Putnam
New York
Tax Exempt
Money Market Fund
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
5-31-99
[LOGO: BOSTON * LONDON * TOKYO]
From the Chairman
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[copyright] Karsh, Ottawa
Dear Shareholder:
Over the past six months, a fairly sanguine atmosphere of robust economic
growth and low inflation combined with strong municipal balance sheets to
provide a favorable environment for New York tax-exempt money market
investors. The state continued to enjoy rising tax revenues and improving
creditworthiness, providing a solid backdrop for the performance of its
tax-exempt money market securities. In fact, New York State and New York
City general obligation municipal bonds both received credit upgrades
during the period, as ongoing economic growth, strong financial operating
results, and a sustained record of accurate revenue projections buoyed
their creditworthiness. Putnam New York Tax Exempt Money Market Fund's
recent performance reflects this relatively favorable environment.
Total return for 6 months ended 5/31/99
Net asset value
- ----------------------------------------------------------------
1.20%
- ----------------------------------------------------------------
Past performance is no indication of future results. Performance
information for longer periods begins on page 6.
* DURATION ADJUSTMENTS KEEP PACE WITH INTEREST RATES
Overall, the U.S. economy remains in a fairly solid position. Growth has
continued in most sectors at a steady -- though not alarmingly fast --
pace. New York has shared in this expansion, with New York City's economy
driven largely by growth in the financial services area and the rest of
the state reflecting strength in a wide spectrum of industries. The
nation's inflation rate has begun to tick up in recent months, however,
with the consumer price index moving toward an annualized core inflation
rate of approximately 2%. Since inflation in 1998 was practically
nonexistent, a move to 2% may seem enormous, but it is actually still well
below the 4% rate that has been generally considered average. Despite some
signs of inflation, we still live predominantly in a deflationary world in
which many prices are falling. For evidence of deflation, one need only
consider online stock trading prices and the discounts available from
online bookstores.
This slight uptick in inflation is but one of the challenges investors
have faced over the past six months. Earlier, they grappled with recurring
instability in the emerging markets, an apparent stall in the U.S.
economy, and a potential shift in Federal Reserve Board monetary policy.
Following an autumn that saw the Fed lower short-term interest rates three
times in just seven weeks, in February, some market participants saw the
potential for the Fed to raise rates. Inflation expectations had risen,
commodity prices had begun to rise, wage growth stopped declining, and
money and credit continued to grow. These expectations were not realized
during the period, 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 the fund during the semiannual period required
flexibility. Once again, managing portfolio duration has been one of the
most important elements of your fund manager's strategy. At the start of
the period, your fund's manager, Brian Torpey, had been keeping portfolio
duration extended in order to lock in the highest available municipal
money market rates in a falling interest-rate environment. As it became
clear that the Fed was unlikely to lower interest rates any further, Brian
brought duration back to a more neutral position where it remained for the
rest of the period. This strategy allowed the fund to maximize its income
stream amid extremely low securities supply and a more stable
interest-rate climate.
* SUPPLY DECLINES BUT QUALITY EMPHASIS REMAINS
In addition to declining interest rates, tax-exempt money market investors
had to contend with a dwindling supply of issues. As New York State's
economy continued to expand throughout the period, its borrowing needs
lessened. Consequently, the supply of tax-exempt municipal securities
dropped. Demand remained high for most of the period, however, as
risk-averse investors continued to find comfort in the liquidity, quality,
and relative stability of a fund like yours. Demand did taper off a bit as
the period drew to a close.
Throughout this period of lower securities supply and tapering demand,
your fund manager redoubled efforts to maintain current income while
preserving capital and staying focused on investments of superior quality.
The fund has always made capital preservation and credit quality top
priorities, investing in a wide spectrum of superior quality tax-exempt
money market securities. In the current portfolio, more than 70% of
holdings are either insured or backed by letters of credit.
