Putnam
Money Market
Fund
ANNUAL REPORT ON PERFORMANCE AND OUTLOOK
9-30-00
[SCALE LOGO OMITTED]
FROM THE TRUSTEES
[GRAPHIC OMITTED: PHOTO OF JOHN A. HILL AND GEORGE PUTNAM III]
Dear Shareholder:
It is a pleasure to greet you in our new roles as Chairman of the
Trustees and President of the Funds. As you know, both of us have been
members of the Board of Trustees for a number of years -- years during
which the global securities markets, the mutual fund industry, and
Putnam itself have experienced tremendous growth and change.
As we look to the future, we are certain that the changes will be
breathtaking in their scope. What will not change is the Trustees'
dedication to serving the best interests of our shareholders.
We welcome the challenges that lie ahead and are confident that Putnam
and your Board will continue to face those challenges successfully as
they have for more than 60 years. We look forward to helping you meet
your financial objectives for many years to come.
Respectfully yours,
/S/ JOHN A. HILL /S/ GEORGE PUTNAM, III
John A. Hill George Putnam, III
Chairman of the Trustees President of the Funds
November 15, 2000
REPORT FROM FUND MANAGEMENT
Joanne M. Driscoll
For most of the 12 months ended September 30, 2000, the money market
sustained positive momentum. The economy stayed strong, inflation
remained subdued, and interest rates trended upward. Among other U.S.
financial markets, the stock market experienced growing volatility amid
uneven corporate earnings reports, while the bond market generally
declined in response to rising interest rates. The money market also
experienced some volatility as nervous investors moved assets in and out
of money market funds in sync with stock market swings. Overall the
environment for money market funds was favorable, and your fund's recent
performance reflects this state of affairs.
Total return for 12 months ended 9/30/00
Class A Class B Class C Class M
NAV NAV CDSC NAV CDSC NAV
-----------------------------------------------------------------------
5.79% 5.25% 0.25% 5.26% 4.26% 5.65%
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Past performance is no indication of future results. Performance
information for longer periods and explanation of performance
calculation methods begin on page 5.
* ECONOMIC STRENGTH BEGINS TO WANE
The annual period began with the U.S. economic engine in full gear.
Plentiful jobs, rising incomes, tame inflation, and stock market gains
put consumers in a buying mood. Indeed one key indicator of the
economy's positive momentum has been home sales, which have remained
strong over the past six months. In August, sales of existing homes (as
opposed to newly constructed properties) rose 9.3%. This was the largest
gain since June 1999, when the rise in sales of existing homes reached
10.9%. It surprised many analysts, who had expected a rise closer to 4%.
As the third quarter progressed, however, clearer evidence of an
economic slowdown began to emerge. A punishing string of corporate
earnings warnings relentlessly pushed down stock prices, especially
among the much-watched high-flying technology stocks. Rising oil prices
also began to concern investors, analysts, and consumers, and President
Clinton took the unusual step of releasing oil from the nation's
petroleum reserves to help reduce oil prices. However, just after the
period closed, government unemployment figures fell to their lowest
level in almost 30 years, shedding more doubt on the economy's current
direction.
* MONEY MARKET YIELDS REFLECT FED'S RATE INCREASES
Yields on money market securities remained attractive over the period,
especially relative to yields on longer-term bonds. Over the 12-month
period, the Federal Reserve Board, concerned that the strong economy
would bring about a rise in inflation, raised its federal funds rate
(the interest rate charged by banks when they lend money to each other)
six times by a total of one and a half percentage points. At the same
time the Fed was raising short-term rates, the federal government had
initiated a buyback program for 30-year Treasury bonds. The buyback
program, combined with the Fed's tightening cycle, caused an inverted
yield curve from January 2000 through the end of the annual period. This
means that yields on short-term money market securities rose above
those available on longer-term bonds.
The Fed's tightening cycle appears to be ending and in fact no changes
have been made since May. Several reasons account for this shift in
policy. First, the economy appears to be slowing, which is what the Fed
intended. Second, the euro has been extremely weak against the dollar,
and if the Fed was to raise interest rates further, the euro's weakness
could be exacerbated. Third, oil prices are rising, creating another
potential drag on the economy. Finally, with the presidential election
approaching, the Fed may be reluctant to act for fear of appearing
biased toward either candidate.
Demand for money market securities continued to grow substantially over
the period. According to industry figures, money market assets grew by
17% over the 12 months ended September 30, 2000. This growth occurred
unevenly over the period, however, as investors moved assets in and out
of money market funds in step with stock market volatility.
Nevertheless, higher money market yields are among the reasons for the
overall increase, along with the attractive relative stability offered
by many money market instruments.
Supply has also been growing. Over the period, more corporations sought
short-term financing through the money market rather than by issuing
longer-term bonds or accessing funds through a bank line of credit,
which tends to be more expensive than issuing short-term debt. New
supply has not kept pace with demand, however, and this disparity has
created a favorable environment for investors in money market funds.
