTMENTS KEEP PACE WITH INTEREST RATES
As the economic winds appeared to change during the period, the Fed also
shifted its monetary policy. When the economy seemed in danger of stalling
during the fall, the Fed stepped in to lower short-term interest rates
three times in just seven weeks. Once the economy's growth rate appeared
more secure, the Fed adopted a more neutral monetary stance. During the
first quarter of calender 1999, market participants actually saw some
potential for the Fed to raise rates, as inflation expectations rose,
commodity prices began to rise, wage growth stopped declining, and money
and credit continued to grow. These expectations were never realized, of
course, although Fed Chairman Alan Greenspan did give some spirited
anti-inflation rhetoric in his semiannual Humphrey-Hawkins testimony
before the Senate on February 23.
Successfully managing your fund over the semiannual period required
flexibility. Early in the fourth quarter of 1998, your fund's manager,
Joanne M. Driscoll, extended duration in order to lock in higher money
market yields. As the Fed began to lower interest rates, the fund's
extended duration helped maintain its income stream. Toward the end of the
year, Joanne brought the duration back to a more neutral position as it
became clear that the Fed's easing bias was over. This allowed the fund to
take advantage of a cyclical year-end increase in money market yields that
generally occurs in December, when businesses issue securities at higher
interest rates in order to fund operations over the year's end.
* QUALITY EMPHASIS, CONSERVATIVE STRATEGIES CONTINUE
With many international financial markets still experiencing difficulties
during the fall, investors continued to take comfort in the liquidity,
high quality, and relative stability of money market funds. Consequently,
conservative, superior quality money market funds such as yours continued
to experience record inflows of new capital over the period. Your fund has
always made capital preservation and credit quality top priorities,
investing in a wide spectrum of high-quality money market securities.
Early in the period, the fund manager bolstered quality even further by
increasing the portfolio's exposure to U.S. government agency securities,
which are among the highest quality investments available. At the same
time, she reduced the portfolio's holdings of corporate and bank
securities, which were unlikely to perform well in the prevailing
flight-to-quality environment. When calm returned to the money markets in
the first quarter of 1999, government securities holdings were reduced and
the fund's exposure to top quality, higher-yielding commercial paper
increased once again.
In the months ahead, Joanne will continue to pursue the conservative
strategies that have served shareholders well thus far. She will remain
watchful for opportunities to boost income while continuing to concentrate
on preserving net asset value and maintaining a superior quality
portfolio.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
May 19, 1999
The views expressed here are exclusively those of Putnam Management. They
are not meant as investment advice. Although the described holdings were
viewed favorably as of 3/31/99, there is no guarantee the fund will
continue to hold these securities in the future. An investment in the fund
is not insured or guaranteed by the Federal Deposit Insurance Corporation
or any other government agency. Although the fund seeks to preserve your
investment at $1.00 per share, it is possible to lose money by investing
in the fund.
PERFORMANCE COMPARISONS (3/31/99)
Current
return*
- -----------------------------------------------
Passbook savings account 1.50%
- -----------------------------------------------
Taxable money market fund 7-day yield 4.44
- -----------------------------------------------
3-month certificate of deposit 3.73
- -----------------------------------------------
Putnam Money Market Fund (7-day yield)
- -----------------------------------------------
Class A 4.66
- -----------------------------------------------
Class B 4.16
- -----------------------------------------------
Class C 4.51
- -----------------------------------------------
Class M 4.51
- -----------------------------------------------
The net asset value of money market mutual funds is uninsured and designed
to be fixed, while distributions vary daily. Investment returns will
fluctuate. The principal value on passbook savings and on bank CDs is
generally insured up to certain limits by state and federal agencies.
Unlike stocks, which incur more risk, CDs offer a fixed rate of return.
Unlike money market funds, bank CDs may be subject to substantial
penalties for early withdrawals.
* Sources: BankBoston (passbook savings), Bank Rate Monitor (3-month CDs),
IBC/Donaghue's Money Fund Report (taxable money market fund compound 7-day
yield).
Performance summary
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
Money Market Fund is designed for investors seeking current income
consistent with capital preservation, stable principal, and liquidity.
TOTAL RETURN FOR PERIODS ENDED 3/31/99
Class A Class B Class C Class M
(inception date) (10/1/76) (4/27/92) (2/1/99) (12/8/94)
NAV NAV CDSC NAV CDSC NAV
- ------------------------------------------------------------------------------
6 months 2.47% 2.24% -2.76% 2.29% 1.29% 2.41%
- ------------------------------------------------------------------------------
1 year 5.18 4.68 -0.32 4.74 3.74 5.04
- ------------------------------------------------------------------------------
5 years 28.11 24.94 22.94 25.01 25.01 27.16
Annual average 5.08 4.55 4.22 4.57 4.57 4.92
- ------------------------------------------------------------------------------
10 years 65.78 57.97 57.97 58.06 58.06 63.33
Annual average 5.18 4.68 4.68 4.68 4.68 5.03
- ------------------------------------------------------------------------------
Life of fund 392.54 340.82 340.82 341.08 341.08 376.26
Annual average 7.35 6.82 6.82 6.82 6.82 7.19
- ------------------------------------------------------------------------------
Current return (end of period)
- ------------------------------------------------------------------------------
Current 7-day yield1 4.66% 4.16% 4.16% 4.51% 4.51% 4.51%
- ------------------------------------------------------------------------------
Current 30-day yield1 4.68 4.18 4.18 4.53 4.53 4.53
- ------------------------------------------------------------------------------
1The 7-day and 30-day yields are the two most common gauges for measuring
money market mutual fund performance.
COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 3/31/99
Lipper Money Consumer
Market Average price index
- ------------------------------------------------------------------------------
6 months 2.20% 0.98%
- ------------------------------------------------------------------------------
1 year 4.70 1.73
- ------------------------------------------------------------------------------
5 years 26.76 12.09
Annual average 4.85 2.31
- ------------------------------------------------------------------------------
10 years 64.58 34.91
Annual average 5.11 3.04
- ------------------------------------------------------------------------------
Life of fund 395.77 186.46
Annual average 7.37 4.79
- ------------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. Returns shown for class B, class C
and class M shares for periods prior to their inception are derived from
the historical performance of class A shares, adjusted to reflect the
higher operating expenses applicable to such shares. Certain sales charges
may apply to class B, class C and class M shares upon redemption. See the
prospectus for complete details. All returns assume reinvestment of
distributions at NAV. Fund performance data do not take into account any
adjustment for taxes payable on reinvested distributions. Investment
returns will fluctuate.
DISTRIBUTION INFORMATION
6 months ended 3/31/99
Class A Class B Class C Class M
- ------------------------------------------------------------------------------
Distributions (number) 6 6 2 6
- ------------------------------------------------------------------------------
Income $0.024469 $0.022151 $0.007476 $0.023871
- ------------------------------------------------------------------------------
Total $0.024469 $0.022151 $0.007476 $0.023871
- ------------------------------------------------------------------------------
An investment in the fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the
fund seeks to preserve your investment at $1.00 per share, it is possible
to lose money by investing in the fund. The fund's holdings do not match
those in the Lipper average. Yield data more closely reflect the current
earnings of the fund.
TERMS AND DEFINITIONS
Total return shows how the value of the fund's shares changed over time,
assuming you held the shares through the entire period and reinvested all
distributions in the fund.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities, divided by the number of outstanding shares.
Class A shares generally are fund shares purchased with an initial sales
charge. In the case of your fund, which has no sales charge, the reference
is to shares purchased or acquired through the exchange of class A shares
from another Putnam fund. Exchange of your fund's class A shares into
another fund may involve a sales charge, however.
Class B and class C shares generally are fund shares purchased with no
initial sales charge but subject to a contingent deferred sales charge
(CDSC) upon redemption. However, class B and class C shares of your fund
can be acquired only through exchange of class B or class C shares from
another fund or purchased by certain systematic plan shareholders. A
contingent deferred sales charge is a charge applied at the time of
redemption of class B and class C shares and assumes redemption at the end
of the period. The CDSC schedule will vary depending on whether the shares
were acquired through exchange or through a systematic investment plan
purchase. Consult your prospectus for details.
Class M shares generally have a lower initial sales charge and a higher
12b-1 fee than class A shares and no sales charge on redemption. In the
case of your fund, which has no sales charge, exchange of your fund's
class M shares into another fund may involve a sales charge, however.
COMPARATIVE BENCHMARKS
Lipper Money Market Fund Average, used for performance comparison
purposes, is an arithmetic average of the total return of all money market
mutual funds tracked by Lipper Analytical Services. Lipper is an
independent rating organization for the mutual fund industry. Lipper
rankings vary for other periods. The fund's holdings do not match those in
the Lipper average. It is not possible to invest directly in an index.
Consumer price index (CPI) is a commonly used measure of inflation; it
does not represent an investment return.
<TABLE>
<CAPTION>
Portfolio of investments owned
March 31, 1999 (Unaudited)
COMMERCIAL PAPER (88.7%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
<S> <C> <C> <C> <C>
Domestic (57.8%)
- --------------------------------------------------------------------------------------------------------------------------
$22,060,000 AES Hawaii, Inc. (Bank of America (LOC)) 4.8s 4/9/99 $ 22,033,528
33,000,000 American General Finance Corp. 4.85s 5/11/99 32,817,721
32,000,000 American General Finance Corp. 4.84s 5/3/99 31,858,027
24,900,000 American General Finance Corp. 4.83s 4/30/99 24,799,778
35,000,000 American General Finance Corp. 4.83s 4/27/99 34,873,213
164,000,000 Associates Corp. Of North America 5.03s 4/1/99 163,977,085
30,000,000 Bank Of New York Co. 4.83s 4/16/99 29,935,600
45,000,000 BankAmerica Corp. 4.87s 5/6/99 44,780,850
27,000,000 BankAmerica Corp. 4.81s 11/3/99 26,217,172
35,000,000 Chase Manhattan Corp. 4.83s 9/22/99 34,178,229
30,000,000 Chevron Transport Corp. 4.95s 4/22/99 29,909,250
30,000,000 Chevron Transport Corp. 4.85s 5/7/99 29,850,458
25,000,000 Chevron Transport Corp. 4.83s 6/10/99 24,761,854
40,000,000 Corporate Receivables Corp. 4.85s 5/4/99 39,816,778
38,000,000 Corporate Receivables Corp. 4.84s 8/31/99 37,218,340
35,000,000 Corporate Receivables Corp. 4.84s 5/27/99 34,731,783
32,600,000 Corporate Receivables Corp. 4.83s 4/28/99 32,477,533
21,000,000 CXC Inc. 4.9s 6/4/99 20,814,208
28,000,000 CXC Inc. 4.86s 9/15/99 27,364,960
37,000,000 CXC Inc. 4.84s 4/21/99 36,895,537
40,000,000 CXC Inc. 4.84s 5/20/99 39,731,111
30,000,000 CXC Inc. 4.83s 4/19/99 29,923,525
25,000,000 Delaware Funding Corp. 4.89s 5/7/99 24,875,125
30,000,000 Eureka Securitization Inc. 4.84s 5/24/99 29,782,200
30,000,000 Eureka Securitization Inc. 4.82s 4/5/99 29,979,917
36,000,000 Falcon Asset Securitization Corp. 4 7/8s 4/20/99 35,902,500
32,205,000 Falcon Asset Securitization Corp. 4 7/8s 4/19/99 32,122,139
36,000,000 Falcon Asset Securitization Corp. 4.85s 6/17/99 35,621,700
30,000,000 Falcon Asset Securitization Corp. 4.85s 4/19/99 29,922,733
40,000,000 Ford Motor Credit Co. 4.83s 4/23/99 39,876,567
37,600,000 Ford Motor Credit Co. 4.81s 4/8/99 37,559,810
22,000,000 Formosa Plastics Corp.
