Traverse City Record-Eagle

Your Views

April 23, 2012

Letters to the Editor: 04/23/2012

Excessive speculation

The report on page six of the April 18 edition concerning oil market price manipulation is very important.

Many citizens like myself are naive in thinking gasoline prices at the pump are up and down according to the old principal of supply and demand.

Not so, as the recent report of the Commodity Futures Trading Commission, that 80 percent or more of oil trades are now made by speculators.

In February, Forbes magazine, citing a recent report by Goldman Sachs, that oil speculation adds 56 cents to the price of each gallon sold at the pump.

It appears that if and when some relief is obtained, excessive speculation has to be curbed.

There is legislation on the books to prevent speculators from dominating markets and distorting prices, but the financial industry has filed lawsuits asking the court to suspend the rules, so it is at a standstill.

In the meantime — the question remains how to fight big business vs. the welfare of the consumer?

Thomas E. Hagan

Empire

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