C.F.T.C. Proposes Curbs on Speculative Commodity Trading
Regulators on Thursday proposed new curbs on speculative trading in 28 commodities, seeking to prevent distorted prices at the gas pump and in the supermarket.
The commission advanced its plan in a 4-to-1 vote. One of the two Republican commissioners opposed the proposal because she said that the commission first needed to understand how widespread speculative trading had become. The Republican commissioner who voted for the plan, Scott D. O'Malia, said he was "very skeptical" of it.
The commission's proposal for spot-month position limits, or limits on a contract closest to maturity, would prohibit traders from acquiring more than 25 percent of deliverable supply for a given commodity. The CFTCwould then phase in stricter limits over time, once it was able to collect more data on market speculation.
Publication
NY Times blog
Date
January 13, 2011
Cross References (links may require a Cabinet subscription)
Dodd-Frank Act, Title VII, Sec. 737