(Bank of America (LOC)) 4.95s 6/29/99 21,727,750
42,000,000 General Electric Capital Corp. 4.95s 4/6/99 41,965,350
36,500,000 General Electric Capital Corp. 4.84s 5/12/99 36,293,897
40,000,000 General Electric Capital Corp. 4.83s 6/8/99 39,629,700
20,000,000 General Electric Capital Corp. 4.82s 5/26/99 19,850,044
30,000,000 General Electric Capital Corp. 4.81s 6/7/99 29,727,433
130,000,000 General Motors Acceptance Corp. 5.08s 4/1/99 129,981,655
30,000,000 Goldman Sachs 4.85s 8/17/99 29,438,208
35,000,000 Goldman Sachs 4.85s 7/14/99 34,504,896
22,000,000 Goldman Sachs 4.85s 5/26/99 21,834,022
19,200,000 IBM Credit Corp. 4.87s 4/14/99 19,163,637
30,000,000 IBM Credit Corp. 4.82s 4/13/99 29,947,783
25,000,000 International Business Machines Inc. 4.83s 4/30/99 24,899,375
35,000,000 Lehman Brothers Hldg. 5.08s 5/28/99 34,713,544
30,000,000 Lehman Brothers Hldg. 5.05s 5/17/99 29,802,208
20,000,000 Lehman Brothers Hldg. 4.97s 5/19/99 19,864,706
40,000,000 Metlife Funding. 4.85s 4/26/99 39,859,889
35,000,000 Morgan (J.P.) & Co., Inc. 5.546s 7/7/99 34,994,376
45,000,000 Morgan (J.P.) & Co., Inc. 4.85s 7/12/99 44,375,562
30,000,000 Morgan Stanley Dean Witter & Co. 4.9s 4/8/99 29,967,333
25,000,000 Morgan Stanley Dean Witter & Co. 4.88s 5/18/99 24,837,333
30,000,000 Morgan Stanley Dean Witter & Co. 4.87s 5/10/99 29,837,667
30,000,000 Morgan Stanley Dean Witter & Co. 4.84s 5/28/99 29,766,067
20,000,000 National Rural Utilities Co-operative
Finance Corp. 4.82s 6/25/99 19,769,711
25,000,000 PNC Funding Corp. 4.92s 5/27/99 24,805,250
30,000,000 PNC Funding Corp. 4.87s 6/10/99 29,711,858
21,755,000 Preferred Receivables Funding Corp. 5s 4/29/99 21,667,376
42,000,000 Preferred Receivables Funding Corp. 4.88s 5/5/99 41,800,733
24,840,000 Prudential Funding Corp. 5.05s 4/1/99 24,836,515
38,000,000 Sheffield Receivables Corp. 4.88s 4/12/99 37,938,187
35,000,000 Sheffield Receivables Corp. 4.87s 4/15/99 34,928,979
35,000,000 Sheffield Receivables Corp. 4.86s 4/16/99 34,924,400
30,000,000 Sheffield Receivables Corp. 4.83s 4/13/99 29,947,675
25,000,000 USAA Capital Corp. 4.83s 4/1/99 24,996,646
21,000,000 USAA Capital Corp. 4.82s 4/22/99 20,938,143
30,000,000 Wells Fargo & Co. 5.31s 3/31/00 29,988,477
30,000,000 Windmill Funding Corp. 4.9s 4/1/99 29,995,917
21,000,000 Windmill Funding Corp. 4.89s 5/14/99 20,874,490
22,000,000 Windmill Funding Corp. 4.85s 4/16/99 21,952,578
25,000,000 Windmill Funding Corp. 4.83s 4/15/99 24,949,583
36,774,000 Windmill Funding Corp. 4.83s 4/14/99 36,704,926
22,877,000 Windmill Funding Corp. 4 3/4s 9/27/99 22,333,671
--------------
2,454,656,781
Foreign (30.9%)
- --------------------------------------------------------------------------------------------------------------------------
40,000,000 Abbey National North America Corp. 4.88s
(United Kingdom) 4/6/99 39,967,467
38,000,000 Abbey National North America Corp. 4.823s
(United Kingdom) 7/2/99 37,526,542
29,000,000 Abbey National North America Corp. 4.74s
(United Kingdom) 10/29/99 28,190,513
42,000,000 Abbey National North America Corp. 4.735s
(United Kingdom) 4/21/99 41,883,993
25,000,000 Banco de Credito Nacional S.A. 5s
(Barclays (LOC)) (United Kingdom) 6/21/99 24,715,278
12,000,000 Banco de Credito Nacional S.A. 4.96s
(Barclays (LOC)) (United Kingdom) 5/7/99 11,938,827
26,000,000 Banco De Galicia Y Buenos Aires 4.87s
(Dresdner Bank (LOC)) (Germany) 5/20/99 25,824,139
30,000,000 Banco Nacional De Comerico Ext.
