Carl Levin

And are price distortions and large price swings a problem?

In terms of the excessive amount of speculation, you do not consider that to be legitimate? If it is excessive, it is not legitimate.

Those are the speculators we are talking about.

But the speculation has now gone way beyond providing the needed liquidity for that kind of hedging.

I think it is critical that these markets have only--that they not have outsize concentration by one party or another.

I do think it was critical to put this in place and to fully implement it.

Does that netting rule open up a loophole for swap dealers who will be able to sell and offset as many single commodity swaps as they want even if that activity floods the commodity markets with speculative money?

We are just warming up for Mr. Gensler.

Does that trouble you? Are you OK with it?

I am concerned that differing treatment is problematic and will encourage levels of speculation because of that loophole that are going to be problematic for consumers.

The rule that came from the CFTC makes a distinction between commodity swaps that reference a single commodity, like oil, and those that reference a basket of different kinds of commodities, like oil, gold, and wheat.

By the way, we did actually stop it in the Senate.

Are ETPs adding to speculative pressures on the commodity markets?

All right. Let us try another round. I want to move to high-frequency trading.

So that there is a direct link between the futures contract price going up and the commodity price going up because people buying and selling the actual commodity use that next month's futures price as the basis for their price in the…

A direct link between a futures contract going up in price because of that last month, and that is used by the people who are actually buying and selling the commodity.

It depends on the supply-and-demand situation for the underlying physical commodity in your judgment.

The most important question is the relationship between the amount of speculation in commodities and the prices of those commodities.

People are beginning to understand the role that Wall Street plays in this.

Transferring that much purchasing power from consumers on Main Street to speculators on Wall Street puts a severe drag on the economy.

Speculators, who by definition do not plan to use the commodities that they trade but profit from the changing prices...

Congress enacted the new law not only to protect consumers and businesses from unreasonable prices...

Commodity prices have whipsawed American families, farms, and businesses, run roughshod over supply and demand factors.

We are likewise grateful to our two U.S. Senators who represent Michigan, the Honorable Carl Levin and the Honorable Debbie Stabenow.

I would just suggest to our members... to test the value of this bill they talk to two people.