In the months ahead, Brian will continue to seek out opportunities to
extend portfolio duration in anticipation of the cyclical supply and
demand swell that regularly occurs in June and July. At the same time, he
will remain watchful of credit quality and focused on preserving capital,
continuing to implement the conservative strategies that have served
shareholders well thus far.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
July 21, 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 5/31/99, 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 (5/31/99)
Current After-tax After-tax
return* return1 return2
- ----------------------------------------------------------------------------
Passbook savings account 1.24% 0.67% 0.70%
- ----------------------------------------------------------------------------
Taxable money market fund (7-day yield) 4.03 2.17 2.26
- ----------------------------------------------------------------------------
3-month certificate of deposit 4.41 2.37 2.47
- ----------------------------------------------------------------------------
Putnam New York Tax Exempt
Money Market Fund (7-day yield) 2.54 2.54 2.54
- ----------------------------------------------------------------------------
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.
1 After-tax return assumes a combined 46.27% federal, New York state, and
New York City tax rate.
2 After-tax return assumes a combined 43.90% federal and New York state
tax rate.
* 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 New York Tax
Exempt Money Market Fund is designed for investors seeking current income
exempt from federal income tax, consistent with capital preservation, stable
principal, and liquidity.
TOTAL RETURN FOR PERIODS ENDED 5/31/99
Lipper
New York
Tax Exempt Consumer
Fund shares Money Market price
at NAV Funds Average index
- ----------------------------------------------------------------------------
6 months 1.20% 1.24% 1.34%
- ----------------------------------------------------------------------------
1 year 2.59 2.65 2.09
- ----------------------------------------------------------------------------
5 years 15.09 15.47 12.68
Annual average 2.85 2.92 2.42
- ----------------------------------------------------------------------------
10 years 35.93 36.52 34.25
Annual average 3.12 3.16 2.99
- ----------------------------------------------------------------------------
Life of fund (10/26/87) 46.42 47.01 44.15
Annual average 3.34 3.39 3.21
- ----------------------------------------------------------------------------
Fund shares
at NAV
- ----------------------------------------------------------------------------
Current return (end of period)
- ----------------------------------------------------------------------------
Current 7-day yield1 2.54%
- ----------------------------------------------------------------------------
Taxable equivalent (a)2 4.51
- ----------------------------------------------------------------------------
Taxable equivalent (b)2 4.68
- ----------------------------------------------------------------------------
Current 30-day yield1 2.76
- ----------------------------------------------------------------------------
Taxable equivalent (a)2 4.91
- ----------------------------------------------------------------------------
Taxable equivalent (b)2 5.09
- ----------------------------------------------------------------------------
1 The 7-day and 30-day yields are the two most common gauges for measuring
money market mutual fund performance.
2 Assumes (a) maximum 43.74% combined federal income tax and New York
state personal income tax rate or (b) maximum 45.77% combined federal
income tax, New York state and New York City personal income tax rate.
Results for investors subject to lower tax rates would not be as
advantageous. For some investors, investment income may also be subject to
the federal alternative minimum tax. Investment income may be subject to
state and local taxes.
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. 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 6 MONTHS ENDED 5/31/99
- --------------------------------------------------------------------------
Distributions (number) 6
- --------------------------------------------------------------------------
Income $0.011922
- --------------------------------------------------------------------------
Total $0.011922
- --------------------------------------------------------------------------
TOTAL RETURN FOR PERIODS ENDED 6/30/99 (most recent calendar quarter)
Fund shares
at NAV
- --------------------------------------------------------------------------
6 months 1.07%
- --------------------------------------------------------------------------
1 year 2.42
- --------------------------------------------------------------------------
5 years 15.00
Annual average 2.83
- --------------------------------------------------------------------------
10 years 35.41
Annual average 3.08
- --------------------------------------------------------------------------
Life of fund (10/26/87) 46.53
Annual average 3.33
- --------------------------------------------------------------------------
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.
