Yesterday the Wall Street Journal published a teaser article about oil trading during the speculative bubble of 2008. The WSJ reveals few details except to note that Goldman Sachs and big hedge funds drove up the price of commodities. The data was obtained from Senator Bernie Sanders (Socialist - Vermont).
This comes on the heals of the publication by the Commodity Futures Trading Commission (CFTC) of "large trader directional data," as promised by Commissioner Gary Gensler. The commissioner promised the data a month ago while noting that recent purely speculative positions (people who never take physical delivery of a given commodity) were up to 88% of oil and grain markets. This of course runs counter to the claims by hedge funds and banks that they either do not speculate, or that it's a small portion of the market and provides "needed liquidity."
My guess is Sanders believed the CFTC publication would be a significant revelation and that Gensler would make a big deal about it. I found the data on the website - not exactly out front in blinking lights! - and it's useless. There are no names and it covers a three year period of time where prices fluctuated wildly. For the most part it evens out. The report is a total whitewash.
Large trader data is confidential, but once it is produced to congress apparently all bets are off. Sanders is on the committee that requested the data from CFTC, and the leak is clearly a shot across the bow, threatening that the CFTC should re-think using the Dodd-Frank legislation to put up more smoke and mirrors.
But how sad is it that an outright socialist is - completely on his own - taking this stand? Where are all the Dems and Repubs who constantly seek out cameras to wax poetic about standing up for the little guy, and against commodity price speculation?
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