The approach that regulators have taken since the report of the president's working group after the LTCM crisis has been a market-based approach, an indirect regulation approach, whereby we put a lot of weight on good risk management by the counter-parties to the hedge funds, such as the prime dealers, the lenders, as well as the good oversight of the investors, the institutions and so on that invest in hedge funds.
And we found that that's a very useful way to control leverage and to provide market discipline on those funds.
The original report of the president's working group also suggested disclosures, and that never went anywhere in Congress. And I think part of the problem was it was difficult to agree upon what should be disclosed and what would be useful.
The hedge funds are naturally reluctant to disclose proprietary information about their trading strategies and approaches, and their positions change very quickly, and so therefore position information can be overwhelming and perhaps not very useful. I think it's important to continue to think about hedge funds.
They certainly play an important role in our financial system. Exactly what a disclosure regime would look like, though, is not yet clear to me how that best would be organized.