What Others Are Saying

Investors and Issuers Express Widespread Support for Money Market Funds and the Stable NAV

Money market fund sponsors have been joined by a wide range of business, government, financial services, and consumer organizations, all voicing support for maintaining the stable NAV for money market funds and registering their opposition to any move toward a floating NAV. Here is what some of these groups are saying.

Letter from Washington State Treasurer James L. McIntire

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Letter from Denver Mayor Michael Hancock

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Joint letter signed by more than 50 businesses and organizations, September 12, 2013

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Joint letter signed by Mayors from cities and towns across the country, September 12, 2013

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“Conference of Mayors President Smith Expresses Opposition to Proposed Rule Changes for Money Market Mutual Funds” in U.S. Mayor, the official publication of The United States Conference of Mayors, July 29, 2013

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U.S. Conference of Mayors Resolution Adopted at 81st Annual Meeting, June 21-24, 2013

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Up to 65 percent of organizations would be less willing to invest in money market funds (MMFs) and/or would reduce/eliminate their holdings of MMFs currently in their short-term investment portfolios as a result of requiring net asset values (NAVs) to float. – 2013 Association for Financial Professionals (AFP) Liquidity Survey

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“Let’s check the count against floating NAVs. They don’t address regulators’ goals. They eliminate key benefits to investors. They harm the economy. They increase systemic risk. And they carry immense costs and operational complications.” – ICI President and CEO Paul Schott Stevens, June 19, 2013

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“I would be cautious and re-examine whether I would use [MMFs] for the cash component.” – Jason Hochstadt, executive vice president of Jedi Management Inc., quoted on floating NAVs by InvestmentNews, June 9, 2013

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“If, in fact, floating the NAV does not stave off redemptions, one has to question whether abandoning the stable NAV is justified considering the costs and burdens investors would have to bear if a floating NAV undercuts the usefulness of the money market fund as a cash management vehicle.” - Commissioner Troy Paredes, June 5, 2013

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Letter from Former Chairmen, Commissioners, and Senior Staff of the U.S. Securities and Exchange Commission

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New Jersey League of Municipalities

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Joint letter from American Public Power Association, Council of Infrastructure Financing Authorities, Government Finance Officers Association, International City/County Management Association, International Municipal Lawyers Association, National Association of Counties, National Association of Health and Educational Facilities Finance Authorities, National Association of Local Housing Finance Agencies, National Association of State Auditors, Comptrollers and Treasurers, National Association of State Treasurers, National Council of State Housing Agencies, National League of Cities, U.S. Conference of Mayors

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New Jersey Chamber of Commerce

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Signet Jewelers

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U.S. Chamber of Commerce, Center for Capital Markets Competitiveness

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Investment Company Institute

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The SPARK Institute

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Letter from US Chamber of Commerce and more than 75 companies, nonprofits, and organizations

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Minnesota State Retirement System

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Louisiana Retailers Association

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Indiana Chamber of Commerce

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County Commissioners Association of Ohio

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Letter from Robert Comment, Deputy Chief Economist under Former SEC Chairman Arthur Levitt

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Greater Pittsburgh Chamber of Commerce / Allegheny Conference on Community Development

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New Jersey Association of Counties

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Joint letter from Agricultural Retailers Association, American Association of State Colleges and Universities, Association for Financial Professionals, Education Finance Council, Financial Executives International, Government Finance Officers Association, International City/County Management Association, International Municipal Lawyers Association, Mortgage Bankers Association, National Association of College and University Business Officers, National Association of Corporate Treasurers, National Association of Counties, National Association of Health and Educational Facilities Finance Authorities, National Association of State Auditors, Comptrollers and Treasurers (NASACT), National League of Cities, Property Casualty Insurers Association of America, Retail Industry Leaders Association

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ICI and Money Market Working Group Statements on FSOC Action on Money Market Fund Regulation

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Money Market Funds Since the 2010 Regulatory Reforms: More Transparency, Increased Liquidity, and Lower Credit Risk

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FSOC and Money Market Fund Reform: A Path to Nowhere

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Joint letter from 14 mayors and 39 local business groups

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Money Fund Regs Deserve A Stake Through The Heart

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SEC Commissioner Aguilar Statement Regarding Money Market Funds

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Denver Metro Chamber of Commerce

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Associated Industries of Florida

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Summary of public comment on SEC MMF proposals

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Louisiana Retailers Association

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AFP survey on the negative impact of SEC proposals on MMFs

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County Commissioners Association of Pennsylvania

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Joint letter from County Commissioners’ Association of Ohio and County Treasurers Association of Ohio

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Utah Association of Counties

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New York State Association of Counties

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Treasurer of Safeway testimony before Senate Banking Committee

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State Treasurer of Maryland testimony before Senate Banking Committee

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Associated Oregon Industries