(Barclays (LOC)) 4 7/8s United Kingdom 4/12/99 29,951,250
29,000,000 Banco Nacional De Comerico Ext.
(Barclays (LOC)) 4.83s (United Kingdom) 5/6/99 28,859,930
29,000,000 Bancomer, S.A., Institution de Banca Multiple
(Bank Of Montreal (LOC)) 5.05s (Canada) 4/7/99 28,971,524
42,000,000 Bancomer, S.A., Institution de Banca Multiple
(Bank Of Montreal (LOC)) 4.95s (Canada) 6/16/99 41,555,325
25,000,000 Bancomer, S.A., Institution de Banca Multiple
(Bank Of Montreal (LOC)) 4.87s (Canada) 8/11/99 24,550,201
30,000,000 Bank Of Nova Scotia 4.88s (Canada) 5/25/99 29,776,333
16,000,000 Cemex S.A. (Credit Suisse First Boston (LOC))
5.05s (Switzerland) 4/9/99 15,979,800
25,000,000 China Merchants (Cayman), Inc. 4.89s (Switzerland) 5/13/99 24,853,979
21,500,000 CBA Delaware Finance 4.84s (Australia) 5/21/99 21,352,582
35,000,000 CBA Delaware Finance 4.83s (Australia) 6/21/99 34,614,942
35,000,000 Contifinancial Corp. (Dresdner Bank AG (LOC))
5.15s (Germany) 4/29/99 34,854,799
17,500,000 Contifinancial Corp. (Dresdner Bank AG (LOC))
5s (Germany) 4/28/99 17,431,944
23,000,000 Contifinancial Corp. (Dresdner Bank AG (LOC))
4.85s (Germany) 6/22/99 22,742,815
36,000,000 Corporacion Andina de Fomento (Barclays (LOC))
4.85s (United Kingdom) 4/26/99 35,873,900
25,000,000 Credit Suisse First Boston 4.81s (Switzerland) 5/10/99 24,866,389
30,000,000 Credit Suisse First Boston 4.81s (Switzerland) 5/5/99 29,859,708
30,000,000 DaimlerChrysler NA Holding Corp. 4.88s
(Germany) 6/8/99 29,719,400
30,000,000 DaimlerChrysler NA Holding Corp. 4.88s
(Germany) 5/19/99 29,800,733
35,000,000 DaimlerChrysler NA Holding Corp. 4.86s
(Germany) 5/11/99 34,806,275
20,000,000 DaimlerChrysler NA Holding Corp. 4.84s
(Germany) 5/21/99 19,862,867
42,000,000 DaimlerChrysler NA Holding Corp. 4.81s
(Germany) 4/14/99 41,921,437
43,000,000 Demir Funding Corp. (Bayerische Hypo-und
Vereinsbank (LOC)) 4.86s (Germany) 4/12/99 42,930,340
42,000,000 Den Danske Corp. Inc. 4.87s (Denmark) 4/7/99 41,960,228
20,191,000 Den Danske Corp. Inc. 4.85s (Denmark) 5/4/99 20,098,514
34,000,000 Den Danske Corp. Inc. 4.845s (Denmark) 6/17/99 33,643,085
31,000,000 Diageo Capital PLC 4.87s (United Kingdom) 4/7/99 30,970,645
25,000,000 Formosa Plastics Corp. (ABN AMRO
Bank N. V. (LOC)) 4.95s (Netherlands) 6/14/99 24,742,188
20,000,000 Formosa Plastics Corp. (ABN AMRO
Bank N. V. (LOC)) 4.86s (Netherlands) 5/13/99 19,883,900
25,000,000 Garanti Funding Corp. (Bayerische Hypo-und
Vereinsbank (LOC)) 4.8s (Germany) 8/2/99 24,586,667
16,000,000 Girsa Funding Corp. (Societe Generale (LOC))
4.8s (France) 7/26/99 15,750,400
50,000,000 Girsa Funding Corp. (Societe Generale (LOC))
4.78s (France) 7/26/99 49,223,250
26,000,000 Glencore Finance Ltd. (ABN AMRO
Bank N. V. (LOC)) 4.9s (Netherlands) 4/9/99 25,968,150
18,000,000 Nacional Financiera, S.N.C. (Barclays Bank
PLC (LOC)) 4.87s (United Kingdom) 11/12/99 17,449,690
30,000,000 Toronto Dominion Holdings 4.77s (Canada) 11/5/99 29,129,475
20,000,000 Transportation de Gas del Sur S.A. (Dresdner
Bank AG (LOC)) 4.86s (Germany) 6/23/99 19,773,200
41,949,000 UBS AG 4.86s (Switzerland) 6/11/99 41,541,256
25,000,000 UBS AF 4.79s (Switzerland) 10/12/99 24,351,354
40,000,000 Westpac Banking Corp. 4.82s (Australia) 7/6/99 39,480,511
--------------
1,313,735,745
--------------
Total Commercial Paper (cost $3,768,392,526) $3,768,392,526
CERTIFICATES OF DEPOSIT (6.2%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
- --------------------------------------------------------------------------------------------------------------------------
$53,000,000 Bayerische Landesbank Girozentrate
5.115s (Germany) 3/21/00 $ 52,909,397
35,000,000 Canadian Imperial Bank Of Commerce
5.12s (Canada) 2/23/00 34,984,804
30,000,000 Commerzbank AG 5.09s (Germany) 2/16/00 29,992,347
35,000,000 Deutsche Bank 5.07s (Germany) 1/13/00 34,992,013
30,000,000 Deutsche Bank 5.06s (Germany) 2/8/00 29,990,048
31,000,000 Fleet National Bank 4.87s 4/20/99 31,000,000
27,000,000 Rabobank Nederland 5.71s (Netherlands) 5/21/99 26,996,715
21,000,000 Societe Generale 5.785s (France) 5/12/99 20,999,154
