From a legal standpoint, the most interesting aspect of the case was the holding that, under the "" (who remembers this "orange grove case" from law school?), the general partnership interests were "securities," since the investors were expecting not to take part in the management of the business, but to rely on the efforts of the sponsors of the joint venture.

Here are four other factors that greatly affect the financial industry in general, and CFTC-regulated entities in particular: (i) the costs of regulation, (ii) the pace of regulatory change, (iii) declines in liquidity and cross-border markets caused by regulation, and (iv) uncertainty about the imminence and outcome of regulatory enforcement actions based on ambiguous trading requirements. Those might not be the most impactful factors, but they certainly are worth Commissioner Bowen's…

Governor Tarullo pursued an expansionary regulatory philosophy. He believed that financial market participants fell into two categories: banks that were at least indirectly regulated by the Federal Reserve Board, and shadow banks that were improperly avoiding regulation by the Board. (See ; .) Throughout his tenure, Governor Tarullo seemed to be oddly hostile to the securities financing markets and largely indifferent to declines in liquidity in the financial markets. …