Here they go again in Washington. After holding numerous hearings on all alleged speculation in oil trading and finding no evidence to support this idea, the bureaucrats have decided to restrict the non-existent "speculative trading" anyway.
The CFTC is proposing placing restrictions on share creation of certain commodity ETFs. This would limit the size of the ETFs and almost certainly cause the ETFs to trade at large premiums over the value of their holdings.
The net effect is that small investors who want to trade oil, gold or natural gas will likely be forced to trade futures. There's a great idea from Washington! Force investors to leverage up again after the current economic downturn was caused by excessive leverage! But hey, no problem. We will all now be protected from those non-existent speculators. Heaven forbid Washington take responsibility for their role in this mess. Its much better to find a scapegoat!
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