The Wall Street Journal reports that the Commodity Futures Trading Commission is considering introducing position limits for “all commodities of finite supply.”
Uhhh…wouldn’t that just be all commodities?
Anyway, let’s get a quote from CFTC Chairman Gary Gensler:
“My firm belief is that we must aggressively use all existing authorities to ensure market integrity.”
Sounds like more government meddling in markets to me…like when Los Federales decided to “crack down on short sellers” when the equity markets were tanking. I’ve read that Gensler is being pressed on by a Senate subcommittee that wants to wipe out “evil commodity speculation.”
What will this mean for commodity traders? One inside source I trust believes that tighter position limits could cause commodity prices to tumble severely…at least in the short term.
So be very, very careful out there, fellow trader. Follow your stops, and let’s keep an eye on this developing story.
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