' 08/05/2009 15:43 9733513737 RANDOLPH MEDICAL PAGE 02/03 RANDOLPH DERMATOLOGY DAVID J. NAJARIAN, M.D. AND MOHS MICROGRAPHIC SURGERY, LLC 0 121 CENTER Gr~OVE ROAO • RANDOLPH, NJ 078f)9 • 973-366-6303 0) '· ' Dear Commissioner Dunn, _c As a 34 year old dennatologist. I am writing to protest the CFTC's recent push iP impose energy futures positions limits. According to one article I recently read: ""No longer must we debate the issue of whether or not to set position limits," Gensler said during the second day of CFTC hearings on excessive speculation in the energy markets."" Well, I totally disagree. What does he mean by "no longer must we debate." Gensler says this as if he is absolutely right and wants to deny others their freedom of speech. T have read too much nonsen.c;e about how speculators are responsible for excess volatility and the high price of oil last year. Too rnany people calling for trading limits because of excess speculation. Too many people blaming index funds for the high price of oil last year. First of a.ll, why are you singling out the Energy market as an inappropriately volatile market? I've been trading in all sorts of markets since 1991, and with the exception of one day in 1987, I've never seen volatility in the stock market, bond market, and all so1is of commodity markets like I saw last year. Do we therefore a.lso need to now blame speculators for excessive volatility in stock markets? Bond markets? How about other commodity markets? How do you even define "excessive?" There is no good reason why the energy market should be picked on. In fact, there were very good reaso.ns to have volatility and high prices in the energy market last year. Oil supplies were tight. .. the largest oil fields in the world are declining in production, yet demand was growing ... espccially from large economies like China. When it looked like the US housing market might fall apart, along with the rest of our economy, there was a great deal of economic uncertainty. Recall Ben Bemanke saying he doesn't see problems in subprime affecting the rest of our economy? Remember how suddenly we realized he was \.VI'ong? Remember how our economy, the largest consumer of oil, fell off a cliff suddenly? Are these not rational reasons to have had a very volatile market in energy (as well as stocks, bonds, and other commodities) last year? Placing trading limits on energy futures to curb excess speculation (e.g. by those who don't take possession of the physical commodity) does not appear to be in the best interests of the industry. As far as I know of, there is no good evidence that anyone AUG 05 2009 16=46 9733613737 PAGE.02 08/~5/2009 15:43 9733513737 RANDOLPH MEDICAL PAGE 03/03 RANDOLPH DERMATOLOGY DAVID J. NAJARIAN M.D. ANO MOHS MICROGRAPHIC SURGERY, LLC 1 121 CE'\i1'ER GReWE ROAD • RANDOL~H, NJ 07869 • 973-366-6303 cornered the market, unfairly 111anipulating the price of oil for everyone else. If there was such evidence, then new mles surely would be needed. The fact is however, there is no such evidence put forward. In addition, there are good reasons to believe that in the absence of such inappropriate market manipulation the more speculation allowed the better. Why? Speculators do a great dea] of research to uncover investment ideas. Some of that research is important and would never have been completed without lucrative incentives for speculators. For example, take a look at Matt Simmons book, "Twilight in the Desert." This book, written by an investment banker, is a masterpiece of fine, original research of the Saudi Oil fields that I doubt would ever have been written if purely financial speculators were not allowed to participate in the markets. Yet :findings published in this book are tmly important for anyone involved in Energy policy. The fact is, allowing speculators to participate in the energy markets leads to more research into the field's supply and demand dynamics ... how can this be a bad 'thing? More research should lead to rnore appropriate prices over the long term. However, curbing the ability of speculators to make money from trading in energy futures could easily reduce the amount of research done in the field, decreasing the visibility of supply and demand trends, and thus lead to greater distortions of supply, demand, and prices in the future. Finally, placing trading limits on energy futures by threatening the ability of index funds to invest in them is blatantly unfair to many Americans like myself. For example, I commute a long distance by car every day. Maybe I'd like to hedge against a possible rise in gas prices? How can I reasonably do that without investing in an index fund that · invests in the energy futures