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New Hampshire College University Council

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North Carolina Independent Colleges & Universities

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US Chamber Coalition Letter

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An Open Letter from Charles R. Schwab

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Tennessee Municipal League

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Congress of the United States

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New Jersey Chamber of Commerce

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New Jersey Business & Industry Association

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Greater Raleigh Chamber of Commerce

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North Carolina Chamber

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Associated Industries of Florida

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Florida Chamber of Commerce

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Jacksonville Regional Chamber of Commerce

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Salt Lake Chamber

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Utah League of Cities & Towns

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Utah State Treasurer

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Ralph Becker, Mayor of Salt Lake City

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Greater Pittsburgh Chamber of Commerce

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Greater Boston Chamber of Commerce

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Texas Municipal League

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Greater Providence Chamber of Commerce

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Northern Rhode Island Chamber of Commerce

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Greater Albuquerque Chamber of Commerce

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New Mexico Association of Counties

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Northern Kentucky Chamber of Commerce

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Washington State Treasurer

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Greater Pittsburgh Chamber of Commerce

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Association of Indiana Counties, Inc.

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Proposed SEC Money Market fixes are a bad idea

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Melaine Fein response to Eric Rosengren of the Federal Reserve Bank of Boston

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Chairman & Vice Chairman House Financial Services Committee

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Massachusetts Chamber of Commerce

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Joint letter from American Public Power Association, Council of Development Finance Agencies, Council of Infrastructure Financing Authorities, Government Finance Officers Association, International City/County Management Association, International Municipal Lawyers Association, National Association of Counties, National Association of Health and Educational Facilities Finance Authorities National Association of Local Housing Financing Agencies, National Association of State Auditors, Comptrollers and Treasurers, National Association of State Treasurers, National Council of State Housing Agencies, National League of Cities U.S. Conference of Mayors

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Metropolitan Mayors Caucus

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Association for Financial Professionals

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The Pennsylvania League of Cities and Municipalities

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Congress of the United States

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Indiana Chamber of Commerce

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State and local groups speak out against MMF regulation

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Texas Association of Business

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A Bad Diagnosis Could Be Fatal for Money Market Funds

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Senator Pat Toomey (R-PA)on Proposed Money Market Fund Regulations

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How individual and institutional investors view money market mutual funds and current regulatory proposals designed to change money funds

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The SEC’s Money Market Fund Plans—Scoring a Hat Trick Against Investors and the Economy

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Cincinnati Chamber of Commerce

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Kentucky Chamber of Commerce

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Twenty-three Corporations and Business Groups Tell SEC New MMF Regs Would Hurt Business

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HSBC Research Shows Floating NAV No Safer Than Stable NAV

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The U.S. Chamber of Commerce

“The U.S. Chamber of Commerce (“Chamber”) is the world’s largest business federation representing the interests of over three million companies of every size, sector, and region. The Chamber created the Center for Capital Markets Competitiveness (“CCMC”) to promote a modern and effective regulatory structure for capital markets to drive economic growth and job creation.” – Read more

Washington_State_Treasurer

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United States Senate

“We write to express our concerns about proposals to float the net asset value (NAY) of money market mutual funds (MMMF) or to impose inappropriate bank-like requirements on these funds. It is our understanding that the Securities and Exchange Commission (the Commission) is currently considering such regulatory changes.” – Read more

Financial Services Roundtable

“Money market funds (MMFs) are part of the very core of our financial system. They are an important investment option for millions of retail investors, including retirees and parents saving for college, as well as institutional investors, including corporate and state and local treasurers.” – Read more

New Jersey Association of Counties

“In our view, forcing money market funds to float their NAVs would harm investors, state and local governmental institutions like ours, and the broader U.S. economy. We thus strongly support maintaining the ability of money market funds to offer a stable $1.00 per-share value.” – Read more

Financial Services Institute

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Congressman Scott Garrett (R-NJ-5th), Chairman of the Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises

“Opening statement on June 24, 2011 at a subcommittee hearing to explore the state of the mutual fund industry” – Read more

Financial Executives International

“Floating the NAV may drive up the cost of doing business for many companies. This change could undermine the convenience and simplicity of using money market funds for cash management and instead confront businesses with new tax, accounting, and legal hurdles.” – Read more

Colorado County Treasurers Association comments to the Securities and Exchange Commission

“County treasurers in Colorado are tasked to invest their respective county’s fund portfolio. Colorado state statute is very clear and limiting regarding permissible investment vehicles…One of the tools available is the subject money

market funds.” – Read more

Association for Financial Professionals

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New Mexico Association of Commerce and Industry

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National Association of Corporate Treasurers

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New Jersey State League of Municipalities

“Money market mutual funds play a vital role in the economy, providing local governments, among others, short-term funding and convenient

cash-management.” – Read more

Joint letter of the American Public Power Association, Council of Development Finance Agencies, Council of Infrastructure Financing Authorities, 

Government Finance Officers Association, International City/County Management Association, International Municipal Lawyers Association,

National Association of Counties, National Association of Local Housing Financing Agencies, National Association of State Auditors, Comptrollers and Treasurers, National Association of State Treasurers, National League of Cities, U.S. Conference of Mayors.