* SLIGHTLY LONGER DURATION, HIGH-QUALITY FOCUS POSITION FUND WELL
As interest rates continued to rise, we used duration -- a measure of
interest-rate sensitivity -- as a tool for managing the fund. For most
of the past six months, we kept duration slightly longer than the
market. Besides allowing the fund to lock in higher rates and capture
additional income, this longer duration also enabled the fund to avoid
reinvestment when money market yields started to decline toward the
period's end. We also kept the portfolio's maturities barbelled or
concentrated in the short and long ends of the money market maturity
range. This kept the fund flexible enough to handle volatile asset flows
while positioning it to take advantage of an anticipated additional Fed
intervention and the resulting higher interest rates.
Over the period, we continued to seek higher income by maintaining the
fund's allocation to floating-rate money market instruments. Yields on
these securities are pegged to standard money market indexes that
reflect the most current money market rates. Because the yields are
reset frequently, investing in these securities allows the fund to
capture extra income when rates are rising, as was the case throughout
most of the period.
Superior quality and preservation of capital remain the hallmarks of
your fund's portfolio strategy, and we continue to invest in a wide
spectrum of top quality traditional money market securities. As always,
our strict quality standards remained intact throughout the annual
period. In selecting investments for the portfolio, we seek holdings
that are rated by two or more nationally recognized rating services and
receive at least two ratings within the top two categories. If the
security has been rated by only one service, its rating must be within
the service's top two categories. At period's end, all portfolio
holdings met the aforementioned ratings criteria.
The final months of the year are traditionally a time of increased
supply of money market securities. Corporations typically issue more
short-term debt during the fourth quarter to fund their operations
through the end of the year. While maintaining our stringent credit
standards, we will seek opportunities to extend portfolio duration
marginally as any higher-yielding securities become available.
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 9/30/00, 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 (9/30/00)
Current
return*
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Passbook savings account 2.96%
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Taxable money market fund 7-day yield 6.00
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3-month certificate of deposit 4.55
-------------------------------------------------------------------
Putnam Money Market Fund (7-day yield)
-------------------------------------------------------------------
Class A 6.24
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Class B 5.73
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Class C 5.71
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Class M 6.08
-------------------------------------------------------------------
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: Fleet National Bank (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.
<TABLE>
<CAPTION>
TOTAL RETURN FOR PERIODS ENDED 9/30/00
Class A Class B Class C Class M
(inception dates) (10/1/76) (4/27/92) (2/1/99) (12/8/94)
NAV NAV CDSC NAV CDSC NAV
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 year 5.79% 5.25% 0.25% 5.26% 4.26% 5.65%
---------------------------------------------------------------------------------------------
5 years 29.26 26.07 24.07 26.17 26.17 28.30
Annual average 5.27 4.74 4.41 4.76 4.76 5.11
---------------------------------------------------------------------------------------------
10 years 59.16 51.66 51.66 51.77 51.77 56.83
Annual average 4.76 4.25 4.25 4.26 4.26 4.60
---------------------------------------------------------------------------------------------
Annual average
(life of fund) 7.22 6.70 6.70 6.70 6.70 7.06
---------------------------------------------------------------------------------------------
Current return (end of period)
---------------------------------------------------------------------------------------------
Current 7-day yield1 6.24% 5.73% 5.71% 6.08%
---------------------------------------------------------------------------------------------
Current 30-day yield1 6.21 5.69 5.72 6.12
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1 The 7-day and 30-day yields are the two most common gauges for measuring money market mutual
fund performance.
</TABLE>
COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 9/30/00
Lipper Money Consumer
Market Average price index
--------------------------------------------------------------------
1 year 5.43% 3.46%
--------------------------------------------------------------------
5 years 27.37 13.32
Annual average 4.96 2.53
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10 years 57.60 30.82
Annual average 4.65 2.72
--------------------------------------------------------------------
Annual average
(life of fund) 7.26 4.70
--------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. Returns shown for class B 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. One-, five- and ten-year
(when available), and life of fund returns for class B shares reflect
the applicable contingent deferred sales charge (CDSC), which is 5% in
the first year, declines to 1% in the sixth year, and is eliminated
thereafter. For class C shares, returns for periods prior to their
inception are derived from the historical performance of class A shares,
adjusted to reflect both the CDSC currently applicable to class C
shares, which is 1% for the first year and is eliminated thereafter, and
the higher operating expenses applicable to class C shares. 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.
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.
DISTRIBUTION INFORMATION 12 MONTHS ENDED 9/30/00
Class A Class B Class C Class M
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Distributions
(number) 12 12 12 12
------------------------------------------------------------------------------
Income $0.056404 $0.051289 $0.051324 $0.055090
------------------------------------------------------------------------------
Total $0.056404 $0.051289 $0.051324 $0.055090
------------------------------------------------------------------------------
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.
