ICI Roundtable on March 2020 Crisis
A new posting entitled, "ICI Roundtable Examines Liquidity Crisis of March 2020," tells us that, "Regulators in the United States and around the world have advocated for money market fund reform in recent months, expressing the view that money market funds were primary contributors to the extreme market stress in March 2020. At an ICI roundtable, "A Study of the Performance of Money Market Funds and the Short-Term Funding Markets During March 2020," on April 29, 2021, money market fund managers from eight ICI member firms detailed the events of March 2020, including the challenges they faced and the decisions they made. Any regulatory action in response to the COVID-19 liquidity crisis should take into account the true drivers of the March 2020 events and should be pursued with a well-informed, evidence-based approach." A brief "Summary of Proceedings and Key Points" explains, "The Investment Company Institute (ICI) organized a two-hour roundtable to investigate the activities of money market funds, their investors, and the short-term funding markets during the weeks before the Federal Reserve announced the Money Market Mutual Fund Liquidity Facility (MMLF) on March 18, 2020 and in the days following. The purpose of the roundtable was to study the experience of money market funds during the liquidity crisis through analyzing proprietary data and asking fund managers to detail the behavior of money market funds and money market fund investors in March 2020. Over 160 international regulators, policymakers, industry participants, and academics attended the roundtable. The moderator of the roundtable was Professor Erik Sirri, a professor of finance at Babson College and former Director of Trading and Markets and Chief Economist at the US Securities and Exchange Commission (SEC). Audience members had the opportunity to ask questions." It adds, "Part One of the roundtable consisted of ICI economists Sean Collins and Shelly Antoniewicz presenting their research about money market funds' portfolio activities during March 2020. Part Two of the roundtable consisted of fund managers from eight of the most significant money market fund providers describing their personal experiences managing money market funds during the March 2020 period, their interactions with investors, and the choices made regarding the portfolios."
