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WSJ Letter to the Editor: 'Breaking the Buck' and the Regulation of Money Funds

Unlike the credit activities of some regulated banks, these funds do not trade in and out of speculative securities. And, unlike regulated banks making long-term loans of all types using equity leveraged with taxpayer-backed deposits, money-market mutual funds invest 100% of shareholder equity into high-grade credits that mature in days, not years.

Corporate and individual investors in these funds are aware that their yields do not reflect the existence of a federal government guarantee, and prospectus disclosures on this point are clear.

A floating NAV, which the Journal's Money and Investing section called the "nuclear option," would not even address its advocates' putative concerns and would reposition more investor dollars into taxpayer-insured banks with a failure rate hundreds of times greater than money-market funds.

Paul S. Atkins

Washington

Mr. Atkins was a SEC commissioner from 2002 to 2008.

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