Saturday, June 18, 2011

Government Case Against Oil Speculators Not So Simple

Hard Assets Investor submits:

By Dave Nadig

The Commodity Futures Trading Commission ((CFTC)) case against oil speculators isn't a slam dunk, and isn't as simple as the media would have you believe.

Fundamentally, investments in commodities futures are bets on the future of the commodity's price. Every once in a while, somebody gets the bright idea to make it less of a guess and try and push a commodity's price around while making corresponding investments in futures. Often ? as in the case of the notorious "Mr. Copper"; the Hunt brothers' attempt to corner silver; and Malaysia's move to corner tin ? the attempt ends in large losses. Even when it looks like someone has beaten the system, they then have to also escape government investigations and intervention.

On May 24, the U.S. CFTC


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