Banks to CFTC: "Not Me!"

The comments coming out of the CFTC hearings in Washington this week remind me of watching an episode of Seinfeld. Everyone speaks but nothing is really said. Banks to CFTC: "I thought YOU were putting limits on positions". CFTC to banks: "What? I thought YOU were doing it."
At the CFTC hearing yesterday the head of commodities at JPMorgan Blythe Masters (who as much as INVENTED credit derivatives and is married to the once head of Phibro and now an energy fund manager) said that the CFTC should absolutely put limits on speculators - but only the 'end users' not the banks. Dan Casturo from Goldman Sachs enthusiastically agreed, reiterating that the banks were providing a critical 'service' to hedgers. According to my sources, Gary Gensler, who used to work for Goldman Sachs and knows exactly what the bank provides, as much as winked at Casturo and in so many words said 'I think not.' Masters hinted that business could go elsewhere if the CFTC was too draconian, but that has always been a danger with better regulation. The energy exchange in Dubai was not set up purely to trade Arab Gulf crude after all, and Vitol did not invest in it for the desert real estate value. Meanwhile the UK's FSA has called a spur-of-the-moment meeting with oil market players to discuss whether changes need to be made to FSA regulations. It sounds like someone at the CFTC had a word in the FSA's shell-like. Hopefully the FSA has invited some 'end users' as well.