Comment Text:
Dear Chairman Gensler and Commissioners:
I urge approval of the staff’s proposal on position limits, including limiting exemptions to bona fide hedgers, but readjusting the proposed formula in silver. The current formula - resulting in a position limit of over 5,000 contracts for any single speculator, on an all-months-combined basis is the equivalent of 25 million ounces of silver, way too high in light of the realities of the world silver market.
There are only three mining companies in the world who produce more than 25 million ounces of silver per year and only a similar number of industrial consumers using 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, consider a 1500 contract (7.5 million ounce) position limit for silver, perhaps even lower at 1,000 contracts (5 million ounces).
The purpose of limits is to reflect real options in the marketplace, not fuel pure speculation.
Sincerely Yours, Paul Kiernan