markets? The fact is, index funds, ETNs, and ETFs that invest in energy futures are an important way that small investors can hedge themselves against a possible rise in the pJice of energy in tbe future. If I want to invest in oil, I should be able to. If I want to invest in gas, I should be able to. And so should all other Americans. These rights are especially important given the possibility that our goverrunent's monitary policy could decimate the value of paper money--leaving physical goods (like oil) as important store of value. Sincerely yours, David .T. Najatian, MD Hoboken , New Jersey AUG 05 2009 16=47 9733613737 PAGE.03 From: Leslie, Douglass To: energyhearingcomments cc: Holifield, Robert Subject: FW: Position l mit legislation Date: Thursday, August 13, 2009 4:17:24 PM A comment for the hearing file. From: REILLY, BRIAN Sent: Thursday, August 13, 2009 4:15 PM To: Leslie, Douglass Subject: Position limit legislation Doug, pls forward to Gary Gensler. Thx, Brian Reilly Dear Gary, I am an investment broker and have clients who own shares of the United States Natural Gas Fund (UNG). This Portfolio of natural gas contracts currently has about 400,000 nat. gas contracts in the current month and they do not leverage beyong the inherent leverage in the commodity market itself. It provides me and my clients to own and track natural gas without the risk of owning commodity contracts themselves which as you know have a finite life. This public security also provides the opportunity to do covered call writing to generate cash flow for those folks who wish to participate in that kind of program. I bring this to your attention because of the interest in your committee to put position limits on the energy and other commodity contracts particularly by hedge funds and other investors who are able to ramp up leverage beyond reason. I am in favor of limits that are truly in the public interest. I am concerned, however, that we may throw the baby out with the bath water if the cash based participants in these markets are knocked off their horses along with the aggressive over leveraged participants in the hedge fund arena. I am hoping that your committee will exercise caution when you create your limit rules and try not to hurt the public investors who are simply investing to achieve capital gains and generate cash flow. Thanks for listening. Sincerely, Brian Reilly From: secretary To: energyhearingcomments; Subject: FW: Date: Thursday, August 13, 2009 10:30:07 AM Attachments: Commodity Markets Oversight Coalition.PDF To CFTC Div. of Enforcement Page 1 of 9 8 58:30 PM, 8/4/2009 617 9241022 New Eng•and Fuel Institute COMMODITY MARKETS OVERSIGHT COALITION August .5, 2009 The Honorable ~ancy Pelosi The Honorable John Boehner Speaker of the House Minority Leader 0 ~ U.S. House ofRepresentatives U.S. House ofReprescnrarives ~ Z! ::0 0 H·232 Capitol Building H-204 Capitol Building c:: ITI C') Washington, DC 20 515 Washington, DC 20515 0 ~ en -to The Honorable Hany Reid The Honorable Mitch McConnell ,..,:X:.~ . :\.faj ority Leader Minority Leader ::0 cn:-1 ::.:3 I'll 0 United States Senate United States Senate o· ,...... ::::0 S-221 Capitol Building S-230 Capitol Building Q E Washington, DC 20510 Washington, DC 20510: en .::0 ;n;,) ,;;: -t A CALL FOR MEA~INGF"CL REFORM OF COMMODITIES TRADING Dear Congressional Leaders: The undersigned organizations, representing business, industry and consumer interests vital to the United States economy, urge you to take &\\lift and meaningful action to improve federal oversight and transparency and to address regulatory inadequacies in the commodities markets. Our organizations and the public in general have lost confidence in these markets due to extreme price volatility, unwarranted price spikes and excessive spe'--ulation. It is time to restore confidence, stability and transparency in these markets. This letter is a follow-up to our June 3, 2009 letter regarding needed refonns, which we have attached for your convenience. We now wish to take the opportunity to address some of the arguments being made by opponents ofn:tonn- namely, the financial services industry. The CFTC Needs the Tools to Regulate Today, the Commodity Futures Trading Commission (CFTC) will wrap up a series of hearings examining the use of its statutory authority to set limits on the size of positions that individual traders may take in the market, as well as who may receive exemptions from such limits. We commt!nd Chairman Gensler and his te11ow Commissioners for these hearings and tor their commitment to greater transparency, accountability and oversight in the commodity markets. These hearings have brought to light some stil.ltling into1mation.