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Indiana Chamber of Commerce

“For investors, the stable NAV provides vital benefits.” – Read more

Business Council of New York State

“Our members rely upon money market funds as powerful tools for managing cash…In our view, forcing money market funds to float their NAVs would harm investors, businesses, and the broader U.S. economy.” – Read more

United States Chamber of Commerce

“The Chamber strongly opposes the proposal to abandon the stable per share value. Shifting to a floating net asset value would leave a noticeable void as there are no ready, affordable alternatives to money market funds. Moreover, it would not accomplish the fundamental reform goal of preventing another run …, but rather add risk to the financial system.” – Read more

State of Florida Chief Financial Officer Jeff Atwater

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Rhode Island Economic Development Corporation

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Request for Comment on the President’s Working Group Report on 

Money Market Fund Reform

“On behalf of The Business Council of New York State, a statewide business trade organization representing over 3,000 members in all sectors of our state’s economy, I write to add our voice to those opposing proposals advanced as part of the Report of the President’s Working Group on Financial markets on Money Market Fund Reform Options.” – Read full letter

National Association of Corporate Treasurers

“Mandating a floating NAV would make short-term financing for American business less efficient and more costly, ensuring a severe setback for an economy emerging from recession.”Read full letter

Kentucky State Treasurer

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United States Chamber of Commerce

“Adopting a floating rate NAV would destroy the usefulness of this investment and capital formation vehicle and negatively affect issuers and investors that use money market funds as sources of financing and cash management vehicles.”Read full letter

Dallas Chamber of Commerce

“American business will lose one of its most important sources of short-term funding if money market funds are forced to abandon their stable per-share value.”Read full letter

American Bankers Association

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Cincinnati/Northern Kentucky International Airport

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National League of Cities

“Changing the NAV from fixed to floating would make money market funds far less attractive to investors, thereby limiting the availability for money market funds to purchase municipal securities. Losing this vital investing power could lead to higher debt issuance costs for many state and local governments across the country.”Read full letter

Consumer Federation of America and Fund Democracy

“We strongly oppose these proposals [to require a floating NAV. They present a threat to the continued viability of MMFs [money market funds], which have become an important cash management tool for millions of American households.”Read full letter

AARP

“AARP believes the requirement of floating net asset values would radically and detrimentally alter the role and function of money market funds, discourage the use of money market funds for individual investors, and disrupt the financial market landscape for investors.”Read full letter

Port of Houston Authority

“The Port of Houston Authority has issued commercial paper (CP) in the past, and I am concerned that a shift to floating NAV may impair our ability to raise capital in the CP market in the future and/or increase our costs of short-term financing.”Read full letter

National Association of State Treasurers

“Going to a floating NAV could significantly change investor behaviors (especially for institutional investors) and as a result destabilize financial markets both investors and debt issuers.”Read full letter

New Hampshire State Treasurer

“The New Hampshire Treasury believes that a floating NAV could decrease investor demand and transform the current money market funds into short-term bond funds with its inherent risk, volatility and liquidity problems.”Read full letter

State of Rhode Island General Treasurer

“A floating NAV will likely reduce investment yields as it increase complexity and drives up administrative costs.”Read full letter

Association for Financial Professionals

“The move to a floating NAV would also create significant disruptions in the corporate funding market. Many organizations issue commercial paper to meet their short-term financing needs, such as funding payroll, replenishing inventories, and financing expansion – Should regulators eliminate the stable NAV of MMFs, the resulting reduction in MMF balances would reduce the capital available to purchase commercial paper, making short-term financing for these businesses less efficient and more costly. “Read full letter

Financial Services Institute

“Forcing these funds to float their value would make every money market fund sale a tax-reportable event, substantially increasing tax and recordkeeping burdens. The resulting tax-reporting burden would significantly reduce the attractiveness of money market funds.”Read full letter

American Association of State Colleges and Universities

“Moving to a floating value would eliminate a stable investment tool for state entities restricted by state laws and regulations to using only those investment vehicles that maintain a stable net asset value.”Read full letter

National Association of College and University Business Officers

“Colleges and universities count on the capital that is provided by money market funds to meet their operating and campus facilities requirements. Depending on the market reaction to the loss of a stable NAV investment option, this proposal could alter both the number of investors and the amount of capital that could be invested in debt issued by colleges and universities, potentially raising the cost of capital for our members.”Read full letter