No Congressional Action On HFs Any Time Soon

It doesn't appear likely there will be any hedge fund laws either from the U.S. Treasury or from Congress, at least not yet. Randall Quarles, undersecretary for domestic finance at the U.S. Treasury, told a conference last week that any new HF rules must be "carefully considered," and done after Treasury is "as fully informed as we can be." So far, even with announcements earlier this year that Treasury was focusing on hedge funds, "To date, we haven't seen evidence that change is necessary," Quarles said, but quickly adding that "enough time has passed" since the last time the department examined the industry to warrant a new round of study. With all other pressing issues before it, however, Congress may be in no hurry to tackle this issue. "At this point, I haven't seen any particular proposal for that which has support," Quarles said, but that could change as "headline developments" will bring it to the table more quickly than any particular systemic need. Meanwhile, the Securities and Exchange Commission is preparing to meet with the President's Working Group, consisting of regulators and government agencies, to decide how to proceed after the demise of the agency's hedge fund registration rule.