CFTC Commissioner Bart Chilton Delivers Speech at 2013 Arkansas State University Agribusiness Conference

CFTC Commissioner Bart Chilton spoke at ASU's Agribusiness Conference, addressing problems in the futures markets due to speculation, technology, and the culture of the financial sector. His speech was a recap of various points that he often makes, though with more of an agricultural focus given the location. Below are two of the Commissioner's main points:

• Commissioner Chilton stated that a primary cause of oil price rises in the summer of 2008 was speculation by "Massive Passives," large pools of managed money such as pension plans, which enter a commodities market and leave their investments there. The Commissioner asserted that large positions by "Massive Passives" increase prices, that are then passed along to consumers. Accordingly, he stated that speculative position limits were needed to limit the positions held by Massive Passives.
• The Commissioner said that the prevalence of high-frequency and high speed trading was imposing increased costs on agribusinesses (because these professional traders are a microsend quicker to hit bids and offers than are the agribusinesses) and that if agribusinesses did not have to compete for trades with faster professional participants in the futures markets, agribusinesses would lower their prices to consumers.

Click here to view speech in full (links externally to CFTC website).