Published : 13 years ago, on 10/05/2012

Every economy across the globe is experiencing a major shift from being a timid community to attaining a larger portfolio. With enhanced activity in the finance segment has arisen the need to control the risks accompanying its management.
Different nations and their governments have passed various financial reforms in order to organize and stabilize its financial community. One of the world’s strongest economies, the US, has faced various financial reforms. These reforms are enacted by the bills passed by a political party prevailing in that country.
Financial reforms are there to be adhered by the banks and other financial institutions to fight against a volatile market during crisis. On the other hand, forex trading works on a global scale and its repercussions are widespread (among the entire investor community participating in forex trading).
As far as the bill passed by the US congress is concerned, it encourages the establishment of an independent consumer bureau within the Federal Reserve. A regular habit observed in borrowers is the predatory lending practice which is considered one of the main reasons of the world financial crisis. There are various large banking firms which face troubled situations and this bill authorises such banks to be shut down. The forex market enjoys a solitary existence and is not impacted by the various activities happening in the financial forum incorporated by financial regulatory authorities.
The US President Barrack Obama has also pointed out in one of his speeches, “Protect consumers and lay the foundations for a stronger and safer financial system, one that is innovative, creative, competitive, and far less prone to panic and collapse.”
All these directive principles and policies are aimed at bringing the national economic situation in to a stable platform, allowing more liquidity and controlling the volatility in the financial market. However, the forex analysis remains unaffected by such norms, or regulations. The factor affecting the forex market is the valuation of dollar (as US).
The reforms are basically dependent on the role of tax payer.  Also, the investor inclined towards riskier investments can also have an adverse effect on the financial markets. The federal government and their offices, in future, will also keep an eye on the performance of derivative instruments such as options, reits, sivs etc.
Even though, the new bill is passed by the US congress, but the liberal and conservative parties have voiced out their opinion against this bill equally. According to the liberals, the bill needs to be more aggressive in nature, and the conservatives feel that the bill creates an expansion in the government structure and that the tax payers will face difficulties while getting corporate bail outs in the future.