Congress have moved to regulate previously unregulated electronic exchanges. Woopee.
“We are bringing sunlight to these dark markets,” Senator Charles Schumer, a New York Democrat, said at a press conference today in Washington.
Good luck finding me a state with 2 Senators that I hate more than New York’s.
Congressional action comes in a year of record prices for crude oil futures contracts, which reached $126.98 a barrel on May 13. Backers of the measure also pointed to allegations that hedge fund Amaranth Advisers LLC tried to manipulate natural gas markets by moving to exempt exchanges after reaching position limits in the New York Mercantile Exchange, which is a regulated market.
[side note: Spot oil prices are also similarly high, so if anyone is manipulating the market, they must have a whole lot of storage.]
“This is not news,” Kevin Book, senior analyst for Friedman Billings Ramsey & Co., said in a telephone interview. “The leading indications that Intercontinental Exchange would see greater regulation go back to September 2006” when Amaranth Advisers gave notice it lost $6 billion in natural gas markets.
Profitable business, that market manipulation.
I for one feel much better at night knowing that Congress is working hard to keep unscrupulous hedge funds from losing billions of dollars.
