By Ross Kerber
A senior Federal Reserve official is prescribing sweeping medicine to stabilize the $2.5 trillion money market mutual fund industry, which would be rattled by potential downgrades of the government securities that are among its key holdings.
Boston Federal Reserve President Eric Rosengren told Reuters that a “combination” of solutions will be needed to reduce the risks faced by the short-term funds and their investors — including one resisted by many fund marketers that would no longer fix the net asset value (NAV) of a fund share at $1.
