with the amount of naked shorting that's allowed on US commodity markets, and the opacity of these markets (why are they not as transparent as for stocks & bonds?) IMHO anyone would be an absolute fool to take long leveraged positions there
Originally Posted by ironlady
Government Involves Itself in SOE Fuel Derivative Defaults
Last year's commodity price plunge caught a number of Chinese state-owned enterprises (SOEs) flat-footed and they suffered huge losses in fuel hedging derivative trading with international investment banks. Both the SOEs and regulators are straining to explain the debacle, and there are even indications they are inclined to blame fraud and/or conspiracy by foreign investment banks.
There has been no news in response from counterparties. It is reported that at least six international investment banks may be involved in the case. Goldman Sachs is the largest "banker" for oil derivative trading.
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