On the cusp of a new year, resolutions are made but typically soon broken. After the ride the financial services industry took in 2007, here’s hoping that the spirit of self-improvement proves a little more robust in the year ahead.

For investors, let 2008 be the year that they stop buying investment products they don’t understand. If we have learned anything from the credit crunch, it’s that if a product is hopelessly complex, run, don’t walk, in the other direction — no matter what return is promised or who is vouching for its quality.

Amazingly, this is a resolution that institutional investors (fund managers and corporate investment managers) need as much as retail investors.

Banks and other financial institutions that have been whacked by the credit crunch have hopefully learned that their risk-management models are always limited — black swans do exist. Unusual, unpredictable market events are themselves predictable occurrences.

Therefore, risk-management models can only go so far. At some point, common sense also has to play a part. As with investors, if the returns seem too good for the risk being taken, they probably are. Banks should resolve to remember that a spotless reputation is invaluable and, in the long run, it’s probably better to forgo inexplicably rich returns.

Policy-makers have plenty to keep in mind for the coming year, too. They need to recognize the potentially far-reaching implications of seemingly mundane retail investor issues. At the heart of the U.S. subprime meltdown are borrowers who received loans they couldn’t afford, on terms they probably didn’t understand.

Regulators must resolve to remember this when they are making rules on things such as point-of-sale disclosure. Our industry will oppose almost any sort of disclosure as too costly and inconvenient. Yet, when the fundamental principle of full disclosure is sacrificed in the name of expediency, otherwise preventable calamities will inevitably develop.

Unfortunately, many of these lessons will probably not be learned. As with New Year’s resolutions, they will be remembered for a while but ultimately forgotten — just in time for the next great product to come along and persuade everyone that the old rules just don’t apply. Still, here’s hoping this time will be different.