Posts Tagged ‘commodity futures trading commission’

CFTC’s Bart Chilton On Financial Reform, Position Limits, and Curbing ‘Disruptive Practices’

CFTC’s Bart Chilton On Financial Reform, Position Limits, and Curbing ‘Disruptive Practices’

Courtesy of JESSE’S CAFÉ AMÉRICAIN

Actions will speak much louder than words, especially given the many disappointments in the past from the SEC and CFTC. Position limits are a good idea. Let’s see how long banks like JPM and HSBC have to implement them if they are covered at all. And as for ‘disruptive practices’ in the market, I will be impressed if Goldman Sachs and Citigroup are ever called out for their abusive market practices in the US as they have been in Europe and Asia.

I like Bart Chilton, quite a bit actually. If he delivers on these promises, I will work for him to be elected or appointed to higher office. But after the great disappointment of Obama, it will take actions first to gain my enthusiasm.

I am all for you Bart, but now you must deliver. 

Here is an introduction to this presentation by Bart Chilton from another good guy, GATA’s Chris Powell:

"The member of the U.S. Commodity Futures Trading Commission who has been advocating imposing position limits on traders in the precious metals markets, Bart Chilton, has made a video explaining why he thinks the financial regulation law just enacted by Congress and President Obama promises great progress, particularly in making the commodity markets freer and more transparent. The law, Chilton explains, requires the CFTC to establish position limits and authorizes the commission to prosecute "disruptive trading practices." Chilton says he is especially pleased with that, because the commission’s market manipulation standards have failed almost completely for many years.

Chilton has been amazingly conscientious on the precious metals manipulation issue and has been amazingly responsive to gold and silver investors who have complained to the CFTC about market manipulation. He’ll need their support as the CFTC writes the position limits regulations required by the new law. The big commercial shorts are sure to be heard as the commission continues to take public comment, so gold and silver investors can’t let up yet."


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Manipulating Gold and Silver: A Criminal Naked Short Position that Could Wreck the Economy

Manipulating Gold and Silver: A Criminal Naked Short Position that Could Wreck the Economy

Courtesy of Mark Mitchell at Deep Capture 

Close-up of traditional puppets, Boston, Massachusetts, USA

Everyone from U.S. Senators to prominent hedge fund managers say that criminal naked short sellers had a hand in the financial collapse of 2008, but the regulators aren’t listening. Not a single criminal has been prosecuted. Indeed, the regulators continue to allow the miscreants to manipulate the markets — not just the stock markets, but also the markets for corporate bonds, derivatives, U.S. Treasuries, and all manner of commodities – even when the regulators are provided with indisputable evidence of a massive crime in progress. They could easily fix the flaws in the settlement system that allow much of the manipulation to occur, but they refrain from doing so either because they are too captured by the miscreants or too cowed by the possible consequences of throwing the lights on what may be an enormous confidence game.

So I am inclined to say that it is hopeless. Everyone loves an optimist – but, yes, it is hopeless. We are like the audience in one of those cheesy horror flicks – yell and scream all you like, but the dumb blonde is still going to walk into that room and get hacked to pieces. Except that it is not a movie. It is real. And it’s not just the dumb blonde who is going to get slaughtered. It is all of us. It is our economy. It is our standard of living. It is our financial system – the lifeblood of the nation.

The latest case of regulatory indolence was recently exposed by Andrew Maguire, a successful metals trader and whistleblower who went to the Commodity Futures Trading Commission with data that strongly suggested that a small number of criminal short sellers had rigged the markets for silver and gold. Maguire not only provided the regulators with a Dummies’ guide to how the manipulation generally worked, but also warned them of a specific crime – a dramatic take-down of the gold and silver markets – that he said would occur at an exact time on a specific date in the near future. That is, Maguire told the regulators that a massive crime was about to happen, and the crime happened precisely as he predicted it would.

With Maguire’s warning, the regulators…
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The Warning: Brooksley Born’s Battle With Alan Greenspan, Robert Rubin And Larry Summers

If you missed "The Warning," watch it here, thanks to John. – Ilene

The Warning: Brooksley Born’s Battle With Alan Greenspan, Robert Rubin And Larry Summers

Courtesy of John Carney at Clusterstock

alangreenspan closeup tbiLast night PBS’s Frontline aired a new documentary called The Warning. If you missed it, you are in luck. We’ve got it right here. 

Here’s how Frontline describes the documentary.

"We didn’t truly know the dangers of the market, because it was a dark market," says Brooksley Born, the head of an obscure federal regulatory agency — the Commodity Futures Trading Commission (CFTC) — who not only warned of the potential for economic meltdown in the late 1990s, but also tried to convince the country’s key economic powerbrokers to take actions that could have helped avert the crisis. "They were totally opposed to it," Born says. "That puzzled me. What was it that was in this market that had to be hidden?"

