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Kai Ryssdal: Today's proposals came as no surprise to the industry they would affect most. Congress has been talking about tightening up on the shadow banking system for a while now. Of course just because bankers know what's coming doesn't mean they have to like it. Marketplace's Jeremy Hobson has more on the industry's reaction from New York.

JEREMY HOBSON: Let's start with hedge funds. Right now, they're not required to register with the government. That's one thing that's almost certain to change. And Steve Thel, who teaches securities regulation at Fordham Law School, says the industry expects that.

STEVE THEL: I don't think they're throwing up their hands and saying do whatever you want. I think if the proposals were for aggressive regulation of their internal operations they'd be very upset. But right now, the kind of regulation that's on the horizon for hedge funds is largely this kind of registration for the advisors.

When it comes to other steps the government might take, the industry is offering its own ideas. Nonbinding, of course. The Managed Funds Association has for years offered a best practices guide for Hedge Funds. But Adam Lerrick of the American Enterprise Institute says try as they might to push for self regulation, it'll be hard to stop this train.

ADAM LERRICK: The hedge-fund industry and the private-equity industry clearly do not want to be regulated. At this point, I think what they're trying to do is just minimize the damage that it could cause.

Bob Pickel is the CEO of the International Swaps and Derivatives Association. He's still combing through the details, but he says he doesn't want the derivatives industry to be singled out for tougher regulation.

BOB PICKEl: Whatever your view may be about credit-default swaps in the current financial crisis, I think everyone has to acknowledge that other derivatives have performed well.

Pickel says he'll be meeting with members and hopes to help shape comprehensive financial reform.

In New York, I'm Jeremy Hobson for Marketplace.