--------------
Total Certificates of Deposit (cost $261,864,478) $ 261,864,478
U. S. GOVERNMENT & AGENCY OBLIGATIONS (1.5%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
- --------------------------------------------------------------------------------------------------------------------------
$35,000,000 Federal Home Loan Mortgage Corp. 4.81s 6/24/99 $ 34,602,508
30,000,000 Federal Home Loan Mortgage Corp. 4.81s 6/15/99 29,696,633
--------------
Total U.S. Government & Agency Obligations
(cost $64,299,141) $ 64,299,141
BANK NOTES (1.6%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
- --------------------------------------------------------------------------------------------------------------------------
$40,000,000 Nationsbank NA 4.96s 6/9/99 $ 40,000,000
30,000,000 Fleet National Bank 4.88s 7/30/99 30,000,000
--------------
Total Bank Notes (cost $70,000,000) $ 70,000,000
- --------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $4,164,556,145) (b) $4,164,556,145
- --------------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $4,250,800,934
(b) The aggregate identified cost on a tax basis is the same.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of assets and liabilities
March 31, 1999 (Unaudited)
<S> <C>
Assets
- -----------------------------------------------------------------------------------------------
Investments in securities, at amortized cost (Note 1) $4,164,556,145
- -----------------------------------------------------------------------------------------------
Cash 4,333
- -----------------------------------------------------------------------------------------------
Interest and other receivables 9,261,422
- -----------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 111,286,259
- -----------------------------------------------------------------------------------------------
Total assets 4,285,108,159
Liabilities
- -----------------------------------------------------------------------------------------------
Distributions payable to shareholders 658,642
- -----------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 29,424,230
- -----------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 3,059,807
- -----------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 415,199
- -----------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 28,031
- -----------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 7,482
- -----------------------------------------------------------------------------------------------
Payable for distribution fees (Note 2) 389,430
- -----------------------------------------------------------------------------------------------
Other accrued expenses 324,404
- -----------------------------------------------------------------------------------------------
Total liabilities 34,307,225
- -----------------------------------------------------------------------------------------------
Net assets $4,250,800,934
Represented by
- -----------------------------------------------------------------------------------------------
Paid-in capital (Note 4) $4,250,800,934
- -----------------------------------------------------------------------------------------------
Net asset value, offering and redemption price per class
A share ($3,292,062,798 divided by 3,292,062,798 shares)* $1.00
- -----------------------------------------------------------------------------------------------
Net asset value and offering price per class B share
($847,125,248 divided by 847,125,248 shares)** $1.00
- -----------------------------------------------------------------------------------------------
Net asset value and offering price per class C share
($1,262,994 divided by 1,262,994 shares)** $1.00
- -----------------------------------------------------------------------------------------------
Net asset value, offering and redemption price per class M share
($110,349,894 divided by 110,349,894 shares)* $1.00
- -----------------------------------------------------------------------------------------------
* Offered at net asset value.