In The Warning, airing Tuesday, Oct. 20, 2009, at 9 P.M. ET on PBS (check local listings), veteran FRONTLINE producer Michael Kirk (Inside the Meltdown, Breaking the Bank) unearths the hidden history of the nation’s worst financial crisis since the Great Depression. At the center of it all he finds Brooksley Born, who speaks for the first time on television about her failed campaign to regulate the secretive, multitrillion-dollar derivatives market whose crash helped trigger the financial collapse in the fall of 2008.

"I didn’t know Brooksley Born," says former SEC Chairman Arthur Levitt, a member of President Clinton’s powerful Working Group on Financial Markets. "I was told that she was irascible, difficult, stubborn, unreasonable." Levitt explains how the other principals of the Working Group — former Fed Chairman Alan Greenspan and former Treasury Secretary Robert Rubin — convinced him that Born’s attempt to regulate the risky derivatives market could lead to financial turmoil, a conclusion he now believes was "clearly a mistake."

Born’s battle behind closed doors was epic, Kirk finds. The members of the President’s Working Group vehemently opposed regulation — especially when proposed by a Washington outsider like Born.

"I walk into Brooksley’s office one day; the blood has drained from her face," says Michael Greenberger, a former top official at the CFTC who worked closely with Born. "She’s hanging up the…
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CFTC to Begin Releasing New Commitments of Traders Reports on US Futures Markets

CFTC to Begin Releasing New Commitments of Traders Reports on US Futures Markets

cftc step in right directionCourtesy of Jesse’s Café Américain 

A step in the right direction for sure.

A much needed enhancement would be to report the five largest position holders in key markets, on the long and short side over a certain size limit on a weekly basis.

Release: 5710-09
For Release: September 2, 2009

CFTC Implements New Transparency Efforts to Promote Market Integrity

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that it will begin implementing new transparency efforts outlined in a July 7, 2009, statement by CFTC Chairman Gary Gensler. Starting Friday, September 4, 2009, the CFTC will begin disaggregating the data in its weekly Commitments of Traders (COT) reports and begin releasing, on a quarterly basis, data collected from an ongoing special call on swap dealers and index traders in the futures markets.

“A core mission of the CFTC is to promote market transparency,” CFTC Chairman Gary Gensler said. “Last September, the CFTC recommended disaggregating our weekly Commitments of Traders reports. In July, I announced that we would also periodically release data on index investors’ participation in the commodity futures markets. I am pleased that as of Friday, September 4, we will be able to take these steps toward increased transparency. For the first time, we will break out managed money and swaps in our COT reports and release information on index investment to give the public a better of view of trading activity in the futures markets.”

Commitments of Traders (COT) Reports

For decades, the CFTC has provided the futures industry with COT reports consisting of aggregated large-trader position data to shed light on the changing composition of the markets. The reports are based on a request by Congress for an annual report, upon passage of original enabling legislation in the 1920’s, and have been intensified over time into weekly reports in several formats and a weekly Commodity Index Supplement for 12 agricultural markets, begun in January 2007.

Beginning Friday, September 4, 2009 (for data as of September 1, the CFTC will publish additional COT data for 22 contract markets, including major agriculture, energy and metals markets. The COT reports currently break traders into two broad categories: commercial and noncommercial. The new reports will improve upon the existing reports by breaking the data into four


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Breaking news: Regulators are (re)discovering that maybe speculation CAN be excessive

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Breaking news: Regulators are (re)discovering that maybe speculation CAN be excessive

BubblesCourtesy of TIME, by Justin Fox writing at the Curious Capitalist Blog

The announcement this morning (pdf!) by Commodity Futures Trading Commission chairman Gary Gensler that his agency is considering imposing limits on the size of trades by energy futures speculators may amount to something of a landmark (or turning point, or whatever portentous phrase you prefer) in Washington’s relationship to financial markets.

Gensler justified the move as part of the CFTC’s duty "to eliminate, diminish or prevent the undue burdens on interstate commerce that may result from excessive speculation." This is a big deal because, for the past 40 years, financial regulators have increasingly gravitated toward the position that speculation can never be excessive. As an official in the Clinton Treasury Department in the late 1990s, in fact, Gensler helped fight off efforts by then-CFTC chairman Brooksley Born to rein in what she felt was excessive speculation in over-the-counter derivatives markets. Yet now here he is proposing new rules to rein in oil and natural gas speculators.

