July 10, 2013
July 10, 2013
Secretary, Securities and Exchange Commission
100 F Street, NE
Dear Elizabeth Murphy:
I am writing in strong opposition to the proposal put forth by the Securities and Exchange Commission to force prime and tax-exempt institutional money market funds to abandon the stable $1.00 net asset value and "float" their per-share price (the "floating NAV").
Cash is the lifeblood of a business. My company, like others, carefully manages its cash—season to season and day to day. We use money market funds (MMFs) as the most flexible way to invest and accumulate cash in anticipation of short-term needs. MMFs provide a current market yield on a diversified, professionally managed, fully disclosed portfolio. The convenience and simplicity of MMFs—based on their stable share price—make these funds useful for our cash management.
The SEC's floating NAV proposal, if implemented, would diminish businesses' choices as investors, without achieving regulators' goals of improving the stability of financial system. Thus, forcing MMFs to float would provide no benefit while making it harder for my business and others to manage cash.
MMFs have a 40-year record of stability. New regulations since the financial crisis have made these funds stronger and more resilient. I urge the SEC not to implement a floating NAV which could undermine my business's use of such a vital investment tool.
Michael K. Karry