Useless Financial Regulation, Part 2

I mentioned a few days ago that government watchdogs never quite prevent what they are supposed to do.

They never stop real frauds despite the effort, but produce lots of meaningless data at business and taxpayer expense. The only genuine benefits accrue to politicians who take credit for the passage of legislation.

I mentioned, for example, the reams of meaningless mutual fund folders, prospectus material and proxies that often wind up in wastepaper baskets unread. They could all be put on a couple of sheets of paper instead. And probably still not be considered important enough by the public to read.

And I spoke only of mutual funds.

The SEC has now come up with more pap that has no investor protective value. It would make money market funds tell the actual net per share value about once each month, instead of the daily $1 per share used when the investor writes checks on his account. The difference could be about $1.002 a share or $.99.97 a share, instead of the $1.00 actually and officially employed, at no cost to the investor.

In other words, no real risk difference, except to add a psychological downbeat to the financial transaction. Dismal governmental regulation during this recessionary climate. To remind the financial world that one speculating money fund last year did get into trouble in the money market.

Another instance of the SEC acting like a bull in the china shop. And the fact that our regulators are truly fallible and ought not to be so powerful as the Obama administration wants them to be.