The Fox responds to why the chickens are missing...

[crazymans economics]

http://www.theglobeandmail.com/...

In a report that should shock absolutely no one, the Commodities Futures Trade Commission (CFTC) has released an initial CYA study where they claim that (gasp!) speculators are not the reason for high gas and food prices, as has been reported. But it's really (people keep buying it so they keep saying it) "supply and demand" that's the issue.

According to the article,

<blockquote>The task force is led by the CFTC and consists of representatives from the U.S. Departments of Agriculture, Energy and the Treasury, the Federal Reserve Board, the Federal Trade Commission and the Securities and Exchange Commission.</blockquote>

And therein lies the problem. As the article states:

The CFTC, which regulates energy trading in the United States, has come under increasing pressure from politicians and consumers to crack down on speculative trading in oil and other commodities. Many U.S. politicians blame institutional investors for driving up the price of oil, and the Senate is considering legislation that would require traders to provide more information on unregulated over-the-counter transactions. Those transactions, led largely by complicated swap deals, have increased in recent years and have become popular investment vehicles for index funds and pension plans.

So, we've been victimized by the rampant unregulated and unreported activities of speculators, along with activities in useless and equally unregulated additional revenue streams like derivatives. The increased activity, while hurting nearly every American consumer, has led to an increase in fees and commissions to the commodities exchanges. They are not suffering in this economy.

OF COURSE this so-called task force is going to blame supply and demand. Except it's crap. S&D may be one factor, but the National Futures Association admits that a myriad of factors contributes to the setting of prices as determined by the consensus of the buyers and sellers. It all gambling on predicting an unpredictable.

This report is a convenient excuse to take the heat off themselves by blaming the ol' standby supply and demand.

Remember that the goal of the regulatory agencies is to ensure the success of the markets, not the consumer or investor. And you think the Agriculture or Energy Departments will complain that farmers and corporations are receiving about twice the normal price for corn for food and fuel?

Don't let them get away with it. Force Obama and the Democrats to hold their feet to the fire and have an honest accountability of why the markets are out of control.

www.crazymanseconomics.com