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 investment 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.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities, divided by the number of outstanding shares, not including
any initial or contingent deferred sales charge.
Contingent deferred sales charge (CDSC) is a charge applied at the time
of the redemption of class B or C shares and assumes redemption at the
end of the period. Your fund's class B CDSC declines from a 5% maximum
during the first year to 1% during the sixth year. After the sixth year,
the CDSC no longer applies. The CDSC for class C shares is 1% for one
year after purchase.
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.
A GUIDE TO THE FINANCIAL STATEMENTS
These sections of the report, preceded by the Report of independent
accountants, constitute the fund's financial statements.
The fund's portfolio lists all the fund's investments and their values
as of the last day of the reporting period. Holdings are organized by
asset type and industry sector, country, or state to show areas of
concentration and diversification.
Statement of assets and liabilities shows how the fund's net assets and
share price are determined. All investment and noninvestment assets are
added together. Any unpaid expenses and other liabilities are
subtracted from this total. The result is divided by the number of
shares to determine the net asset value per share, which is calculated
separately for each class of shares. (For funds with preferred shares,
the amount subtracted from total assets includes the net assets
allocated to remarketed preferred shares.)
Statement of operations shows the fund's net investment gain or loss
for the reporting period. This is determined by adding up all the fund's
earnings -- from dividends and interest income -- and subtracting its
operating expenses. This statement also lists any net gain or loss the
fund realized on the sales of its holdings and -- for holdings that
remain in the portfolio -- any change in unrealized gains or losses over
the period.
Statement of changes in net assets shows how the fund's net assets were
affected by distributions to shareholders and by changes in the number
of the fund's shares. It lists distributions and their sources (net
investment income or realized capital gains) over the current reporting
period and the most recent fiscal year-end. The distributions listed
here may not match the sources listed in the Statement of operations
because the distributions are determined on a tax basis and may be paid
in a different period from the one in which they were earned.
Financial highlights provide an overview of the fund's investment
results, per-share distributions, expense ratios, net investment income
ratios and portfolio turnover in one summary table, reflecting the five
most recent reporting periods. In a semiannual report, the highlight
table also includes the current reporting period. For open-end funds, a
separate table is provided for each share class.
REPORT OF INDEPENDENT ACCOUNTANTS
For the fiscal year ended September 30, 2000
To the Trustees and Shareholders of
Putnam Money Market Fund
In our opinion, the accompanying statement of assets and liabilities,
including the fund's portfolio, and the related statements of operations
and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Putnam Money
Market Fund (the "fund") at September 30, 2000, and the results of its
operations, the changes in its net assets and the financial highlights
for the periods indicated, in conformity with accounting principles
generally accepted in the United States of America. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the fund's management; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial
statements in accordance with auditing standards generally accepted in
the United States of America, which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of investments owned at
September 30, 2000 by correspondence with the custodian, provide a
reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
November 3, 2000
<TABLE>
<CAPTION>
THE FUND'S PORTFOLIO
September 30, 2000
COMMERCIAL PAPER (83.3%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
<S> <C> <C> <C>
Domestic (57.1%)
-------------------------------------------------------------------------------------------------------------------
$35,000,000 AES Shady Point, Inc. (NationsBank
Corp. (LOC)) 6.52s 10/30/00 $ 34,809,833
45,000,000 American Express Credit Co. 6.48s 10/2/00 44,983,800
