Among those calling for tighter money market fund regulations, one analyst says the Financial Stability Oversight Council's action (or lack thereof) on the matter will be a test of Dodd-Frank's effectiveness.

"For Dodd-Frank to reduce the risk of the next systemic crisis, regulators must be willing to make politically unpopular decisions based on incomplete and conflicting information," writes Jaret Seiberg of Guggenheim Partners in a note. "If regulators fail to act, the Financial Stability Oversight Council must be willing to step in."

Securities and Exchange Commission Chairman Mary Schapiro has been pushing for changes to the funds and "a slew of top regulators including Federal Reserve Chairman Ben Bernanke and Treasury Secretary Timothy Geithner have said money-market funds, which weren't addressed in Dodd-Frank, are a threat to financial stability," says the Wall Street Journal's coverage of the note.

But Seiberg takes a dim view and doesn’t think the FSOC is going to move quickly. This prediction is "why we believe investors should not give credit to Dodd-Frank reducing the risk of a systemic crisis" writes Jaret.

For the full piece see "Money Funds Test Effectiveness of Dodd-Frank" (may require subscription).