Comparative benchmarks
Lipper Tax Exempt Money Market Fund Average, used for performance
comparison purposes, is an arithmetic average of the total return of all
tax-exempt 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 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 is determined. All investment and non-investment 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 amounts
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-ended funds, a separate table is
provided for each share class.
<TABLE>
<CAPTION>
The fund's portfolio
May 31, 1999 (Unaudited)
KEY TO ABBREVIATIONS
AMBAC -- AMBAC Indemnity Corporation
FGIC -- Financial Guaranty Insurance Company
FHA Insd. -- Federal Housing Administration Insured
FRB -- Floating Rate Bonds
FSA -- Financial Security Assurance
G.O. Bonds -- General Obligation Bonds
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance Corporation
VRDN -- Variable Rate Demand Notes
MUNICIPAL BONDS AND NOTES (97.4%) (a)
PRINCIPAL AMOUNT RATING (RAT) VALUE
<S> <C> <C> <C>
New York (92.3%)
- --------------------------------------------------------------------------------------------------------------------------
$ 1,900,000 Dutchess Cnty., Indl. Dev. Agcy. Civic Fac.
VRDN (Marist College), Ser. A, FRB, 3.25s,
7/1/28 (Bank of New York (LOC)) A-1+ $ 1,900,000
1,600,000 Glens Falls Indl. Dev. Agcy. VRDN (Broad St. Ctr.),
3.20s, 8/1/05 (Fleet Bank of NY (LOC)) A-1 1,600,000
4,000,000 Long Island, Pwr. Auth. NY Elec. Syst. VRDN,
Ser. 1, 3.45s, 5/1/33 (Westdeutsche
Landesbank (LOC)) VMIG1 4,000,000
425,000 Metropolitan Trans. Auth. Rev. Bonds, Ser. A,
FSA, 4.3s, 7/1/99 Aaa 425,388
1,590,000 Monroe Cnty., Indl. Dev. Agcy. VRDN
(Columbia Sussex Corp.), 5s, 11/1/14
(Cumberland Fed. S&L (LOC)) A-1+ 1,590,000
1,900,000 Niagara Cnty., Indl. Dev. Agcy. Solid Waste Disp.
VRDN (American Fuel Co.), 3 1/4s, 11/15/24 P-1 1,900,000
1,450,000 North Hempstead G.O. Bonds (Pub. Impt.), Ser. B,
AMBAC, 6.9s, 9/1/02 Aaa 1,490,573
NY City, Indl. Dev. Agcy. VRDN
1,500,000 (Stroheim & Romann, Inc.), 3.25s, 12/1/15
(Westdeutsche Landesbank Girozentrale (LOC)) A-1+ 1,500,000
1,900,000 (Columbia Grammar School), 3.1s, 6/30/14
(Chase Manhattan Bank (LOC)) A-1 1,900,000
250,000 NY City, Muni. Assistance Corp. Rev. Bonds,
Ser. D, AMBAC, 4.4s, 7/1/99 Aaa 250,176
NY City, Muni. Fin. Auth. Wtr. & Swr. Syst.
Rev. Bonds, Ser. A
500,000 FGIC, 7 1/2s, 6/15/19 Aaa 528,770
500,000 MBIA, 7 1/2s, 6/15/19 Aaa 528,770
300,000 FGIC, 6 3/4s, 6/15/14 Aaa 304,898
NY State Dorm. Auth. Rev. Bonds
300,000 (Fordham U.), AMBAC, 6.8s, 7/1/99 Aaa 300,883
590,000 (NY U.), FGIC, 6s, 7/1/99 Aaa 591,054
1,900,000 NY State Dorm. Auth. VRDN (Oxford U. Press Inc.),
3.25s, 7/1/23 VMIG1 1,900,000
3,300,000 NY State Energy Res. & Dev. Auth. Poll.
