Monday, December 22, 2008

As Oil Sinks, U.S. Officials Plan to Fight Speculation

Let's hope Obama follows through on this.

"...lawmakers are emboldened, seeing both the crude-price collapse and the systemic failure of the credit-derivatives market as reason to push ahead with rules to prevent what they call "excessive speculation" in commodity markets."

This is good...

"Even if speculators only had a small impact [on price], that's not right. Our job is to guard against fraud and abuse," said CFTC Commissioner Bart Chilton, a Democratic appointee. "Congress should act expeditiously to prevent the type of excessive speculation and leveraging we have seen."

But this may represent the real attitude:

"The anti-speculation talk may have subsided in the market slide, but its ugly head is likely to rise again," said Greg Mocek, a former head of enforcement at the Commodity Futures Trading Commission, now a partner at law firm McDermott Will & Emery in Washington.

And Gary Gensler, Obama's CFTC Chairman, is a former Goldman Sachs partner, which makes it hard to imagine he is going to crack down on speculation.

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