40,000,000 Asset Securitization Cooperative Corp. 6.5s 10/25/00 39,819,444
20,000,000 Associates First Capital Corp. FRN, 6.65s, 2001 10/1/01 20,000,000
34,150,000 AT&T Co. 6.52s 10/23/00 34,007,746
43,000,000 Bank One Corp. Ser. B, FRN, 6.80s 10/5/00 42,998,868
40,000,000 Banc One Financial Corp. 6.5s 12/20/00 39,415,000
43,000,000 Bear Sterns Co. Inc. 6.49s 12/6/00 42,480,620
40,000,000 BMW US Capital Corp. 6.55s 10/4/00 39,970,889
20,000,000 Chevron UK Investment PLC 6.49s 11/6/00 19,866,594
40,000,000 Ciesco L.P. 6.5s 10/17/00 39,877,222
85,170,000 CIT Group, Inc. 6.7s 10/2/00 85,122,447
44,000,000 Corporate Asset Funding Corp. 6.53s 10/18/00 43,856,340
31,200,000 Corporate Asset Funding Corp. 6.51s 11/16/00 30,934,826
36,000,000 Corporate Asset Funding Corp. 6.51s 11/8/00 35,746,110
50,000,000 Corporate Asset Funding Corp. 6.5s 11/17/00 49,566,667
40,000,000 Corporate Receivables Corp. 6.54s 10/12/00 39,912,800
50,000,000 CXC Inc. 6.51s 10/31/00 49,719,708
50,000,000 CXC Inc. 6.51s 10/19/00 49,828,208
30,000,000 CXC Inc. 6.5s 10/30/00 29,837,500
45,500,000 CXC Inc. 6.485s 12/11/00 44,909,865
33,444,000 Delaware Funding Corp. 6.52s 10/20/00 33,322,858
36,929,000 Delaware Funding Corp. 6.5s 10/17/00 36,815,648
25,530,000 Falcon Asset Securitization Corp. 6.52s 11/20/00 25,294,188
50,000,000 Falcon Asset Securitization Corp. 6.52s 10/4/00 49,963,806
45,850,000 Falcon Asset Securitization Corp. 6.5s 11/13/00 45,485,747
30,000,000 Florens Containers, Inc. (Bank of America
NT & SA (LOC)) 6.58s 10/11/00 29,939,683
30,000,000 Florens Containers, Inc. (Bank of America
NT & SA (LOC)) 6.58s 10/10/00 29,945,167
42,000,000 Ford Motor Credit Co. 6.5s 10/23/00 41,825,583
50,000,000 Ford Motor Credit Co. 6.49s 10/12/00 49,891,833
39,000,000 General Electric Capital Corp. 6.48s 2/14/01 38,038,260
28,900,000 General Electric Capital Corp. 6.48s 12/7/00 28,546,264
50,000,000 General Electric Capital International Funding 6.52s 1/26/01 48,931,444
50,000,000 General Electric Capital International Funding 6.5s 10/25/00 49,774,306
40,000,000 Goldman Sachs 6.79s 11/8/00 39,705,767
31,000,000 Goldman Sachs 6.56s 1/19/01 30,372,973
37,000,000 Goldman Sachs 6.5s 2/14/01 36,084,764
43,000,000 Household International 6.61s 10/13/00 43,000,000
49,000,000 Lehman Brothers Holdings 6.695s 1/31/01 47,879,145
20,988,000 National Rural Utilities 6.455s 3/26/01 20,321,902
25,279,000 Old Line Funding Corp. 6.51s 11/14/00 25,073,292
48,000,000 Old Line Funding Corp. 6.51s 11/2/00 47,713,560
45,000,000 Park Avenue Receivables Corp. 6.52s 10/18/00 44,853,300
40,000,000 PNC Funding Corp. 6.58s 10/26/00 39,809,911
42,000,000 Preferred Receivables Funding Corp. 6.5s 10/3/00 41,977,250
45,000,000 Prudential Funding Corp. 6.5s 10/13/00 44,894,375
50,000,000 Salomon Smith Barney Holdings Inc. 6.5s 11/7/00 49,656,944
50,000,000 Salomon Smith Barney Holdings Inc. 6.5s 11/3/00 49,693,056
40,000,000 Salomon Smith Barney Holdings Inc. 6.5s 10/27/00 39,805,000
40,000,000 Salomon Smith Barney Holdings Inc. 4.9s 11/21/00 39,625,022
34,000,000 Sheffield Receivables Corp. 6.52s 10/16/00 33,901,476
30,000,000 Sheffield Receivables Corp. 6.52s 10/6/00 29,967,400
65,000,000 Sheffield Receivables Corp. 6.5s 12/14/00 64,119,792
53,000,000 Sigma Finance Inc. 144A, FRN, 6.611s 3/15/01 52,999,686
26,500,000 Sigma Finance Inc. 6.56s 11/1/00 26,345,476
61,000,000 Sigma Finance Inc. 6.5s 12/5/00 60,273,083
40,000,000 Sigma Finance Inc. 6.5s 10/24/00 39,826,667
25,398,000 Thunder Bay Funding Inc. 6.51s 10/12/00 25,342,802
20,337,000 Thunder Bay Funding Inc. 6.5s 12/11/00 20,072,619
30,000,000 Thunder Bay Funding Inc. 6.49s 12/12/00 29,605,192
25,000,000 Transamerica Finance Corp. 6.53s 12/7/00 24,691,639
22,670,000 Transamerica Finance Corp. 6.48s 11/14/00 22,486,373
40,000,000 Ventures Business Trust 6.58s 10/16/00 39,883,022
43,398,000 Verizon Network Funding 6.51s 11/20/00 42,997,762
41,000,000 Verizon Network Funding 6.5s 11/28/00 40,563,236
44,000,000 Verizon Network Funding 6.5s 11/27/00 43,539,222
24,000,000 Wal-Mart Stores Inc. 6.48s 11/21/00 23,775,360
-------------
2,626,296,342
Foreign (25.2%)
-------------------------------------------------------------------------------------------------------------------
43,000,000 Abbey National North America Corp. 6.35s
(United Kingdom) 12/22/00 42,370,468
25,203,000 Aegon Funding Corp. 6.64s (Netherlands) 12/14/00 24,854,358
34,000,000 Aegon Funding Corp. 6.52s (Netherlands) 2/13/01 33,162,542
43,000,000 Bank of Nova Scotia 6.55s (Canada) 1/24/01 42,993,508
50,000,000 Banco De Galicia Y Buenos Aires S.A.
