In “The Public Be Damned,” Ted Butler declares that “The whole premise of the economic justification behind commodity futures trading has been bastardized.” He fingers “unbridled speculation and computer-type HFT trading gone wild,” as well as the CME Group for facilitating it and the CFTC for allowing it to continue. “US law has sanctioned the trading of commodity futures for the express purpose of allowing legitimate producers and consumers to hedge or transfer their price risks to speculators,” explains Butler. “But the wild price swings we are witnessing are not related to legitimate hedging. The volatility is as a result of speculators battling speculators, with real hedgers largely on the sideline.” More on how “HFT is sucking the life blood out of the markets: liquidity.”
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