Comment Text:
I urge you to approve the staff’s proposal on position limits. However, I would strongly suggest that the proposed formula in silver be reduced. The current formula would result in a position limit of over 5,000 contracts for any single speculator. Five thousand contracts is the equivalent of 25 million ounces of silver. This is too high of a threshold in light of the realities of the world silver market, i.e., there are only 3 mining companies in the world that produce more than 25 million ounces of silver per year and only a similar number of industrial consumers use more than that amount. Any speculator holding an amount of silver derivatives greater than what 99% of the world’s silver producers and consumers make or use in a year would have inordinate pricing power. The purpose of speculative position limits is to prevent such a circumstance.
Please institute a 1500 contract (7.5 million ounce) position limit for silver.
