David Lentz

Strategies for Surviving Stagflation in the U.S. and Asia

If you want to rein in the US commodity markets (which are clearly out of control, with speculators running the asylum), merely raise the margin reserve requirements. That's the sort of tightening that would help things.

No reason why commodities margin requirements should be in the 5%-10% range, while equities are at 50% -- well, there IS a reason, to enrich the speculators in the futures markets.

The responsible authorities (stop laughing!) could raise the futures margin reserve requirements overnight, and all the pressure in the commodities markets would immediately subside.

If there truly is more demand than supply, then prices would not be altered much. But the amount of money percolating in the commodities markets would subside to that necessary to perform trades pretty quickly -- taking about as long as they were given to raise the reserve levels required.