Regulatory Storm Brewing for Futures Industry?

As we sip our coffees, let's take a look at the brewing regulatory storm for the futures industry in 2010. The year kicked off with a bang, or rather, a series of proposed changes that kept the House and Senate busy bandying about countless bills regulating over-the-counter (OTC) derivatives. Newly sworn-in CFTC chairman Gary Gensler testified before Congress seven times from June through October, signaling a shift in regulatory winds.

The climax of this regulatory saga was the passage of the Wall Street Reform and Consumer Protection Act of 2009 by the House on December 11. This act mandates that all standardized swap transactions between dealers and major swap participants be cleared and traded on an exchange or electronic platform. So, buckle up, futures traders. Regulatory reform is sure to keep you on your toes in 2010.

From BYOB to Aussie Holiday Cheer

While the U.S. was busy with regulatory reform, party planning took a somber turn stateside. The number of firms holding holiday parties dropped from 77% in 2008 to 62% in 2009, according to Challenger, Gray and Christmas Inc. It seems the "bring your own booze" (BYOB) approach was more popular than ever.

Meanwhile, across the globe, Australian companies were gearing up for a different kind of cheer. IBIS World forecasts that holiday parties will increase from 67% in 2008 to 92% in 2009 Down Under, with companies expected to spend around 560 million Aussie dollars on year-end events. It seems the party spirit was alive and well... just not in the U.S.

PhD in Financial Journalism?

In an unexpected twist, former Lehman executive Lennie Fuller is reportedly considering creating a Ph.D. track for financial journalism at the University of Stirling in Scotland. While we don't know the role he played in Lehman's troubles, it seems there were plenty of qualified accountants on their roster. Could this be a sign of things to come for finance journalism? Only time will tell.

Tops and Bottoms of 2009

As we look back at the tops and bottoms of 2009, several key figures came under scrutiny. Richard Rubin, an economic stalwart of the Clinton Administration and Goldman Sachs alum, left Citigroup with a diminished reputation. Meanwhile, former Merrill Lynch CEO John Thain managed to redecorate his office (including an $87K area rug) and pass out $5.8 billion in bonuses before being shown the door by BofA CEO Ken Lewis.

Investment Implications: From iShares Barclays 20+ Year Treasury ETF (IEF) to United States Natural Gas Fund (UNG)

The regulatory storm brewing could have implications for investors across various assets. For instance, increased scrutiny on derivatives could impact the way traders approach iShares Barclays 20+ Year Treasury ETF (IEF), which has significant exposure to interest rate risk. On the other hand, energy traders might find opportunities in United States Natural Gas Fund (UNG) as regulatory changes could affect natural gas trading.

Investors should also keep an eye on financials like Goldman Sachs (GS). As one of the firms most impacted by regulatory reform, GS's fortunes could be tied to how these reforms play out. Emerging markets might also present opportunities or risks, depending on how individual countries navigate their own regulatory landscapes. The iShares MSCI Emerging Markets ETF (EEM) could provide exposure to this broad trend.

Navigating the Storm

So, what should investors do differently in this regulatory storm? First and foremost, stay informed. Keep an eye on proposed regulations, as they could impact your portfolio's risk profile. Diversify your portfolio across asset classes to mitigate risks associated with regulatory changes. And finally, consider seeking professional advice tailored to your specific investment goals.