Targeting Speculators, Again
Written by Brian Garst, Posted in Energy and the Environment, Free Markets
The democrats are dusting off an old enemy to trot out as part of their perpetual government circus act. Oil speculators, come on down!
The Obama administration is also proposing an overhaul of financial regulation that would include tougher capital requirements for big banks, tighter regulation of hedge funds and a new consumer protection agency with broad power to regulate credit cards, mortgages and other consumer lending.
In the case of oil and gas trading, regulators made it clear that they were willing to move, without waiting for Congress to act on Mr. Obama’s overhaul, invoking their existing powers.
The Commodity Futures Trading Commission said it would consider imposing volume limits on trading of energy futures by purely financial investors and that it already has adopted tougher information requirements aimed at identifying the role of hedge funds and traders who swap contracts outside of regulated exchanges like the New York Mercantile Exchange.
It’s not just democrats in on the act, this time. Gordon Brown and Nicolas Sarkozy teamed up on the pages of the WSJ to call for more government when it comes to oil prices. This line of attack is based on pure economic ignorance. I’ve responded to it in the past, so this time I’ll just point you to some bigger authorities than myself.
Reason Magazine: Rant: Burn the “Speculators”!
Cafe Hayek: A Win-Win and Oily Speculations
Robert P. Murphy: Oil Speculators: Bad or Good
I serve as Vice President of the Center for Freedom and Prosperity, a non-profit think tank dedicated to preserving tax competition and free markets. This site features my personal views, which are not reflective of CF&P.