** Class B and class C shares are available only by exchange of class B and class C
shares from other Putnam funds and to certain systematic investment plan investors. For
investors who acquired class B and class C shares through an exchange, the applicable
contingent deferred sales charge will depend upon the fund which you exchanged.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of operations
Six months ended March 31, 1999 (Unaudited)
Interest income $99,626,343
- -----------------------------------------------------------------------------------------------
<S> <C>
Expenses:
- -----------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 5,909,290
- -----------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 2,430,319
- -----------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 20,895
- -----------------------------------------------------------------------------------------------
Administrative services (Note 2) 15,242
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 1,917,203
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class C (Note 2) 363
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class M (Note 2) 70,190
- -----------------------------------------------------------------------------------------------
Reports to shareholders 59,662
- -----------------------------------------------------------------------------------------------
Registration fees 460,780
- -----------------------------------------------------------------------------------------------
Auditing 8,409
- -----------------------------------------------------------------------------------------------
Legal 12,959
- -----------------------------------------------------------------------------------------------
Postage 239,123
- -----------------------------------------------------------------------------------------------
Other 34,492
- -----------------------------------------------------------------------------------------------
Total expenses 11,178,927
- -----------------------------------------------------------------------------------------------
Expense reduction (Note 2) (378,705)
- -----------------------------------------------------------------------------------------------
Net expenses 10,800,222
- -----------------------------------------------------------------------------------------------
Net investment income 88,826,121
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $88,826,121
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of changes in net assets
Six months ended Year ended
March 31 September 30
1999* 1998
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
Increase in net assets
- ---------------------------------------------------------------------------------------------------------------
Operations:
- ---------------------------------------------------------------------------------------------------------------
Net investment income $ 88,826,121 $ 139,881,316
- ---------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 88,826,121 139,881,316
- ---------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income
Class A (69,743,911) (113,849,258)
- ---------------------------------------------------------------------------------------------------------------
Class B (16,894,972) (22,607,932)
- ---------------------------------------------------------------------------------------------------------------
Class C (1,864) --
- ---------------------------------------------------------------------------------------------------------------
Class M (2,185,374) (3,424,126)
- ---------------------------------------------------------------------------------------------------------------
Increase from capital share transactions (Note 4) 797,328,488 849,862,355
- ---------------------------------------------------------------------------------------------------------------
Total increase in net assets 797,328,488 849,862,355
Net assets
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 3,453,472,446 2,603,610,091
- ---------------------------------------------------------------------------------------------------------------
End of period $4,250,800,934 $3,453,472,446
- ---------------------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS A
- -----------------------------------------------------------------------------------------------------------------------------------
Six months
ended For the eleven
Per-share March 31 months ended
operating performance (Unaudited) Year ended September 30 Sept. 30++
- -----------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income $.0245 $.0517 $.0505 $.0507 $.0521 $.0299
- -----------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations .0245 .0517 .0505 .0507 .0521 .0299
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions $(.0245) $(.0517) $(.0505) $(.0507) $(.0521) $(.0299)
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- -----------------------------------------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 2.47* 5.29 5.17 5.19 5.33 3.03*
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $3,292,063 $2,598,891 $2,134,223 $1,659,288 $1,189,640 $1,101,171
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .24* .58 .57 .57 .62 .58*
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 2.42* 5.20 5.06 5.00 5.23 3.03*
- -----------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
++ The fiscal year end has advanced from October 31 to September 30.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) The ratio of expenses to average net assets for the period ended September 30, 1995 and thereafter,
includes amounts paid through expense offset arrangements. Prior period ratios exclude
these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS B
- -----------------------------------------------------------------------------------------------------------------------------------
Six months
ended For the eleven
Per-share March 31 months ended
operating performance (Unaudited) Year ended September 30 Sept. 30++
- -----------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income $0.0222 $.0468 $.0455 $.0457 $.0469 $.0251
- -----------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations .0222 .0468 .0455 .0457 .0469 .0251
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions $(.0222) $(.0468) $(.0455) $(.0457) $(.0469) $(.0251)
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- -----------------------------------------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 2.24* 4.78 4.65 4.67 4.80 2.54*
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $847,125 $759,748 $410,885 $438,316 $256,533 $194,187
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .49* 1.08 1.07 1.07 1.12 1.03*
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 2.17* 4.69 4.57 4.51 4.75 2.77*
- -----------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
++ The fiscal year end has advanced from October 31 to September 30.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) The ratio of expenses to average net assets for the period ended September 30, 1995 and thereafter,
includes amounts paid through expense offset arrangements. Prior period ratios exclude
these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS C
- -----------------------------------------------------------------------------------------------------------------------------------
For the period
Per-share February 1, 1999
operating performance to March 31+
- -----------------------------------------------------------------------------------------------------------------------------------
1999
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Net investment income $.0075
- -----------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations .0075
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions $(.0075)
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- -----------------------------------------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) .75*
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $1,263
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .16*
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) .77*
- -----------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
++ The fiscal year end has advanced from October 31 to September 30.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) The ratio of expenses to average net assets for the period ended September 30, 1995 and thereafter,
includes amounts paid through expense offset arrangements. Prior period ratios exclude
these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS M
- -----------------------------------------------------------------------------------------------------------------------------------
Six months
ended For the period
Per-share March 31 Dec. 8, 1994+
operating performance (Unaudited) Year ended September 30 to Sept. 30
- -----------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net investment income $.0239 $.0502 $.0490 $.0490 $.0434
- -----------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations .0239 .0502 .0490 .0490 .0434
- -----------------------------------------------------------------------------------------------------------------------------------
Total distributions $(.0239) $(.0502) $(.0490) $(.0490) $(.0434)
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- -----------------------------------------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 2.41* 5.14 5.01 5.02 4.43*
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $110,350 $94,833 $58,502 $29,075 $8,440
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .32* .73 .72 .72 .67*
- -----------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 2.34* 5.04 4.92 4.82 4.29*
- -----------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
++ The fiscal year end has advanced from October 31 to September 30.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) The ratio of expenses to average net assets for the period ended September 30, 1995 and thereafter,
includes amounts paid through expense offset arrangements. Prior period ratios exclude
these amounts (Note 2).
</TABLE>
Notes to financial statements
March 31, 1999 (Unaudited)
Note 1
Significant accounting policies
Putnam Money Market Fund (the "fund"), is registered under the Investment
Company Act of 1940, as amended as a diversified, open-end management
investment company. The fund seeks as high a rate of current income as
Putnam Investment Management, Inc. ("Putnam Management") believes is
consistent with preservation of capital and maintenance of liquidity. The
fund achieves its objective by primarily investing in a portfolio of
high-grade short-term obligations. The fund may invest up to 100% of its
assets in the banking industry and in commercial paper and short-term
corporate obligations of issuers in the personal credit institution and
business credit industries.
The fund offers class A, class B, class C, and class M shares. The fund
began offering class C shares on February 1, 1999. Each class of shares is
sold without a front-end sales charge. Class B and class C shares are
offered only in exchange for class B and class C shares of other Putnam
funds, or purchased by certain systemic investments plans. Shareholders
who acquired class B and class C shares through an exchange are subject to
the same contingent deferred sales charge schedule as the fund from which
they were exchanged. Class B shares, which convert to class A shares after
approximately eight years, pay an ongoing distribution fee, and are
subject to a contingent deferred sales charge, if those shares are
redeemed within six years of purchase (including any holding period of the
shares in other Putnam funds). Class C shares are subject to the same fees
and expenses as class B shares, except that class C shares have a one-year
1.00% contingent deferred sales charge and do not convert to class A
shares. Class M shares pay an ongoing distribution fee lower than class B
and class C shares but are not subject to a contingent deferred sales
charge.
Expenses of the fund are borne pro-rata by the holders of each class of
shares, except that each class bears expenses unique to that class
(including the distribution fees applicable to such class). Each class
votes as a class only with respect to its own distribution plan or other
matters on which a class vote is required by law or determined by the
Trustees. Shares of each class would receive their pro-rata share of the
net assets of the fund, if that fund were liquidated. In addition, the
Trustees declare separate dividends on each class of shares.
The following is a summary of significant accounting policies consistently
followed by the fund in the preparation of its financial statements. The
preparation of financial statements is in conformity with generally
accepted accounting principles and requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities. Actual results could differ from those estimates.
A) Security valuation The valuation of the fund's portfolio instruments is
determined by means of the amortized cost method as set forth in Rule 2a-7
under the Investment Company Act of 1940. The amortized cost of an
instrument is determined by valuing it at cost originally and thereafter
amortizing any discount or premium from its face value at a constant rate
until maturity.
B) Joint trading account Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the fund may transfer uninvested cash
balances into a joint trading account along with the cash of other
registered investment companies and certain other accounts managed by
Putnam Management, the fund's Manager, a wholly-owned subsidiary of Putnam
Investments, Inc. These balances may be invested in one or more repurchase
agreements and/or short-term money market instruments.
C) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed).
D) Federal taxes It is the policy of the fund to distribute all of its
taxable income within the prescribed time and otherwise comply with the
provisions of the Internal Revenue Code applicable to regulated investment
companies. It is also the intention of the fund to distribute an amount
sufficient to avoid imposition of any excise tax under Section 4982 of the
Internal Revenue Code of 1986, as amended. Therefore, no provision has
been made for federal taxes on income, capital gains or unrealized
appreciation on securities held nor for excise tax on income and capital
gains.
E) Interest income and distributions to shareholders Interest is recorded
on the accrual basis. Income dividends (and distributions of realized
gains, if any) are recorded daily by the fund and are distributed monthly
to the shareholders.
F) Amortization of bond premium and accretion of bond discount Premiums
and discounts from purchases of short-term investments are
amortized/accreted using the straight-line method.
Note 2
Management fee, administrative
services and other transactions
Compensation of Putnam Management, for management and investment advisory
services is paid quarterly based on the average net assets of the fund.
Such fee is based on the following annual rates: 0.50% of the first $100
million of average net assets, 0.40% of the next $100 million, 0.35% of
the next $300 million, 0.325% of the next $500 million, and 0.30%
thereafter.
The fund reimburses Putnam Management an allocated amount for the
compensation and related expenses of certain officers of the fund and
their staff who provide administrative services to the fund. The aggregate
amount of all such reimbursements is determined annually by the Trustees.
Custodial functions for the fund's assets are provided by Putnam Fiduciary
Trust Company (PFTC), a subsidiary of Putnam Investments, Inc. Investor
servicing agent functions are provided by Putnam Investor Services, a
division of PFTC.
For the six months ended March 31, 1999, fund expenses were reduced by
$378,705 under expense offset arrangements with PFTC. Investor servicing
and custodian fees reported in the Statement of operations exclude these
credits. The fund could have invested a portion of the assets utilized in
connection with the expense offset arrangements in an income producing
asset if it had not entered into such arrangements.
Each Trustee of the fund receives an annual Trustee fee, of which $2,000
has been allocated to the fund, and an additional fee for each Trustee's
meeting attended. Trustees who are not interested persons of Putnam
Management and who serve on committees of the Trustees receive additional
fees for attendance at certain committee meetings.
The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan")
which allows the Trustees to defer the receipt of all or a portion of
Trustees Fees payable on or after July 1, 1995. The deferred fees remain
in the fund and are invested in certain Putnam funds until distribution in
accordance with the Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension
plan (the "Pension Plan") covering all Trustees of the fund who have
served as Trustee for at least five years. Benefits under the Pension Plan
are equal to 50% of the Trustee's average total retainer and meeting fees
for the three years preceding retirement. Pension expense for the fund is
included in Compensation of Trustees in the Statement of operations.
