CFTC ‘considering’ fresh limits on positions

Dear Friend of GATA and Gold (and Silver):

The good news in the Financial Times story appended here is that the U.S. Commodity Futures Trading Commission may not be done setting position limits in futures markets with especially concentrated positions. The bad news is the suggestion that the commission’s objective is to prevent an increase in commodity prices, not to liberate markets.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

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CFTC ‘Considering’ Fresh Limits on Positions

By Gregory Meyer
Financial Times, London
Tuesday, August 25, 2009

http://www.ft.com/cms/s/0/e0cb1baa-91c1-11de-879d-00144feabdc0.html?ncli…

NEW YORK — The chief US commodity markets watchdog reiterated doubts about whether banks should be free from limits on commodity trading — a prospect that has alarmed Wall Street.

Leading banks such as Goldman Sachs and JPMorgan are exempt from most limits on positions in commodity futures markets so they can manage risks incurred by serving as market makers for clients. The Commodity Futures Trading Commission is to consider whether to strip these and other firms of their exemptions as it mulls blanket federal limits on markets from crude oil to corn.

Pressure to get rid of the exemptions could increase as commodity prices rebound, potentially smothering an economic recovery. US crude oil futures touched a 2009 high of $75 a barrel yesterday.

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