(Bayerische Hypo-und Vereinsbank AG (LOC))
6.57s (Germany) 10/10/00 49,908,750
25,000,000 Banco General De Negocios S.A. (Barclays Bank
PLC (LOC)) 6.45s (United Kingdom) 4/6/01 24,157,917
43,000,000 Canadian Imperial Bank of Commerce
7.36s (Canada) 5/17/01 42,997,455
44,000,000 Credit Suisse First Boston 6.49s (Switzerland) 3/5/01 42,762,573
44,500,000 Credit Suisse First Boston International
Guernsey 6.5s (Switzerland) 3/12/01 43,190,340
34,000,000 DaimlerChrysler NA Holding Corp.
6.27s (Germany) 12/13/00 33,561,797
17,500,000 Demir Funding Corp. (Bayerische Vereinsbank
(LOC)) 6.32s (Germany) 10/11/00 17,466,206
52,000,000 Den Danske Corp. Inc. 6.5s (Denmark) 11/29/00 51,436,667
39,000,000 Den Norske Bank 6.49s (Norway) 11/28/00 38,585,181
25,000,000 Formosa Plastics Corp. (ABN AMRO Bank N.V.
(LOC)) Ser. A, 6.3s (Netherlands) 10/10/00 24,956,250
53,000,000 Formosa Plastics Corp. (ABN AMRO Bank N.V.
(LOC)) Ser. A, 6.29s (Netherlands) 10/11/00 52,895,570
40,000,000 Halifax Group PLC 6.48s (United Kingdom) 11/8/00 39,719,200
42,000,000 MeritaNordbanken Group 5.852s (Sweden) 3/1/01 41,993,177
47,500,000 Nordbanken NA Inc. 6.54s (Sweden) 2/15/01 46,309,175
26,000,000 PEMEX Capital, Inc. (Barclays (LOC)) 6.85s (France) 12/4/00 25,678,431
39,800,000 PEMEX Capital, Inc. (Barclays (LOC)) 6.6s (France) 12/5/00 39,318,420
24,500,000 PEMEX Capital, Inc. (Barclays (LOC)) 6.52s (France) 12/7/00 24,198,269
43,000,000 Societe Generale 6.37s (France) 12/26/00 42,338,051
44,000,000 Societe Generale 6.47s (France) 2/27/01 42,813,833
44,000,000 Spintab AB 6.54s (Sweden) 12/4/00 43,485,200
44,000,000 Spintab AB 6.54s (Sweden) 10/16/00 43,872,107
42,000,000 Svenska Handelsbanken 6.98s (Sweden) 5/2/01 41,995,338
29,000,000 Unibanco-Grand Caymen (WestDeutsche
Landesbank (LOC)) 6.665s (Germany) 7/13/01 27,464,458
25,000,000 United Mexican States (Barclays (LOC))
6.52s (United Kingdom) 24,723,806
22,000,000 WestDeutsche Landesbank Girozentrale
7.1s (Germany) 5/3/01 22,000,000
44,000,000 Woolwich PLC 6.64s (United Kingdom) 12/18/00 43,358,871
43,000,000 Woolwich PLC 6.5s (United Kingdom) 11/13/00 42,658,389
-------------
1,157,226,307
--------------
Total Commercial Paper (cost $3,783,522,649) $3,783,522,649
CERTIFICATES OF DEPOSITS (4.6%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
-------------------------------------------------------------------------------------------------------------------
$ 43,000,000 Bank of Nova Scotia 6.72s (Canada) 2/12/01 $ 42,992,279
39,000,000 Bayerische Landesbank Girozentrale
6.674s (Germany) 2/28/01 38,992,124
43,000,000 Deutsche Bank 6.75s (Germany) 2/22/01 42,991,900
43,000,000 Societe Generale NY 6.598s (France) 7/5/01 42,980,350
42,000,000 Societe Generale NY 6.56s (France) 1/16/01 41,993,963
--------------
Total Certificates of Deposits (cost $209,950,616) $ 209,950,616
CORPORATE BONDS AND NOTES (9.2%) (a) MATURITY
PRINCIPAL AMOUNT DATE VALUE
-------------------------------------------------------------------------------------------------------------------
$ 53,000,000 Bank One Corp. 6.74s 12/29/00 $ 53,000,000
39,000,000 Bank One Corp. Ser. B, FRN, 6.71s 11/17/00 38,998,971
47,000,000 Credit Suisse First Boston 144A company
guaranty, FRN, 6.61s, 2001 8/10/01 47,000,000
32,000,000 First Union National Bank FRN, 6.72s 5/10/01 32,005,720
43,000,000 First Union National Bank FRN, 6.621s 5/29/01 43,000,000
43,000,000 Fleet Financial Group. sr. FRN, 6.037s, 2001 3/13/01 42,985,993
35,000,000 Goldman Sachs Ser. A, FRN, 6.90s 1/25/01 35,020,407
44,000,000 JP Morgan & Co., Inc. Ser. A, FRN, 6.613s 3/16/01 44,000,000
43,000,000 Morgan Stanley Dean Witter & Co. FRN, 6.603s, 2001 3/16/01 42,998,033
43,000,000 National Rural Utilities Ser. C, FRN, 6.62s 6/15/01 43,000,000
--------------
Total Corporate Bonds and Notes
(cost 422,009,124) $ 422,009,124
<CAPTION>
U.S. GOVERNMENT & AGENCY OBLIGATIONS (1.2%) (a) (cost 54,609,194)
PRINCIPAL AMOUNT VALUE
<S> <C> <C>
-------------------------------------------------------------------------------------------------------------------
$ 55,000,000 Federal National Mortgage Corp 6.04s. 11/9/00 $ 54,609,194
-------------------------------------------------------------------------------------------------------------------
Total Investments (cost $4,470,091,583) (b) $4,470,091,583
-------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $4,597,465,518.
(b) The aggregate identified cost on a tax basis is the same.
The rates shown Floating on Rate Notes (FRN) are the current
interest rates shown at September 30, 2000, which are subject to change
based on the terms of the security.
DIVERSIFICATION BY COUNTRY
Distribution of investments by country of issue at September 30, 2000: (as percentage of Market Value)
Canada 2.9%
Denmark 1.2
France 5.8
Germany 5.2
Netherlands 3.0
Norway 0.9
Sweden 4.9
Switzerland 1.9
United Kingdom 4.9
United States 69.3
------
Total 100.0%
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
September 30, 2000
<S> <C>
Assets
-------------------------------------------------------------------------------------------
Investments in securities, at amortized cost (Note 1) $4,470,091,583
-------------------------------------------------------------------------------------------
Cash 292,874
-------------------------------------------------------------------------------------------
Interest and other receivables 12,712,843
-------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 166,928,740
-------------------------------------------------------------------------------------------
Total assets 4,650,026,040
Liabilities
-------------------------------------------------------------------------------------------
Distributions payable to shareholders 1,030,257
-------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 46,719,117
-------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 3,481,757
