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Wednesday, Oct 2
Fed widens review of bank commodity ops to include Goldman, MS
- The Federal Reserve has reportedly expanded its inquiry of banks' physical commodities activities to include those of Goldman Sachs (GS) and Morgan Stanely (MS), adding to reviews of Citigroup and JPMorgan.
- The Fed is looking at the legal and regulatory exemptions that enable the firms to operate in the commodities markets. The scrutiny comes amid accusations that GS and JPM manipulated prices in the aluminum and electricity markets respectively.
- However, the U.S. Chamber of Commerce, as well as Boeing, UPS and other companies, yesterday said that forcing banks out of commodities would cause them difficulties.