Yep. Say what you will about Dan Rather, but he had an interesting story on this topic earlier this year.
One of the key parts of the story:
Most economists agree that some speculation brings stability to commodity markets. But in an interview with Dan Rather, hedge fund manager Michael Masters claims that a recent surge in speculation has thrown the oil market out of balance making prices at the pump rise and fall at the whim of Wall Street. “Speculators today have about 70 percent of the open interest in the commodity markets,” explains Masters. “Ten years ago-they controlled roughly 30 percent of the market.”
Congress attempted to reign in speculation with the Dodd-Frank Wall Street Reform and Consumer Protection Act. The landmark financial overhaul has a provision that requires federal regulators to restrict how much money speculators can pour into the oil market. But the financial industry has fought back, spending more than $100 million last year lobbying on Capitol Hill. And many of the new rules have been delayed, including the one that limits speculation.
One of the key parts of the story:
Most economists agree that some speculation brings stability to commodity markets. But in an interview with Dan Rather, hedge fund manager Michael Masters claims that a recent surge in speculation has thrown the oil market out of balance making prices at the pump rise and fall at the whim of Wall Street. “Speculators today have about 70 percent of the open interest in the commodity markets,” explains Masters. “Ten years ago-they controlled roughly 30 percent of the market.”
Congress attempted to reign in speculation with the Dodd-Frank Wall Street Reform and Consumer Protection Act. The landmark financial overhaul has a provision that requires federal regulators to restrict how much money speculators can pour into the oil market. But the financial industry has fought back, spending more than $100 million last year lobbying on Capitol Hill. And many of the new rules have been delayed, including the one that limits speculation.
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