He writes:
Barron’s makes the observation that the new SEC rules for money-market funds might lead to as much as a $500 billion cash exodus.
To which I say, that is a good start.Yeah, really great. Create more chaos in financial markets and destroy the sector that comes closest to 100% reserve banking, in order to drive more money into elitist establishment banks. Perfect, real perfect.
-RW
This one gets a little messy. The 2008-2010(?) bailouts were driven in important part by love for threatened money market funds as well as bankers. Money market fund accounting carries a scent of 'pretending that risky things aren't risky,' a good formula for bailouts. Not that bank deposits are immune from pretend accounting, either. A bird in the hand is worth two in the bush, but on the balance sheet, 'cash on hand' sleeps together with 'cash in the bank,' in the same account, and at the same value. This treatment dates in important part to two influential accounting texts written right on the heels of the Panic of 1907.
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