“Money Market Funds Must Be Reformed to Prevent More Bailouts”
Washington DC, November 14, 2012—
“We applaud the Financial Stability Oversight Council’s (“FSOC”) action recommending that the SEC propose rules to address the risks from systemically significant money market funds,” said Dennis Kelleher, President and CEO of Better Markets. “It is unfortunate that the SEC has been unable to act before now, but it certainly should with the entire FSOC making the determination that it must. If the SEC does not act, however, then the FSOC itself must propose strong rules to prevent future bailouts of money market funds.”
“There is no dispute that money market funds pose a grave and direct threat to the financial stability of the United States. That was proved during the 2008 financial crisis when taxpayers had to guarantee the $3.7 trillion money market industry to prevent it from collapsing and taking down the short term funding markets. That was the largest single bailout program during the last financial crisis.”
“The SEC or FSOC must prevent that from ever happening again.”
About Better Markets
Better Markets is an independent, nonprofit, nonpartisan organization that promotes the public interest in financial reform in the domestic and global capital and commodity markets. Better Markets advocates for transparency, oversight and accountability with the goal of a stronger, safer financial system that is less prone to crisis and failure thereby eliminating or minimizing the need for more taxpayer funded bailouts.