Fed Researchers Argue Against SEC Money Market Reforms
When the Securities and Exchange Commission finalized its new Money Market Fund rules last month, it explained that fund managers have the option to impose liquidity fees and temporary gates when liquidity fell below a certain point to halt redemptions and prevent the ‘first-mover advantage’ from driving a run on the fund. But Federal Reserve Bank of New York researchers Marco Cipriani, Antoine Martin and Patrick McCabe along with University of Padua economics professor Bruno Parigi argue that this simply increases stability by forcing informed investors to make . . .
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