Public wants stronger rules: U.S. CFTC chairman

WASHINGTON (Reuters) - Americans want stronger federal control of financial markets, even if markets seemed to have stabilized after last autumn’s world financial meltdown, the head of the U.S. futures regulatory agency said on Tuesday,

“Inaction is just not acceptable,” said Gary Gensler, chairman of the Commodity Futures Trading Commission, during an interview with Reuters Television.

Speaking following a CFTC hearing on whether to impose trading limits on oil futures, Gensler pointed to the Obama administration’s proposals to bring over-the-counter derivatives under the regulatory umbrella.

“I don’t think the American public finds the status quo acceptable,” Gensler said when asked if regulatory reform is necessary.

“Anybody who thinks that last fall is just a distant memory ... just think about all the Americans that are out of work today because of the excesses of Wall Street. I just feel we have to do this, working with Congress.”

Some analysts blame a flood of investment-fund money for driving oil and agricultural futures to record levels last summer, peaking as the economy soured. Anti-speculation bills are pending in Congress to set stronger limits on how many contracts an investor can hold and to require more disclosure of who is holding futures contracts.

CFTC commissioners scheduled three hearings this summer on position limits and to see if other areas need attention.

“If we were to move forward with proposed rules, I would hope to do so in the fall,” said Gensler.

He declined to suggest what the commission would decide. In opening the hearing on Tuesday, he said, “I believe we must seriously consider setting strict position limits in the energy markets.”

Reporting by Charles Abbott; Editing by Marguerita Choy