Comment Text:
Dear Chairman Gensler and fellow Commissioners:
1. Please consider approving the staff’s proposal on position limits, including limiting exemptions to bona fide hedgers.
2. I further request you to readjust the proposed formula in silver. The current formula means over 5,000 contracts for any single speculator, on an all-months-combined basis. 5,000 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.
3. 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.
4. If there is future debate on how limits will be reset in the future as silver volumes change, then I respectfully also ask the following, as an example, be considered.
Future position limits to be set at an equivalent of the median of producers ounces as a mechanism to adjust the limits in an on-going manner. It could be median or some other percentile, but the percentile remains fixed, though numbers of contracts can change with time, such as bi-annually.
5. Please institute a 1500 contract (7.5 million ounce) position limit for silver. This is a vital issue for world-wide perception that markets are not and can not be manipulated.
Respectfully submitted,
Mr P. C. Winch
