The Commodity Markets Transparency and Accountability Act, a bill that would have required foreign boards of trade to adopt speculative position limits, was rejected today by the U.S. House of Representatives. With a vote of 276-151, the bill failed to get the required number of votes to pass the House. The bill would have required the Commodity Futures Trading Commission (CFTC) to set trading limits for agricultural and energy commodities and would have “limited eligibility for hedge exemptions to bona-fide hedgers,” required more detailed reporting from index traders and swap dealers and increased staffing at the CFTC. The Bush administration released a statement opposing the bill, saying it “offers poorly targeted short-term measures that do nothing to address the fundamentals of supply and demand that bear the primary responsibility for current high energy prices. The bill will hurt the competitiveness of American futures markets.” If the bill had been presented to the President, his senior advisors would have recommended that he veto it.
This is the second bill on energy speculation that has failed a vote in Congress in recent days. On Friday, the Stop Excessive Energy Speculation Act of 2008 failed to receive the required votes to continue consideration by the U.S. Senate, and the issue is expected to be tabled in the Senate until fall. This bill came under fire from the Coalition to Protect Competitive Markets, an organization which includes the Futures Industry Association, Managed Funds Association, CME Group, Intercontinental Exchange and others. The coalition said that the bill would have “drive[n] commodity trading overseas, rather than providing long-term solutions to our energy needs.”
