Introducing CFTC Commissioner Bart Chilton, Metaphor Maniac

Rarely does a speech by a commissioner for the Commodity Futures Trading Commission before the American Public Gas Association show up on our radar. But the words spoken yesterday in Memphis, TN, by one of its newest members, Bart Chilton, deserve a shout out.

The man cannot resist a metaphor. But perhaps no regulator needs metaphors more than the C.F.T.C. to clarify its role in the murky world of commodities and futures trading. After all, Chilton reminds us, the fraud at Enron, Amaranth and BP all involved commodities trading scandals.

Chilton implored Congress to close the so-called "Enron loophole," the Exempt Commercial Markets provision of the 2000 Commodity Exchange Act that was inserted at the behest of Enron lawyers. It has resulted in "look-alike energy markets operating in the dark," which Chilton says are too difficult to regulate and will likely lead to "another economic calamity" along the lines of Amaranth.

He explains it thusly:

"Up to this point, ECMs have been operating sort of like cars driving on a highway without speed limits. Most of the time, drivers operate in a safe and responsible manner, but occasionally, somebody drives too fast, and the result is disastrous. The CFTC is suggesting that it's time Congress put up some speed limit signs on the ECM highway: not only will the road be safer, but the CFTC patrol car will be out there as well, ready to turn on the siren and pick up those who run afoul of the rules of the road."

If any of those fast drivers were in Chilton's audience, he has just four words for them: Hasta la vista, baby:

"That is why it is so vitally important that we are strong on the enforcement front. I can tell you that we meet each Friday and get a briefing on what is happening in the markets. We are not some "Andy Griffith" operation. We are more like "Elliot Ness" or "James Bond," or in the case of crooked operations we are shutting down; we are more like the "Terminator.""

In case that's not enough to scare any potential market manipulators straight, Chilton invokes the Paris Hilton alarm:

"In other words, if you manipulate these markets, we're watching, and we're going to get you. To continue with my traffic cop metaphor, it's like those commercials for drunk drivers: don't even try it, because the road blocks are set up, the sobriety check points are in place, and we'll make you walk the line. And if you stumble, we'll make you pay the price."

by Megan Barnett