April 25, 2011
"Remove Rule 2a-7's credit ratings requirements for securities which money market funds may own. Adopted 14 months ago, they stipulate that an "eligible" security (a) have a rating from "requisite NRSROs," or Nationally Recognized Statistical Rating Organizations, in one of the two highest short-term rating categories or (b) be "an unrated security of comparable quality," as determined by a fund's directors. (Ten NRSROs - led by Fitch, Moody's, and Standard & Poor's - are registered with the SEC.)"
"Stop requiring - but don't prohibit - the use of credit ratings when portraying credit quality in shareholder reports such as tables, charts, graphs and management discussions of fund performance".
I take exception to these provision of the proposed changes. In light of the historical performance of the industry, I recommend that the rating agencies be held accountable as well as the fund managers and brokers of Money Market Funds. I favor a highly regulated environment for these funds. I think we all understand that the open stock market, mutual funds, ETFs, are burdened with a level of risk. Cash, held as cash, and uninsured should be highly regulated.
Ivona R. McCrary, CPA
Burt & Company CPAs, LLC
4101 Indian School Road, NE, Suite 440
Albuquerque, NM 87110