Control VRDN (Niagara Mohawk Pwr.),
Ser. A, 3.15s, 7/1/15 A-1+ 3,300,000
NY State Fin. Agcy. Rev. Bonds
300,000 (State Univ.), 7.4s, 11/1/99 Aaa 305,201
415,000 Ser. A, FSA, 4.2s, 11/1/99 Aaa 416,186
950,000 NY State G.O. Bonds, Ser. B, 5.1s, 8/15/99 A2 952,943
NY State Hsg. Fin. Agcy. VRDN
1,800,000 (Mt. Sinai School), Ser. A, 3 1/4s, 11/1/14
(Chase Manhattan Bank (LOC)) VMIG1 1,800,000
1,600,000 (Special Surgery Hosp. Staff), Ser. A, 3.15s,
11/1/10 (Chase Manhattan Bank (LOC)) VMIG1 1,600,000
450,000 NY State Med. Care Fac. Fin. Agcy. Rev. Bonds
(St. Lukes Hosp.), Ser. B, FHA Insd., 7.4s, 2/15/09 Aaa 471,209
1,900,000 Suffolk Cnty., Indl. Dev. Agcy. VRDN (Cold Spring
Harbor Lab), 3.2s, 7/1/23 (Morgan
Guaranty Trust (LOC)) A-1+ 1,900,000
1,800,000 Syracuse, Indl. Dev. Agcy. Civic Fac. Rev. Bonds
(Syracuse U.), FRB, 3.2s, 3/1/23 VMIG1 1,800,000
980,000 Triborough, Bridge & Tunnel Auth. Obligation
Bonds, Ser. A, 7 1/8s, 1/1/19 Aaa 1,027,358
1,700,000 Westchester Cnty., Indl. Dev. Agcy. Civic Fac. FRB
(Boys & Girls Club), 3.1s, 2/1/24
(Bank of New York (LOC)) A-1+ 1,700,000
--------------
35,983,409
Puerto Rico (5.1%)
- --------------------------------------------------------------------------------------------------------------------------
2,000,000 PR, Indl. Med. & Env. Poll. Ctrl. Fac. Fin. Auth. VRDN
(Reynolds Metal Co.), 3 3/4s, 9/1/13
(ABN AMRO Bank (LOC)) P-1 2,000,846
- --------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $37,984,255) (b) $ 37,984,255
- --------------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $38,992,770.
(RAT) The Moody's or Standard & Poor's ratings indicated are believed to be the most recent ratings available at
May 31, 1999 for the securities listed. Ratings are generally ascribed to securities at the time of issuance.
While the agencies may from time to time revise such ratings, they undertake no obligation to do so, and the
ratings do not necessarily represent what the agencies would ascribe to these securities at May 31, 1999.
Securities rated by Putnam are indicated by "/P" and are not publicly rated.
Moody's Investor Service, Inc. and Standard & Poor's Corp. are the leading independent rating agencies for debt
securities. Moody's uses the designation "Moody's Investment Grade", or "MIG", for most short-term municipal
obligations, adding a "V" ("VMIG") for bonds with a demand or variable feature; the designation "P" is used for
tax exempt commercial paper. Standard & Poor's uses "SP" for notes maturing in three years or less, "A" for bonds
with a demand or variable feature; the designation "/P" is used for tax exempt commercial paper. Standard & Poor's
uses "SP" for notes maturing in three years or less, "A" for bonds with a demand or variable feature.
Moody's Investor Service, Inc.
MIGI/VMIG1 = Best quality; strong protection of cash flows, superior liquidity and broad access to refinancing
MIG2/VMIG2 = High quality; ample protection of cash flows, liquidity support and ability to refinance
AAA = Extremely strong capacity to pay interest and repay principal
AA = Strong capacity to pay interest and repay principal and differs from the higher rated issues only in a
small degree
P-1 = Superior capacity for repayment
P-2 = Strong capacity for repayment
Standard & Poor's Corp.