-------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 823,423
-------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 99,783
-------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 7,096
-------------------------------------------------------------------------------------------
Payable for distribution fees (Note 2) 300,151
-------------------------------------------------------------------------------------------
Other accrued expenses 98,938
-------------------------------------------------------------------------------------------
Total liabilities 52,560,522
-------------------------------------------------------------------------------------------
Net assets $4,597,465,518
Represented by
-------------------------------------------------------------------------------------------
Paid-in capital (Note 4) $4,597,465,518
-------------------------------------------------------------------------------------------
Net asset value, offering and redemption price per class A
share ($3,780,309,233 divided by 3,780,309,233 shares)* $1.00
-------------------------------------------------------------------------------------------
Net asset value and offering price per class B share
($649,826,226 divided by 649,826,226 shares)** $1.00
-------------------------------------------------------------------------------------------
Net asset value and offering price per class C share
($52,872,108 divided by 52,872,108 shares)** $1.00
-------------------------------------------------------------------------------------------
Net asset value, offering and redemption price per class M share
($114,457,951 divided by 114,457,951 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. Redemption price per share is equal to net
asset value less any applicable contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
Year ended September 30, 2000
<S> <C>
Interest income $280,714,304
-------------------------------------------------------------------------------------------
Expenses:
-------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 14,348,517
-------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 5,821,692
-------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 119,179
-------------------------------------------------------------------------------------------
Administrative services (Note 2) 29,634
-------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 4,049,372
-------------------------------------------------------------------------------------------
Distribution fees -- Class C (Note 2) 126,436
-------------------------------------------------------------------------------------------
Distribution fees -- Class M (Note 2) 173,109
-------------------------------------------------------------------------------------------
Other 1,918,525
-------------------------------------------------------------------------------------------
Total expenses 26,586,464
-------------------------------------------------------------------------------------------
Expense reduction (Note 2) (1,363,749)
-------------------------------------------------------------------------------------------
Net expenses 25,222,715
-------------------------------------------------------------------------------------------
Net investment Income 255,491,589
-------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $255,491,589
-------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
Year ended September 30
---------------------------------
2000 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase (decrease) in net assets
--------------------------------------------------------------------------------------------------
Operations:
--------------------------------------------------------------------------------------------------
Net investment income $ 255,491,589 $ 190,719,005
--------------------------------------------------------------------------------------------------
Net increase in net assets resulting
from operations 255,491,589 190,719,005
--------------------------------------------------------------------------------------------------
Distributions to shareholders:
--------------------------------------------------------------------------------------------------
From net investment income
Class A (205,971,249) (151,295,146)
--------------------------------------------------------------------------------------------------
Class B (41,749,961) (34,510,760)
--------------------------------------------------------------------------------------------------
Class C (1,361,270) (151,030)
--------------------------------------------------------------------------------------------------
Class M (6,409,109) (4,762,069)
--------------------------------------------------------------------------------------------------
Increase (decrease) from
capital share transactions (Note 4) (288,687,405) 1,432,680,477
--------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets (288,687,405) 1,432,680,477
Net assets
--------------------------------------------------------------------------------------------------
Beginning of year 4,886,152,923 3,453,472,446
--------------------------------------------------------------------------------------------------
End of year $4,597,465,518 $4,886,152,923
--------------------------------------------------------------------------------------------------
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
-----------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended September 30
-----------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Net investment income .0564 .0478 .0517 .0505 .0507
-----------------------------------------------------------------------------------------------------
Total from
investment operations .0564 .0478 .0517 .0505 .0507
