FinancialWeek's "OpEd: Volcker, Group of 30 over the top on money-market funds" is subtitled, "Group wants to take bazooka to money-market industry. It's regulatory overkill, argues Stephen Keen." The piece says, "A private, nonprofit, international body composed of very senior representatives of the private and public sectors -- including Paul Volcker, chair of President Barack Obama's Economic Recovery Advisory Board -- recently concluded that money-market funds are a $3.9 trillion mistake that deserve to be abolished. Their conclusion, however, is based on a fundamental misunderstanding of money-market funds and the problems they encountered in the wake of the Lehman bankruptcy. Although the SEC needs to supplement the already extensive regulation of these funds, there is no reason they should be outlawed." Keen adds, "The advantages of this [new banking] model are not self-evident, however. In the 30 years since the SEC granted to the first order permitting money-market funds, two funds have broken a dollar. On the other hand, the FDIC's website reports 55 bank failures in the past eight years, and the FDIC has lost hundreds of billions paying off depositors of failed banks and S&Ls. In stark contrast, the programs established to support money-market funds and the commercial-paper market are not expected to cost taxpayers a dime."

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