For those who missed the fine print in yesterday's CFTC ruling on position limits in commodities, the CFTC has included exemptions for unnamed traders (cough, Blythe).
Senator Bernie Sanders is none too pleased with the CFTC's inclusion of exemptions for big banks.
Now if only the CFTC could get things right and pass position limits of 5 contracts per evil speculator for the oil and natural gas markets, and 5 Quadrillion contracts per important "hedger" in the evil silver market...all would be well.
Bernie Sanders 10/17/11:
It is my understanding that your current proposal contains major loopholes to allow Goldman Sachs, Morgan Stanley, and other major financial institutions to receive bona-fide hedging exemptions so that they would not have to abide by the positions limit rule.
This is simply unacceptable and has got to change...
It is my understanding that under your current proposal, aggregate position limits would not go into effect until mid to late 2013 at the earliest to allow the CFTC to collect more data on the over the counter derivatives market.
Double speculative margin requirements to require speculators to back their bets with real capital. Increasing margin requirements in the silver market to 12% earlier this year caused silver prices to drop by 27%. The same can and should be done for crude oil, heating oil, gasoline, diesel fuel, and jet fuel.
We are sure Mr. Sanders will follow up this letter with a request to double speculative margin requirements in T-bonds as well in an effort to drop prices by 27%.
We wonder if Mr. Sanders is aware that were the CFTC to close the exemptions and loopholes in position limits for the big banks that silver would soar much higher than the 27% it crashed from manipulative margin hikes in May?
Bernie's full letter to the CFTC can be found here:
