Parthasarathi Shome: Volatile times

Mumbai : Regulators and experts recently met in Brussels to analyse market volatility in food and agricultural commodities, fossil fuels and energy, and industrial raw materials, and to debate what regulators can and should do, and how multilateral institutions might respond coherently.

French President Nicolas Sarkozy delivered an impassioned speech on why markets should be regulated. A handful of players are controlling large chunks of most markets, driving and determining prices. Further, huge gains are being made from orchestrated price movements rather than availability based on production and weather conditions, or changes in demand for products owing to economic growth or natural disasters. He implied that an intolerable situation was developing and that regulation had become imperative. He indicated that he was giving the speech in anticipation of the following week’s Paris meeting.