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Paulson On Money Fund Reform

Former Treasury Secretary Henry Paulson has weighed in with advice for SEC Chairman Schapiro on money-market fund proposed reforms.  His letter to the Chairman provides excerpts from his book "On the Brink," which detailed his experiences in September 2008.  In Paulson's view, the expectation of money fund investors of "complete liquidity with no fear of loss is a problem that should be addressed."  He notes that the SEC has taken steps to enhance disclosure of the fact that money funds "are investment products, not guaranteed accounts," but he believes more can be done.  Paulson suggests that a move to a floating NAV would provide investors with a "tangible indication" that they are not investing in a bank account.

Paulson urges Chairman Schapiro to use his letter "in any way which helps you secure this important reform."

Mr. Paulson's letter to the SEC can be found here: