Comment Text:
While many factors contribute to today’s highly volatile commodity prices, it is clear that excessive speculation is partially responsible. This has been conclusively shown in studies by members of respected institutions such as Princeton, MIT, Citigroup, the Petersen Institute, the University of London, Yale, UNCTAD, the FAO, and the U.S. Senate. I congratulate the Commission on its efforts to enforce the Dodd-Frank Financial Reform Act and urge it to implement the proposed rules regarding aggregate speculative position limits to prevent excessive speculation. At this time of fragile economic recovery, we cannot allow speculators to unduly affect our food and energy prices. Congress called for exemptions from these limits for bona fide hedgers. I ask that the Commission define that term in the strictest sense possible, limiting exemptions to businesses that deal in physical commodities and use markets to hedge commercial risk in those commodities. Banks, hedge funds, private equity and all passive investors in commodities should not be deemed as bona fide hedgers. Institutions hedging price directional bets such as commodity index swaps, Exchange Traded Funds and Exchange Traded Notes also should not be considered as bona fide hedgers.
