The Fed and the SEC aren't exactly seeing eye to eye at present, and it all has to do with the plan the SEC has devised to cut the risk in the $2.6 trillion money market mutual fund industry.

A major part of the plan rests on introducing withdrawal fees and obstacles to investor redemptions that the SEC says will reduce the risk of investors heading for the doors at times of market stress. Au contraire, say the Fed experts; the fees-and-gates system that the SEC has devised will instead cause "pre-emptive runs," as investors worry more about not being able to access their money during a market tempest than about any fees they might have to pay to get it back before the real storm hits and losses become even greater.

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