A Basel Committee study estimates that there will be net positive benefits from Basel III because of the reduced probability of a crisis and reduced volatility in output in response to a shock.
And to be sure, many mutual funds have remained untainted by the scandal, and some of them received a disproportionate share of the new cash invested in mutual funds in recent months. But mutual funds have maintained their position in U.S. families’ portfolios primarily because they continue to offer low-cost access to highly liquid, diversified portfolios.