It's been a bumpy, generally negative, ride for commodities in 2011. This has been particularly true for crude oil and gold, both getting whipsawed by investor sentiment and wild shifts in mood regarding the global economy. Black gold is traditionally a proxy for global growth whereas gold is a place investors turn in times of economic strife.

With both gold and crude well off their highs, the question facing investors is whether buyers are getting a value or catching a falling knife.

WTI Crude peaked at about $114 in late April, before dropping to just over $75 earlier this month. Along the way black gold recorded its worst quarter in 3 years. What happened? Not shockingly, evidence points first to slowing growth, not just in the U.S. but China and emerging nations as well. Remember at the beginning of the year the pace of the economic recovery was in question. By summertime, the debate deepened into whether or not a global recession was unfolding. The price of crude oil behaved accordingly.

The "big elephant in the room" is the European nightmare, according to Ed Meir, senior commodity analyst at MF Global. Meir is in the camp that a European recession will take the world down with it. He says crude prices have been reduced to moving "lockstep" with EU debt crisis developments.

Of course, economic chaos is supposed to play into the hands of gold bugs who regard the barbaric metal as a safe harbor in crazy times. It's a thesis that has held strong when you look at the price of gold year-to-date, which has risen 16%. Latecomers to the gold party haven't been as lucky, at least since August. As equity prices crumbled in August gold ripped to $1,900 before dropping to current levels above $1,600 an ounce.

After mushrooming from essentially zero to more than a trillion dollars in assets in the U.S., exchange traded funds, or ETFs, have gone from obscurity to being a household name in little over a decade. With over 1,000 different products to choose from, and new ones frequently hitting the marketplace, it comes as no surprise that these cheaper and tradeable alternatives to mutual and index funds now account for a third of daily U.S. trading volume.

It's also not surprising that such a hot growth industry is undergoing unprecedented scrutiny from the Securities and Exchange Commission, Congress, the academic world, as well as from traders and the financial services sector itself. It's a polarizing debate that so far has not slowed the meteoric rise of ETFs, but testimony given Wednesday before a Senate subcommittee seems to have at least nudged the needle towards the side of the regulators.

Even Blackrock (BLK), the world's biggest seller of ETFs, has called upon lawmakers to pursue a re-labeling rule that would redefine leveraged and inverse ETFs, likening them to derivatives for their ability to offer 2 to 3 times the move of a particular index on a given day, as well as the ability to move in the opposite direction.

Testimony was given by Harold Bradley, the chief investment officer of the Kaufman Foundation, that linked leveraged ETFs to distorted market returns and suggested that this was also curtailing IPO activity, thus hampering economic growth. In the attached video clip, Bradley outlines some of the rules he believes must be implemented to ensure the stability of what insiders call market microstructure; but what you and I might call the "plumbing" that keeps our trading systems flowing.