Congress is blaming rampant commodity speculation for rocketing gas and food prices, and berating regulators for letting it happen, the New York Times reports. Unless watchdog groups like the Commodities Futures Trading Commision crack down, Carl Levin says, "we don’t have a cop on the beat.." Joe Lieberman has even introduced a bill to ban institutional investors from commodity markets.
Speculators are a market necessity, adding the liquidity that keeps prices reasonably stable. But big speculators, the congressmen argue, are manipulating the market illicitly. “There is a difference between speculation and excessive speculation,” says Lieberman, but Congress has to “legislate that definition better. We can’t just say, as Justice Potter Stewart once said of pornography, that we know it when we see it.”