The roots of the benign attitude toward speculation that prevailed in recent decades can be found (among other places I’m sure, but those places aren’t on my bookshelf) in a famous 1953 paper by Milton Friedman on "The Case for Flexible Exchange Rates" (which in turn can be found in his book Essays in Positive Economics). The basic thrust of the paper—that anything but a permanently fixed exchange rate or a free-floating one is inherently destabilizing—still holds up reasonably well. But I’m not so sure about this passage on speculation:

People who argue that speculation is generally destabilizing seldom realize that this is largely equivalent to saying that speculators lose money, since speculation can be destabilizing in general only if speculators on the average sell when the currency is low in price and buy when it is high.

Maybe it’s the "in general" that’s the problem here. On average and over time, the argument may be right. But there are surely extended periods during which price bubbles persist—as in the oil futures market last year—and speculators make lots of money by betting on further price increases, thus destabilizing markets. So Gensler is proposing rules that would


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ValueWalk

The Sharp Rise In Activist Investors In 2020 - New Data released

By Jacob Wolinsky. Originally published at ValueWalk.

Q2 2020 hedge fund letters, conferences and more

Key data shows;

  • Campaigns carried out in H1 2020 shows an overall increase in the number of campaigns, figures look set to substantially top 2019’s total
  • In 2019, the number of campaigns increased significantly to 893 (compared to 655 in 2018). However, successful campaigns dropped by 15% and the number of unsuccessful campaigns increased by 34% (132 unsuccessful campaigns in 2018 to 185 in 2019).
  • Governance is now the new target for activism, and over the past decade, institutional investors have become more active in seek...


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Phil's Favorites

Was coronavirus really in Europe in March 2019?

 

Was coronavirus really in Europe in March 2019?

Courtesy of Claire Crossan, Glasgow Caledonian University

The novel coronavirus – SARS-CoV-2 – may have been in Europe for longer than previously thought. Recent studies have suggested that it was circulating in Italy as early as December 2019. More surprisingly, researchers at the University of Barcelona found traces of the virus when testing untreated wastewater samples dated March 12, 2019.

The study was recently published on a preprint server, medRxiv. The paper is currently being subject to critical review by outside experts in preparation for...



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Biotech/COVID-19

Was coronavirus really in Europe in March 2019?

 

Was coronavirus really in Europe in March 2019?

Courtesy of Claire Crossan, Glasgow Caledonian University

The novel coronavirus – SARS-CoV-2 – may have been in Europe for longer than previously thought. Recent studies have suggested that it was circulating in Italy as early as December 2019. More surprisingly, researchers at the University of Barcelona found traces of the virus when testing untreated wastewater samples dated March 12, 2019.

The study was recently published on a preprint server, medRxiv. The paper is currently being subject to critical review by outside experts in preparation for...



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Zero Hedge

The Sinking Titanic's Great Pumps Finally Fail

Courtesy of Charles Hugh Smith, OfTwoMinds blog

The greater fools still partying in the first-class lounge are in denial that even the greatest, most technologically advanced ship can sink.

On April 14, 1912, the liner Titanic, considered unsinkable due to its watertight compartments and other features, struck a glancing blow against a massive iceberg on that moonless, weirdly calm night. In the early hours of April 15, the great ship broke in half and sank, ending the lives of the majorit...



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Chart School

Dow 2020 Crash Watch - Update

Courtesy of Read the Ticker

Like 1929 the markets have bounced. This time it is on the back of the FED $6.5T money printing.

Previous Post: Dow 2020 Crash Watch 

But can the FED blow $6T every time the market rolls down to test support.

Yes, maybe before the US 2020 elections the FED will do 'what it takes'. But post elections not so much, the year 2021 is a long way from the next election (presidential or congress) and defense of the markets may not be so supportive at $6T or $10T per market smash. The FED may hesitate, and that will be window for stocks to break lower.

The 36 month simple moving a...

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Kimble Charting Solutions

Red Hot China Attempting Key Breakout, Says Joe Friday

Courtesy of Chris Kimble

China ETF (FXI) has been “Red Hot” of late? Is it about to run out of steam or will it remain on fire going forward?

This chart of FXI comes from Investors Business Daily and Marketsmith.com. It reflects that FXI is above key long-term moving averages and its RS ratings is moving sharply higher of late.

Line (1) has been support and resistance several times over the past 3-years. The rally of late has FXI ...



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The Technical Traders

Retail Traders & Investors Squeezed to Buy High-Risk Assets Again

Courtesy of Technical Traders

Yes, we certainly live in interesting times.  This, the last segment of our multi-part article on the current Q2 and Q3 2020 US and global economic expectations, as well as current data points, referencing very real ongoing concerns, we urge you to continue using common sense to help protect your assets and families from what we believe will be a very volatile end to 2020.  If you missed the first two segments of this research article, please take a moment to review them before continuing.

On May 24th, 2020, we published this ...



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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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