Majia here: Yesterday I reported that “SEC Refuses to Vote for New Rules Aimed at Securing Money Market Funds Friday,” August 24, 2012 http://majiasblog.blogspot.com/2012/08/sec-refuses-to-vote-for-new-rules-aimed.html
Today I found SEC Chairman Mary Schapiro’s Public Statement on the Failure of the SEC to agree to money market reforms:
Statement of SEC Chairman Mary L. Schapiro on Money Market Fund Reform
FOR IMMEDIATE RELEASE
Washington, D.C., Aug. 22, 2012 — Securities and Exchange Commission Chairman Mary Schapiro today made the following statement:
[Excerpted] Three Commissioners, constituting a majority of the Commission, have informed me that they will not support a staff proposal to reform the structure of money market funds. The proposed structural reforms were intended to reduce their susceptibility to runs, protect retail investors and lessen the need for future taxpayer bailouts…..
As we consider money market funds' susceptibility to runs, we must remember the lessons of the financial crisis and the history of money market funds. And, we must be cognizant that the tools that were used to stop the run on money market funds in 2008 no longer exist. That is, there is no "back-up plan" in place if we experience another run on money market funds because money market funds effectively are operating without a net....
Majia here: "money market funds effectively are operating without a net"
Strong statement. Bold move to share the report with Congress. Bold move to issue this letter publicly.