-----------------------------------------------------------------------------------------------------
Total distributions (.0564) (.0478) (.0517) (.0505) (.0507)
-----------------------------------------------------------------------------------------------------
Net asset value,
end of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Ratios and supplemental data
-----------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 5.79 4.89 5.29 5.17 5.19
-----------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $3,780,309 $3,691,475 $2,598,891 $2,134,223 $1,659,288
-----------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .49 .48 .58 .57 .57
-----------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 5.69 4.73 5.20 5.06 5.00
-----------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through expense offset arrangements (Note 2).
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS B
-----------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended September 30
-----------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Net investment income .0513 .0429 .0468 .0455 .0457
-----------------------------------------------------------------------------------------------------
Total from
investment operations .0513 .0429 .0468 .0455 .0457
-----------------------------------------------------------------------------------------------------
Total distributions (.0513) (.0429) (.0468) (.0455) (.0457)
-----------------------------------------------------------------------------------------------------
Net asset value,
end of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Ratios and supplemental data
-----------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 5.25 4.37 4.78 4.65 4.67
-----------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $649,826 $1,041,452 $759,748 $410,885 $438,316
-----------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .99 .98 1.08 1.07 1.07
-----------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 5.13 4.24 4.69 4.57 4.51
-----------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through expense offset arrangements (Note 2).
</TABLE>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS C
--------------------------------------------------------------
For the period
Per-share Year ended Feb. 1, 1999+
operating performance Sept. 30 to Sept. 30
--------------------------------------------------------------
2000 1999
--------------------------------------------------------------
Net asset value,
beginning of period $1.00 $1.00
--------------------------------------------------------------
Net investment income .0513 .0284
--------------------------------------------------------------
Total from
investment operations .0513 .0284
--------------------------------------------------------------
Total distributions (.0513) (.0284)
--------------------------------------------------------------
Net asset value,
end of period $1.00 $1.00
--------------------------------------------------------------
Ratios and supplemental data
--------------------------------------------------------------
Total return
at net asset value (%)(a) 5.26 2.87*
--------------------------------------------------------------
Net assets, end of period
(in thousands) $52,872 $17,091
--------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .99 .65*
--------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 5.34 2.83*
--------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through expense offset arrangements (Note 2).
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS M
-----------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended September 30
-----------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Net investment income .0551 .0463 .0502 .0490 .0490
-----------------------------------------------------------------------------------------------------
Total from
investment operations .0551 .0463 .0502 .0490 .0490
-----------------------------------------------------------------------------------------------------
Total distributions (.0551) (.0463) (.0502) (.0490) (.0490)
-----------------------------------------------------------------------------------------------------
Net asset value,
end of period $1.00 $1.00 $1.00 $1.00 $1.00
-----------------------------------------------------------------------------------------------------
Ratios and supplemental data
-----------------------------------------------------------------------------------------------------
Total return
at net asset value (%)(a) 5.65 4.73 5.14 5.01 5.02
-----------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $114,458 $136,134 $94,833 $58,502 $29,075
-----------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .64 .63 .73 .72 .72
-----------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 5.51 4.58 5.04 4.92 4.82
-----------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through expense offset arrangements (Note 2).
</TABLE>
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
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 current income consistent with
preservation of capital and maintenance of liquidity. The fund achieves
its objective by 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. 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 investment plans.
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. Shareholders who acquired class B and class C shares through an
exchange are subject to the same deferred sales charge schedule as the
fund from which they were exchanged. 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 the 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 of the financial statements and the reported
amounts of increases and decreases in net assets from operations during
the reporting period. Actual results could differ from those estimates.
