Bloomberg features an editorial by former SEC Chairman Arthur Levitt, entitled, "SEC Missed Chance on Money Funds, Should Step Aside Now." He says, "A former member of the U.S. Securities and Exchange Commission recently asked me to co-sign a letter urging a federal oversight body to refrain from taking regulatory action normally left to the SEC. I believe deeply in the independence of the agency I once led, but in this case, I could not place my loyalty to the organization above the larger goal of protecting individual investors. So I refused to sign. Every regulatory agency operates with a core mandate, and the SEC's is clear: Promote healthy and well-functioning markets, and protect investors through appropriate regulations and enforcement actions. The SEC must always place that mission above all other goals, including its own sovereignty and independence. When it doesn't, others may have to. At stake are much-needed and overdue reforms to money- market mutual funds, which hold $2.5 trillion. These funds were at the heart of the 2008 financial crisis. When the Reserve Primary Fund "broke the buck," in which the value of a share fell below $1, investors realized they would get less than $1 back for every $1 invested. The result was a run on all money-market funds, significant cash hoarding, the evaporation of short-term credit to even the best borrowers, and some of the worst days our economy has ever seen." See also, "SEC to Host Credit Ratings Roundtable," which will hold the event "on May 14 in response to a recent staff report on credit ratings and related matters." See too the recent "Report to Congress on Assigned Credit Ratings."