SP-1+ = Very strong capacity to pay principal and interest
SP-1 = Strong capacity to pay principal and interest
SP-2 = Satisfactory capacity to pay principal and interest
A-1+ = Extremely strong degree of safety
A-1 = Strong degree of safety
A-2 = Satisfactory capacity for timely repayment
(b) The aggregate identified cost on a tax basis is the same.
The rates shown on FRB and VRDN are the current interest rates shown at May 31, 1999, which are subject to change
based on the terms of the security.
The fund had the following industry group concentrations greater than 10% at May 31, 1999 (as a percentage of net
assets):
Education 28.0%
Utilities 18.7
Health care 10.2
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of assets and liabilities
May 31, 1999 (Unaudited)
<S> <C>
Assets
- -----------------------------------------------------------------------------------------------
Investments in securities, at amortized cost (Note 1) $37,984,255
- -----------------------------------------------------------------------------------------------
Cash 139,797
- -----------------------------------------------------------------------------------------------
Interest and other receivables 254,018
- -----------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 881,109
- -----------------------------------------------------------------------------------------------
Receivable for securities sold 100,254
- -----------------------------------------------------------------------------------------------
Total assets 39,359,433
Liabilities
- -----------------------------------------------------------------------------------------------
Distributions payable to shareholders 58,744
- -----------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 237,598
- -----------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 44,524
- -----------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 5,491
- -----------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 4,768
- -----------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 603
- -----------------------------------------------------------------------------------------------
Other accrued expenses 14,935
- -----------------------------------------------------------------------------------------------
Total liabilities 366,663
- -----------------------------------------------------------------------------------------------
Net assets $38,992,770
Represented by
- -----------------------------------------------------------------------------------------------
Paid-in capital (Note 4) $38,992,770
- -----------------------------------------------------------------------------------------------
Computation of net asset value and offering price
- -----------------------------------------------------------------------------------------------
Net asset value, offering and redemption price per share
($38,992,770 divided by 38,992,770 shares) $1.00
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of operations
Six months ended May 31, 1999 (Unaudited)
<S> <C>
Tax exempt interest income $635,741
- -----------------------------------------------------------------------------------------------
Expenses:
- -----------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 87,953
- -----------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 28,947
- -----------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 1,774
- -----------------------------------------------------------------------------------------------
Administrative services (Note 2) 1,769
- -----------------------------------------------------------------------------------------------
Reports to shareholder 3,770
- -----------------------------------------------------------------------------------------------
Registration fees 1,779
- -----------------------------------------------------------------------------------------------
Auditing 8,632
- -----------------------------------------------------------------------------------------------
Legal 3,465
- -----------------------------------------------------------------------------------------------
Postage 1,450
- -----------------------------------------------------------------------------------------------
Other 155
- -----------------------------------------------------------------------------------------------
Total expenses 139,694
- -----------------------------------------------------------------------------------------------
Expense reduction (Note 2) (18,173)
- -----------------------------------------------------------------------------------------------
Net expenses 121,521
- -----------------------------------------------------------------------------------------------
Net investment income 514,220
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $514,220
- -----------------------------------------------------------------------------------------------
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
May 31 November 30
1999* 1998
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase (decrease) in net assets
- ---------------------------------------------------------------------------------------------------------------
Operations:
- ---------------------------------------------------------------------------------------------------------------
Net investment income $ 514,220 $ 1,125,451
- ---------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 514,220 1,125,451
- ---------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income (514,220) (1,125,451)
- ---------------------------------------------------------------------------------------------------------------
Increase (decrease) from capital share transactions (Note 4) 6,619 (5,114,693)
- ---------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 6,619 (5,114,693)
Net assets
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 38,986,151 44,100,844
- ---------------------------------------------------------------------------------------------------------------
End of period $38,992,770 $38,986,151
- ---------------------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share May 31
operating performance (Unaudited) Year ended November 30
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income .0119 .0288 .0287 .0289 .0318 .0188
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations .0119 .0288 .0287 .0289 .0318 .0188
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income (.0119) (.0288) (.0287) (.0289) (.0318) (.0188)
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.0119) (.0288) (.0287) (.0289) (.0318) (.0188)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 1.20* 2.91 2.91 2.93 3.23 1.90
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of year
(in thousands) $38,993 $38,986 $44,101 $39,456 $38,873 $44,815
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .36* .79 .83 .88 .91 .77
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%) 1.31* 2.88 2.92 2.75 3.18 1.86
- ------------------------------------------------------------------------------------------------------------------------------------
* Not annualized
(a) Total return assumes dividend reinvestments.
