At the ICI's 10th annual Equity Fixed-Income and Derivatives Markets Conference at the Grand Hyatt in New York on Monday, president and CEO Paul Schott Stevens discussed the trade group's role in September's money market crisis.

Stevens said that when the first cracks emerged in the credit markets over a year ago, the ICI began regular communication with the Fed, the Treasury and the SEC to keep them abreast of the issues that members were experiencing as a result. Talks, he said, accelerated early in September. The talks became round the clock even before The Reserve's announcement that its fund had broken the buck.

Addressing the problems that bank lobbyists have raised about the Treasury's guarantee to money market market funds, Stevens said that the lobbyists "would have you believe that the money-fund guarantee was devised a means of sweeping deposits out of their vaults."

Countering that statement, Stevens said that the ICI actually suggested an later deadline for covered investors which was in line with what the lobbyists wanted. "When we proposed a September 19 cap to Treasury officials, they were surprised. When those officials shared our recommendation with bank lobbyists, they were stunned."

Stevens wrapped up his presentation with a message of hope for those in the fund industry.

"We are no strangers to crisis, given our 70-year history," he said. "And I'm certain of this: just as in the past whatever damage the fund industry sustains, we will emerge from the current crisis as the indispensable tool for millions of average investors to participate in global securities markets."  

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