Regulation

The Securities and Exchange Commission’s proposed two- to four-page mutual fund prospectus profiles will only provide investors with the “quick-and-dirty lowdown,” charges Dow Jones columnist Chuck Jaffe. “It seems a bit inappropriate to have investment decisions based on information that can accurately be called ‘quick and dirty,’ rather than ‘thorough and complete,’” Jaffe said.

If investors have learned one thing from the financial crisis, it is that, eventually, level heads and long-term investing will prevail. In that spirit, sister publication Investment Dealers' Digest recently spoke with a man known for having one of the most level heads in the industry, John Bogle, founder of Vanguard Investments, about what he sees for mutual funds and other investment firms in the years ahead.

The financial turmoil in the markets is far from over, and mutual fund firms can expect assets to continue to decline further, investors to remain skittish, and regulators to be reactive well into 2009, experts say.

In a widely anticipated move last week, the Securities and Exchange Commission unanimously approved a requirement for mutual funds to send investors a short-form, summary prospectus.

Treasury Secretary Henry Paulson wants to beef up hedge fund regulation as part of his plan for a systemic risk regulator, he said Thursday.

Reserve Funds has entered into an agreement with the U.S. Treasury’s Temporary Guarantee Agreement Program for Money Market Funds, whereby the Treasury will purchase any outstanding securities in the Reserve U.S. Government Fund not sold by January 3.

In a widely anticipated move Wednesday, the Securities and Exchange Commission unanimously approved a requirement for mutual funds to send investors a short-form, summary prospectus.

The European Union, which has been in favor of new rules and capital requirements for hedge funds and private equity, will propose such regulations next month to the European Commission, Reuters reports.

Testifying before the House Oversight and Government Reform Committee last Thursday on the role of hedge funds in the credit crisis, five prominent hedge fund executives said they would be in favor of establishing a public exchange or clearinghouse for credit default swaps (CDS) to make the market more transparent.

The Securities and Exchange Commission will not revisit 12b-1 fees by the end of the year, Andrew Donohue, director of the division of investment management, told Reuters.