"SEC's floating-NAV proposal slowly sinking" writes Investment News. It says, "At a Financial Services Subcommitee hearing today, Republicans appeared to be backing away from a Securities and Exchange proposal that would force money-market funds to adopt a floating net asset value. That's a proposal the mutual fund industry has fought for several months. Regulators and some members of Congress have proposed forcing money market funds to adopt a floating NAV -- as opposed to trying to keep a stable $1 share price -- as a result of concerns about the stability of such funds stemming from the 2008 financial crisis. Last year, the President's Working Group on Financial Markets proposed eight reforms to provide greater stability in the money market fund industry. Among those proposed reforms was allowing money market funds to have a floating NAV. The industry has been protesting the idea, saying that it would cause money market funds to become extinct. And in opening comments during this morning's hearings, Rep. Scott Garrett, R-N.J., chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, agreed that there are concerns about the floating NAV concept." He says, "I am not convinced that replacing a stable NAV with a floating NAV solves the worry about runs in money market funds. There is compelling evidence that [implementing a floating NAV] would lead to a loss of access to a significant source of short-term funding. A floating NAV would also impact investors of all shapes and sizes." IN adds, "Mr. Garrett also suggested that if the floating NAV was implemented it would have dire consequences for the money fund industry."

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