Accrued pension liability is included in Payable for compensation of
Trustees in the Statement of assets and liabilities.
The fund has adopted distribution plans (the "Plans") with respect to its
class B, class C and class M shares pursuant to Rule 12b-1 under the
Investment Company Act of 1940. The purpose of the Plans is to compensate
Putnam Mutual Funds Corp., a wholly-owned subsidiary of Putnam Investments
Inc., for services provided and expenses incurred by it in distributing
shares of the fund. The Plans provide for payments by the fund to Putnam
Mutual Funds Corp. at an annual rate up to 0.75%, 0.75%, and 1.00% of the
average net assets attributable to class B, class C and class M shares,
respectively. The Trustees have approved payment by the fund at an annual
rate of 0.50%, 0.50% and 0.15% of the average net assets attributable to
class A, class B, class C and class M shares respectively.
For the six months ended March 31, 1999, Putnam Mutual Funds Corp., acting
as underwriter received $2,940,600 and $0 in contingent deferred sales
charges from redemptions of class B and class C shares, respectively. A
deferred sales charge of up to 1% is assessed on certain redemptions of
class A shares. For the six months ended March 31, 1999, Putnam Mutual
Funds Corp., acting as the underwriter received no monies in contingent
deferred sales charges from redemptions of class A shares acquired through
an exchange from another fund. For the six months ended March 31, 1999,
Putnam Mutual Funds Corp., acting as underwriter received no monies on
class A redemptions.
Note 3
Purchases and sales of securities
During the six months ended March 31, 1999, purchases and sales (including
maturities) of investment securities (all short-term obligations)
aggregated $33,882,030,373 and $33,267,809,000, respectively. In
determining the net gain or loss on securities sold, the cost of
securities has been determined on the identified cost basis.
Note 4
Capital shares
At March 31, 1999, there was an unlimited number of shares of beneficial
interest authorized. Transactions in capital shares at a constant net
asset value of $1.00 per share were as follows:
Six months ended Year ended
March 31 September 30
Class A 1999 1998
- -----------------------------------------------------------------------------
Shares sold 4,412,143,243 6,667,169,273
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 68,038,226 108,688,157
- -----------------------------------------------------------------------------
4,480,181,469 6,775,857,430
Shares
repurchased (3,787,009,829) (6,311,189,399)
- -----------------------------------------------------------------------------
Net increase 693,171,640 464,668,031
- -----------------------------------------------------------------------------
Six months ended Year ended
March 31 September 30
Class B 1999 1998
- -----------------------------------------------------------------------------
Shares sold 1,344,152,854 2,232,701,520
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 15,705,680 20,739,502
- -----------------------------------------------------------------------------
1,359,858,534 2,253,441,022
Shares
repurchased (1,272,481,781) (1,904,577,891)
- -----------------------------------------------------------------------------
Net increase 87,376,753 348,863,131
- -----------------------------------------------------------------------------
For the period
February 1, 1999
(commencement
of operations) to
March 31
Class C 1999
- -----------------------------------------------------------------------------
Shares sold 1,576,349
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 1,864
- -----------------------------------------------------------------------------
1,578,213
Shares
repurchased (315,219)
- -----------------------------------------------------------------------------
Net increase 1,262,994
- -----------------------------------------------------------------------------
Six months ended Year ended
March 31 September 30
Class M 1999 1998
- -----------------------------------------------------------------------------
Shares sold 317,836,722 361,506,694
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 2,157,295 3,282,134
- -----------------------------------------------------------------------------
319,994,017 364,788,828
Shares
repurchased (304,476,916) (328,457,635)
- -----------------------------------------------------------------------------
Net increase 15,517,101 36,331,193
- -----------------------------------------------------------------------------
Fund information
INVESTMENT MANAGER
Putnam Investment
Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
TRUSTEES
George Putnam, Chairman
William F. Pounds, Vice Chairman
John A. Hill, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
Lawrence J. Lasser
John H. Mullin III
Robert E. Patterson
Donald S. Perkins
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
John D. Hughes
Senior Vice President and Treasurer
Lawrence J. Lasser
Vice President
Gordon H. Silver
Vice President
Ian C. Ferguson
Vice President
Brett C. Browchuk
Vice President
Stephen Oristaglio
Vice President
Edward H. D'Alelio
Vice President
Joanne Driscoll
Vice President and Fund Manager
Richard A. Monaghan
Vice President
John R. Verani
Vice President
Beverly Marcus
Clerk and Assistant Treasurer
This report is for the information of shareholders of Putnam Money Market
Fund. It may also be used as sales literature when preceded or accompanied
by the current prospectus, which gives details of sales charges,
investment objectives, and operating policies of the fund, and the most
recent copy of Putnam's Quarterly Performance Summary. For more
information or to request a prospectus, call toll free: 1-800-225-1581.
You can also learn more at Putnam Investments' Web site:
http://www.putnaminv.com.
Shares of mutual funds are not deposits or obligations of, or guaranteed
or endorsed by, any financial institution; are not insured by the Federal
Deposit Insurance Corporation (FDIC), the Federal Reserve Board, or any
other agency; and involve risk, including the possible loss of the
principal amount invested.
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
www.putnaminv.com
- ---------------------
BULK RATE
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
- ---------------------
SA039 51856 010/879/543 5/99
