Obama Wants Energy Speculator Crackdown

[Soultrader]

Article here: http://edition.cnn.com/2008/POLITICS....ap/index.html


WASHINGTON (AP) -- Sen. Barack Obama on Sunday said as president he would strengthen government oversight of energy traders he blames in large part for the skyrocketing price of oil.



Sen. Barack Obama said Sunday that he wants to crack down on energy speculators.

The Democratic candidate's campaign singled out the so-called "Enron loophole" for allowing speculators to run up the cost of fuel by operating outside federal regulation.

Oil closed near $135 a barrel on Friday -- almost double the price a year ago.

"My plan fully closes the Enron loophole and restores commonsense regulation as part of my broader plan to ease the burden for struggling families today while investing in a better future," Obama said in a campaign statement.

Obama's campaign blamed the loophole on former Sen. Phil Gramm, a Texas Republican who serves as Republican candidate Sen. John McCain's co-chairman and economic adviser.

The Obama campaign accused Gramm of inserting a provision into a bill in late 2000 "at the behest of Enron lobbyists" that exempted some energy traders from government oversight.


Houston-based Enron collapsed in scandal in 2001 when it was discovered the company had vastly overstated its income.

McCain spokesman Tucker Bonds said McCain has supported efforts to close the loophole and noted the bill in question was signed into law by former President Clinton.

"The fact that Barack Obama is attacking John McCain, despite McCain's leadership on the issue, shows that Barack Obama is driven by the partisan attacks that Americans are tired of," Bounds said.

McCain's campaign supplied a copy of a letter Gramm wrote to Sen. Byron Dorgan, D-North Dakota, on June 13 in which the former senator denied charges that the adoption of the bill was a "secret maneuver."
Gramm said he had "nothing to with the writing of the provision" on regulation of energy trading.

Obama's plan was outlined Sunday by New Jersey Gov. Jon Corzine, former chairman and CEO of Wall Street investment firm Goldman Sachs, during a conference call with reporters.

Corzine said the volatility in the price of oil "is absolutely indicative of speculation in the markets."

Congress already has acted to close the loophole, including a provision in the huge farm bill that passed earlier this year. But Obama's campaign said the candidate would go further by requiring that U.S. energy futures be traded on regulated exchanges.

Obama also would ask the Commodity Futures Trading Commission to consider whether traders should be subject to higher margin requirements.

He also would work with other countries to regulate energy markets and press the Federal Trade Commission and the Department of Justice to investigate possible market manipulation.

The campaign said Obama's proposal is part of his broader energy strategy that calls for reducing oil consumption by 35 percent by 2030.

[atto]

Politics aside, I wish we could get someone who understands economics in the White House. This isn't the first time a basic Economics 101 lesson would help a lot. What's he want to do? Limit/Regulate the US oil futures market? All that would do is shift volume to other (international) exchanges.

Speaking of economically minded politicans, check out Ross Perot's new site. There's some really good information there about the current US economic condition.

[james_gsx]

It's all talk to appeal to the idiocy of the public.

They need to focus on far more important economic concerns then the price of oil. If in fact all that volatility is due to speculation, then it will all leave some day which will cause the price to drop. When the Dow, S&P, and Gold are all going shit f**k crazy it makes sense to throw some money in oil which seems to only go up. It will hit a tipping point, and all that money will be wiped out. Look what happened to gold.

[atto]

Agreed. Promising to "fix" the oil markets simply buys easy votes ("oh no, the gas prices!") and ignores many of the larger issues.

Plus, high oil boosts the alternative energy markets. Isn't that what he wants? Put a ceiling on oil (or however he wants to do it) only prolongs serious money going to R&D for cheap, safe, clean energy. Whoops...

	Quote:
	The campaign said Obama's proposal is part of his broader energy strategy that calls for reducing oil consumption by 35 percent by 2030.

35% is nothing if nucular power is utilized again. And unfortunately, Presidencies only last 4-8 years, so a 22 year plan may boil down to all talk and no action.

[forsearch]

He also wants to increase the cap gains rates - something that won't go down well with the futures traders in Chicago.

You may recall that it was a Chicago pol, Rostenkowski who got the capital gains tax break for the futures traders extended.

I suspect that it's all talk for the masses, and the Daley machine will prevail in keeping at least the cap gains for futures traders in tact.

Plus, having Gov. Corzine (ex-Goldman Sachs) on point for his economic plan is meant to send a reassuring signal to the market.

-fs

[Trader333]

Any attempt to manipulate a fair traded market will usually fail. If the price of oil is like the tech boom bubble and not ultimately caused by demand being greater than supply then it will go the same way and collapse again. If not then trying to stop it rising in price will quite simply fail in my view.


Paul

[Sledge]

	Quote:	james_gsx
	It's all talk to appeal to the idiocy of the public. They need to focus on far more important economic concerns then the price of oil. If in fact all that volatility is due to speculation, then it will all leave some day which will cause the price to drop. When the Dow, S&P, and Gold are all going shit f**k crazy it makes sense to throw some money in oil which seems to only go up. It will hit a tipping point, and all that money will be wiped out. Look what happened to gold.

Without sounding like some minion- darn near every time I read one of your posts it makes me think- "damn this guy is one smart MoFo"

All so very true, it is politics- every candidate is finding the "hot button" issues and playing to the voters. Today it is oil spiking and the candidates are all over it, when more and more of the housing bubble bursts, you'll see the candidates start talking about how we need gov't regulation of predatory lending- I hear the following "I will make these banks and lenders accountable, they will have to answer to why they took advantage of the american people (read: ignorance) to make a buck"

Oh and watch for this: Couple weeks before the election Osama Bin Laden will be captured- thus ensuring a Republican victory for the White House. The American people will think that the war is now "Good Again" and throw their support behind a 71 year old putz who will keep us in Iraq fighting for THEIR freedom..

[atto]

	Quote:	Sledge
	Oh and watch for this: Couple weeks before the election Osama Bin Laden will be captured- thus ensuring a Republican victory for the White House. The American people will think that the war is now "Good Again" and throw their support behind a 71 year old putz who will keep us in Iraq fighting for THEIR freedom..

I used to be very politically minded and get engaged in political discussion at large. I have since realized that it is near impossible to get a truely honest and brilliant man in the oval office. Instead of benefiting from solid ideas and reform, politicans mostly pander for votes. For instance, I've yet to hear what the two viable canidates plan to do about government spending or Social Security.

I used to "support the war". After educating myself a little more, I think it's sick, and the unintended consequences will be greater than anyone could have imagined. However, my "support" for the war has nothing to do with my love for America or support for the troops. To throw those uncorrelated and unconnected ideas together is just stupid. In my opinion, we simply do not and cannot understand the politics and culture there. It seems George Washington was right:

	Quote:
	Peace, commerce and honest friendship with all nations; entangling alliances with none.

[firewalker]

"Obama also would ask the Commodity Futures Trading Commission to consider whether traders should be subject to higher margin requirements."

[forsearch]

	Quote:	firewalker
	"Obama also would ask the Commodity Futures Trading Commission to consider whether traders should be subject to higher margin requirements."

Apparently, Obama's a different kind of speculator...

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