The convergence of several events makes this an appropriate time to reassess the impact of the SEC’s 2014 money market fund reforms (the “Reforms”). First, the SEC has released official money market fund (“money fund”) statistics for October 2019, three years after the effective date of the Reforms. Second, total money fund assets are very near $4 trillion, just over $1 trillion higher than they were before the SEC adopted the reforms in July 2014. Third, prime money fund assets are back over $1 trillion. Finally, former Fed Chairman Volcker, an implacable opponent of money funds, recently passed away.
Money funds have demonstrated remarkable resilience in the face of zero interest rates, FSOC activism, and Chairman Volcker’s critiques. What else might we discern from the post-Reform state of money funds.