Treasury to protect money market funds

Sep 19, 2008 @ 9:30 am

By Sue Asci

The Department of the Treasury announced today that for the next year, it will insure the holdings of any publicly offered eligible money market mutual fund that pays a fee to participate in the program.

The agency received approval from President Bush to use the assets of the Exchange Stabilization Fund.

The program may use up to $50 billion to guarantee the funds.

“Concerns about the net asset value of money market funds’ falling below $1 have exacerbated global financial market turmoil and caused severe liquidity strains in world markets,” the Treasury Department wrote in a statement.

Under the program, if a fund’s net asset value falls below $1, it will be notified that it has triggered the insurance program.

The Exchange Stabilization Fund was established by the Gold Reserve Act of 1934.

The act allows the secretary of the Treasury, with approval from the president, to “deal in gold, foreign exchange and other instruments of credit and securities” to promote international financial stability.

0
Comments

What do you think?

View comments

Most watched

INTV

Young advisers envision a radically different business in five years

Fintech and sustainable investing are two factors being watched closely by some of the 2019 class of InvestmentNews' 40 Under 40.

INTV

Young professionals see lots of opportunity to reinvent the advice experience

Members of the 2019 InvestmentNews class of 40 Under 40 have strategies to overcome the challenges of being young in a mature industry.

Latest news & opinion

New Jersey fiduciary rule: Pressure leads to public hearing, comment deadline extension

Industry push results in chance to air grievances on July 17 and another month to present objections.

InvestmentNews' 2019 class of 40 Under 40

Our 40 Under 40 project, now in its sixth year, highlights young talent in the financial advice industry. These individuals illustrate the tremendous potential of those coming up in the profession. These stories will surprise, entertain, educate and inspire.

Galvin to propose fiduciary rule for Massachusetts brokers

The secretary of the commonwealth is proposing a fiduciary standard in response to an SEC investment-advice rule he views as too weak.

Summer reading recommendations from financial advisers

Here are some books that will keep you informed and entertained during summer's downtime

4 strategies for Roth conversions

There's never been a better time to do a Roth conversion, and here are several ways to go about it.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print