Let me say that during today's call, we may make forward-looking statements. And we want to note that Federated's actual results may be materially different than the results implied by such statements. We invite you to review the risk disclosures in our SEC filings. No assurance can be given as to future results, and Federated assumes no duty to update any of these forward-looking statements. And with that, I'll turn it over to Chris.John Christopher Donahue Thank you, Ray, and good morning. I will be begin with a brief review of Federated's recent business performance before turning over the call to Tom to discuss our financials. Looking first at cash management. Average money market fund assets were down $8 billion from the prior quarter, while the quarter end totals decreased by $7 billion to $239 billion. The second quarter has some seasonality from tax payments in both April and in June, and our market share remains over 9%. The impact of yield-related fee waivers decreased again in the second quarter, and Tom will cover this in more detail later. Regarding the market share, it's interesting just to look at the history, where it is running at about 9.5% today. At the end of '11, it was running at about 9.4%, 8.7% at the end of '10, 8.5% in '09 and '08, and about 7% in '07, and 5% in 2000. On the regulatory front, it has been reported that a document outlining new money market fund regulations has been circulated by the SEC Chairman to the other commissioners. While the proposal is not publicly available, prior comments from the Chairman indicate that the proposal includes the choice of floating the NAV or imposing redemption restrictions on money funds, in combination with the capital requirement at the fund level. These ideas have been previously floated and even in their discussion form, they have drawn extensive negative reaction and commentary from money fund investors, issuers, businesses, state and local municipal finance authorities, various members of Congress, U.S. Chamber of Commerce, the ICI, and individual money fund management companies. The reason is it's because it's very poor policy.
I have previously covered these proposals and won't go into a lot of detail today, except to say that so far as they violate the primary tenants of a money fund, daily liquidity at par with a market yield, they will end money markets funds as we know them if they are proposed and enacted. The consequences will be severe, including higher funding costs for states municipalities and other government entities, leading to either higher taxes, cuts and services or more money moving into the largest already too-big-to-fail banks, and money moving to far less transparent unless regulated investments including separate accounts, offshore accounts and things perhaps we have not even thought of.These Draconian measures are based on demonstrably false premise the money funds are prone to destabilizing runs and somehow backed by the taxpayers. There's no proof that either of these ideas is true. There is, however, the unparalleled 40-year record of successful money management providing real tangible benefits to our financial system. So again, we advocate the regulator study the positive impact of the 2010 Rule 2a-7 amendments and conduct a thorough and rigorous cost-benefit analysis of any further money fund regulations. The facts will then show that further rules are not necessary and, in fact, are likely to do serious harm to our financial system. Now turning to our equities business. Reflecting industry and market trends, equity fund gross sales decreased from the levels of the last couple of quarters, while redemptions also decreased, net flows were modestly negative. We continue to see demand for income products, particularly the strategic value dividend and capital income strategies, each showing positive fund flows. Our international equity funds also had positive flows with good results from international leaders and international strategic dividend fund. The Kaufmann Large Cap Fund moved into positive flows for the second quarter.
At the end of the second quarter, we had 8 equity strategies and a variety of styles, with top quintile -- top quartile 3-year records and 6 in that top quartile for 1 year. And this include funds like the capital income, Pru Bear, InterContinental and Strategic Value Dividend.Equity fund net flows are essentially break-even for the first 3 weeks of July, and much of the improvement is due to the Kaufmann Small Cap Fund moving from negative flows in the second quarter to positive flows early in the third quarter. Second quarter flows in equity separate accounts were positive, led by the strategic value strategy. We are continuing to see RFPs for strategic value income, both domestic and international, as well as other strategies and the Clover Small Value equity strategy as well. Read the rest of this transcript for free on seekingalpha.com