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Released: August 14, 2012
Tackling money market funds’ hidden risks
Source: Michael Hiltzik, L.A.Times (Free Registration)
Everyone seems to have the same list in mind of threats to our financial security: big, stupid banks; arrogant, dumb derivatives traders; a stock market operated entirely by, and for the benefit of, Cylons. So praise is due Securities and Exchange Commission Chairwoman Mary L. Schapiro for focusing more attention on a greater threat nestled within the portfolios of millions of American investors. We're talking about money market funds. Small investors have gotten used to thinking of these popular mutual funds as if they're interchangeable with bank checking accounts, merely convenient parking lots for cash that might be needed at a moment's notice. Schapiro believes money market funds, which hold commercial paper, short-term bonds and other assets with maturities of a year or less, could destabilize the financial system like the bad old days of 2008 because they're vulnerable to bank-style runs.Read Full Article: Tackling money market funds’ hidden risks
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