Commodity Online
WASHINGTON: The US commodities regulator, Commodities Futures Trading Commission (CFTC) should have done a better job of regulating speculation, swaps and seeking information on Over The Counter (OTC) Trading, according to Bart Chilton, Commissioner CFTC.

Adressing the European Union Attaches at French Embassy here, he pointed out that CFTC did a much better job compared to other financial service regulators in USA but fell short many times. “Although issues within the CFTC’s regulatory purview were not in the epicenter of the past year’s financial meltdown, we could have, and should have, done much better on some issues before and during this crisis,” Bart Chilton said.

He said that free markets work well on a pristine test track but not so much on the real road which is filled with potholes and varying conditions. Lack of regulation had affected the functioning of both financial and commodity markets, Chilton said. “That is what happened when banking laws were deregulated in 1999 and it is what happened when the Commodity Futures Modernization Act (CFMA) was enacted in 2000. There were certainly good parts of CFMA, but the exempt commercial markets provision (ECM) and the swaps provision, in particular, certainly could have been drafted in a different manner that didn’t leave open the possibility for abuse,” he said.

In a global economy, what the US does impacts the neighbours, therefore, global co-ordination and co-operation are all the more important for the future, CFTC Commissioner said.

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