A) Security valuation The valuation of the funds' 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 Investment Management, Inc. ("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) Repurchase agreements The fund, or any joint trading account, through
its custodian, receives delivery of the underlying securities, the
market value of which at the time of purchase is required to be in an
amount at least equal to the resale price, including accrued interest.
Collateral for certain tri-party repurchase agreements is held at the
counterparty's custodian in a segregated account for the benefit of the
fund and the counterparty. Putnam Management is responsible for
determining that the value of these underlying securities is at all
times at least equal to the resale price, including accrued interest.
D) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy
or sell is executed).
E) 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.
F) Interest income and distributions to shareholders Interest is
recorded on the accrual basis. Income dividends are recorded daily by
the fund and are paid monthly to the shareholders. Distributions of
realized gains, if any, are paid at least annually.
G) Amortization of bond premium and accretion of bond discount Premiums
and discounts from purchases of short-term investments are
amortized/accreted at a constant rate until maturity.
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 year ended September 30, 2000, fund expenses were reduced by
$1,363,749 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 $2,674
has been allocated to the fund and an additional fee for each Trustees
meeting attended. 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
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 a 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 Retail Management, Inc., 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 Retail Management, Inc. at an annual rate up to
0.75%, 1.00% 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 B, class C and class M shares,
respectively.
For the year ended September 30, 2000, Putnam Retail Management, Inc.,
acting as underwriter received net commissions of $5,581,394 and $88,972
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 year ended
September 30, 2000, Putnam Retail Management, Inc., acting as the
underwriter received no monies in contingent deferred sales charges from
redemptions of class A shares acquired through an exchanges from another
fund.
Note 3
Purchases and sales of securities
During the year ended September 30, 2000, cost of purchases and proceeds
from sales (including maturities) of investment securities (all
short-term obligations) aggregated $92,781,617,861 and $93,601,561,325,
respectively.
Note 4
Capital shares
At September 30, 2000, 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:
Year ended September 30
---------------------------------------------------------------------------
Class A 2000 1999
---------------------------------------------------------------------------
Shares sold 13,559,891,513 10,270,592,982
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 195,361,991 145,761,022
---------------------------------------------------------------------------
13,755,253,504 10,416,354,004
Shares
repurchased (13,666,419,670) (9,323,769,763)
---------------------------------------------------------------------------
Net increase 88,833,834 1,092,584,241
---------------------------------------------------------------------------
Year ended September 30
---------------------------------------------------------------------------
Class B 2000 1999
---------------------------------------------------------------------------
Shares sold 2,539,282,766 2,660,145,189
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 37,603,003 32,075,627
---------------------------------------------------------------------------
2,576,885,769 2,692,220,816
Shares
repurchased (2,968,511,949) (2,410,516,905)
---------------------------------------------------------------------------
Net increase
(decrease) (391,626,180) 281,703,911
---------------------------------------------------------------------------
For the period
February 1, 1999
(commencement
Year ended of operations) to
September 30 September 30
---------------------------------------------------------------------------
Class C 2000 1999
---------------------------------------------------------------------------
Shares sold 360,862,501 29,815,064
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 1,260,996 151,030
---------------------------------------------------------------------------
362,123,497 29,966,094
Shares
repurchased (326,342,248) (12,875,235)
---------------------------------------------------------------------------
Net increase 35,781,249 17,090,859
---------------------------------------------------------------------------
Year ended September 30
---------------------------------------------------------------------------
Class M 2000 1999
---------------------------------------------------------------------------
Shares sold 976,960,996 829,077,838
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 6,065,448 4,690,359
---------------------------------------------------------------------------
983,026,444 833,768,197
Shares
repurchased (1,004,702,752) (792,466,731)
---------------------------------------------------------------------------
Net increase
(decrease) (21,676,308) 41,301,466
---------------------------------------------------------------------------
FEDERAL TAX INFORMATION
(Unaudited)
The Form 1099 you receive in January 2001 will show the tax status of
all distributions paid to your account in calendar 2000.
FUND INFORMATION
WEB SITE
www.putnaminvestments.com
INVESTMENT MANAGER
Putnam Investment Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Retail Management, Inc.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
TRUSTEES
John A. Hill, 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
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam, III
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 M. Driscoll
Vice President and Fund Manager
Richard A. Monaghan
Vice President
Richard G. Leibovitch
Vice President
John R. Verani
Vice President
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 and
Putnam's Quarterly Ranking 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:
www.putnaminvestments.com.
Not FDIC Insured, May Lose Value, No Bank Guarantee
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
---------------------
PRST STD
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
---------------------
For account balances, economic forecasts, and the latest on Putnam funds, visit
www.putnaminvestments.com
AN039-65462 010/879/534 11/00
