Gold and Silver Market, Along with Other Commodities, Await October 18th CFTC Ruling on Position Limits
Among the many provision in the Dodd-Frank Act, one that could have a significant impact on gold, silver, and all commodities are those provisions that would limit excessive speculation by putting into place position limits. Bloomberg reports that the CFTC "after delaying consideration in September, delayed a final vote on the regulations until an October 18th Washington meeting, Steve Adamske, the agency's spokesman said on September 27th."
Bloomberg reports that the CFTC has come under pressure from lawmakers to complete the speculation rule, originally proposed in January.
Among the lawmakers, Senator Levin said “Until this proposed rule is adopted and effective position limits are put in place, the American economy will continue to be vulnerable to excessive speculation and the violent price swings it can cause, and American business and consumers will continue to be at risk,” Levin said in a March 28 letter to the CFTC.
During an CFTC hearing in January of 2010, it was reported that one trader held 23% of all open silver futures positions. Presumably, this high concentration of silver exposure will not be possible if position limits are put into place.