Money market mutual funds have been a source of financial instability from the financial crisis of 2008 through the financial market disruption caused by economic lockdowns related to COVID-19. The President’s Working Group on Financial Markets proposed a set of possible reforms to the MMF industry, and the Securities and Exchange Commission sought public comment on these proposals. CASI faculty co-authored a comment letter on MMF reforms with members of the faculty of the Chicago Booth School of Business, arguing that MMFs should either be regulated as banks or as mutual funds, but should no longer exist as a vehicle to arbitrage both regulatory regimes.
Copyright held by Anat R. Admati, Peter DeMarzo, Eugene Fama, Hanno Lustig, Paul Pfleiderer, Amit Seru, and Luigi Zingales. Further inquiries about reproduction and use should be directed to the Corporations and Society Initiative.
