Comment Text:
We applaud the Commission’s efforts to implement the Dodd-Frank Act as
thoroughly as possible especially reforms aimed at limiting excessive
speculation in food and energy commodities.
While many factors contribute to today’s highly volatile commodity prices,
it is clear that excessive speculation is partially responsible, as shown in
dozens of studies by members of respected institutions such as Princeton,
MIT, Citigroup, Petersen Institute, University of London, Yale, UNCTAD, FAO,
and the U.S. Senate.
We urge the Commission 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.
Thank you for your consideration.