(b) The ratio of expenses to average net assets for the period ended November 30, 1995 and thereafter, includes amounts
paid through expense offset arrangements. Prior period ratios exclude these amounts. (Note 2).
</TABLE>
Notes to financial statements
May 31, 1999 (Unaudited)
Note 1
Significant accounting policies
Putnam New York Tax Exempt Money Market Fund (the "fund") is registered
under the Investment Company Act of 1940, as amended, as a nondiversified,
open-end management investment company. The fund seeks as high a level of
current income exempt from Federal, New York State and New York City
personal income taxes as Putnam Investment Management, Inc. ("Putnam
Management"), the fund's manager, a wholly-owned subsidiary of Putnam
Investments, Inc., believes is consistent with maintenance of liquidity
and stability of principal. The fund invests primarily in a nondiversified
portfolio of short-term New York tax exempt securities.
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) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed).
C) Federal taxes It is the policy of the fund to distribute all of its
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.
At November 30, 1998, the fund had a capital loss carryover of
approximately $6,700 available to offset future net capital gains, if any.
The amount of the carryover and the expiration dates are:
Loss Carryover Expiration
- -------------- -----------------
$6,600 November 30, 2002
100 November 30, 2005
D) 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.
E) Amortization of bond premium Premiums from purchases of short-term
investments are amortized 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: 0.45% of the first $500
million of average net assets, 0.35% of the next $500 million, 0.30% of
the next $500 million, 0.25% of the next $5 billion, 0.225% of the next $5
billion, 0.205% of the next $5 billion, 0.19% of the next $5 billion, and
0.18% 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 May 31, 1999, fund expenses were reduced by
$18,173 under expense offset arrangements with PFTC and brokerage service
arrangements. 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 $140 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.
For the six months ended May 31, 1999, Putnam Mutual Funds Corp., acting
as underwriter receives proceeds from contingent deferred sales charges
that apply to certain shares that have been exchanged from other Putnam
funds. Putnam Mutual Funds received no monies in contingent deferred sales
charges from such redemptions.
Note 3
Purchase and sales of securities
During the six months ended May 31, 1999, purchases and sales of
investment securities other than short-term investments aggregated
$125,412,226 and $125,960,000 respectively. There were no purchases and
sales of U.S. government obligations. 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 May 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
May 31 November 30
- -----------------------------------------------------------------------------
1999 1998
- -----------------------------------------------------------------------------
Shares sold 19,046,083 34,362,303
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 442,775 1,082,222
- -----------------------------------------------------------------------------
19,488,858 35,444,525
Shares
repurchased (19,482,239) (40,559,218)
- -----------------------------------------------------------------------------
Net increase
(decrease) 6,619 (5,114,693)
- -----------------------------------------------------------------------------
Fund information
WEB SITE
www.putnaminv.com
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
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
William J. Curtin
Vice President
Jerome J. Jacobs
Vice President
Brian S. Torpey
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 New York Tax
Exempt 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: 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
- ---------------------
BULK RATE
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
- ---------------------
For account balances, economic forecasts, and the latest on Putnam funds, visit
www.putnaminv.com
SA056-53220 7/99
