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The Current "Gas Crisis" is Manipulated- We are Being "Enron-ed" by the Oil Companies
Michael Greenberger, the former head of the CFTC's Division of Trading
and Markets, testified yesterday before the Senate Commerce Committee
on the topic of Energy Market Manipulation. He stated that the
investment banks, namely Goldman Sachs (GS) and Morgan Stanley (MS),
control the price of oil and natural gas through the ICE futures
market. He cited that Morgan Stanley currently owns 27% of the natural
gas futures.
He stated that former Senator Phil Gramm of Texas sneaked the Enron loophole through a large piece of insignificant legislation years ago: the result was that regulations upon the futures industry were abandoned. This loophole eventually allowed the current CDO-subprime crisis, and the current energy market crisis because regulations, which once protected the market from manipulation, are no longer enforcible.
Greenberger suggested that the current attempt of closing the Enron loophole by Senator Levin through the Farm Bill, would not work - as it would leave the government with the constant burden of proof to prove manipulation was occurring. Also it would only be enforcable on domestic market manipulators and not international ones.
Greenberger said that legislation immediately closing the Enron Loophole with a broader, international scope would stop market manipultion and would cause oil prices to plunge over 25% overnight.
Here is a video link to the testimony on market manipulation on CSPAN. Additional reading here.
http://seekingalpha.com/article/80010-greenberger-s-testimony-i-banks-co...
Michael Greenberger, the former head of the CFTC's Division of Trading and Markets, testified yesterday before the Senate Commerce Committee on the topic of Energy Market Manipulation.
He stated that former Senator Phil Gramm of Texas sneaked the Enron loophole through a large piece of insignificant legislation years ago: the result was that regulations upon the futures industry were abandoned.
Greenberger said that legislation immediately closing the Enron Loophole with a broader, international scope would stop market manipultion and would cause oil prices to plunge over 25% overnight.
As early as the winter of 2002, it was widely known that the 2000 Commodities Futures Modernization Act had created a monster, capable of running up energy prices outside of the normal law of supply and demand.
Worse, our government had been warned this was going to happen. Representatives of the Federal Reserve, the Securities and Exchange Commission and the CFTC had already told Congress not to deregulate energy because "the market was ripe for manipulation."
Professor Greenberger warned about our "New American Economy" far better than I could:
"Should we have an economy that’s based on whether people make good or bad bets? Or should we have an economy where people build companies, create manufacturing, do inventions, advance the American society and make it more productive? We are rewarding people for sitting at their computers and punching in bets. That’s not the way our economy is going to be built, and India and China, with their focus on science and industry and building real businesses, are going to eat our lunch, unless the American public wakes up and puts an end to an economy that praises and makes heroes out of speculators."
Greenberger’s statement explains why Detroit and other American manufacturers suffer while Wall Street speculators make a fortune — and your rapidly shrinking checkbook pays for it, every time you buy food, fuel or feed.
All because there is no shortage of these goods, you’re just being told there is because it’s more profitable – for a few – that way.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&add...
He stated that former Senator Phil Gramm of Texas sneaked the Enron loophole through a large piece of insignificant legislation years ago: the result was that regulations upon the futures industry were abandoned. This loophole eventually allowed the current CDO-subprime crisis, and the current energy market crisis because regulations, which once protected the market from manipulation, are no longer enforcible.
Greenberger suggested that the current attempt of closing the Enron loophole by Senator Levin through the Farm Bill, would not work - as it would leave the government with the constant burden of proof to prove manipulation was occurring. Also it would only be enforcable on domestic market manipulators and not international ones.
Greenberger said that legislation immediately closing the Enron Loophole with a broader, international scope would stop market manipultion and would cause oil prices to plunge over 25% overnight.
Here is a video link to the testimony on market manipulation on CSPAN. Additional reading here.
http://seekingalpha.com/article/80010-greenberger-s-testimony-i-banks-co...
Michael Greenberger, the former head of the CFTC's Division of Trading and Markets, testified yesterday before the Senate Commerce Committee on the topic of Energy Market Manipulation.
He stated that former Senator Phil Gramm of Texas sneaked the Enron loophole through a large piece of insignificant legislation years ago: the result was that regulations upon the futures industry were abandoned.
Greenberger said that legislation immediately closing the Enron Loophole with a broader, international scope would stop market manipultion and would cause oil prices to plunge over 25% overnight.
As early as the winter of 2002, it was widely known that the 2000 Commodities Futures Modernization Act had created a monster, capable of running up energy prices outside of the normal law of supply and demand.
Worse, our government had been warned this was going to happen. Representatives of the Federal Reserve, the Securities and Exchange Commission and the CFTC had already told Congress not to deregulate energy because "the market was ripe for manipulation."
Professor Greenberger warned about our "New American Economy" far better than I could:
"Should we have an economy that’s based on whether people make good or bad bets? Or should we have an economy where people build companies, create manufacturing, do inventions, advance the American society and make it more productive? We are rewarding people for sitting at their computers and punching in bets. That’s not the way our economy is going to be built, and India and China, with their focus on science and industry and building real businesses, are going to eat our lunch, unless the American public wakes up and puts an end to an economy that praises and makes heroes out of speculators."
Greenberger’s statement explains why Detroit and other American manufacturers suffer while Wall Street speculators make a fortune — and your rapidly shrinking checkbook pays for it, every time you buy food, fuel or feed.
All because there is no shortage of these goods, you’re just being told there is because it’s more profitable – for a few – that way.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&add...
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Thank you for this. This
Thank you for this. This seems so obvious, but people keep focusing on gas mileage and conservation, when that is NOT the real problem here.