We’ve done a couple of posts recently about speculators and how they’re being blamed by politicians and the media for rising consumer prices. And we haven’t made a secret about the fact that we completely disagree. Turns out, we’re not the only ones who think the finger pointing is misplaced/counter-productive/sophomoric.

The Huffington Post published an article the other day discussing the cries from Capitol Hill to curb speculation- particularly in the case of oil. We’ve pointed out that speculators aren’t really to blame for rising crude prices, but the article makes another good point: the same people that are complaining about the oil prices are profiting from them. The article explains,

Sen. Bernie Sanders (I-Vt.) demanded on Thursday that regulators impose limits on oil speculation to help lower the price of gas in a letter sent to President Obama… In the current regulatory environment, the Green Mountain State is included in those who are defined a speculators… In effect, Sen. Sanders is mad with the labor unions and civil service employee retirement plans — the largest investors in the asset class known as Managed Futures — what some like to call speculators… Vermont’s commodity investment is through the DJ-UBS Commodity Index, which has a whopping 34 percent allocation to energy futures, with 24 percent of it in crude oil, heating oil, and gasoline. The crude oil allocation is 16 percent alone… Vermont has ridden crude oil all the way up from about $66 to its current level of $112 per barrel … a 100 percent increase.

While the article misses the mark in linking the DJ-UBS Commodity Index with Managed Futures (the former being long only, the latter being long/short), the point remains – the so called speculators people rail against aren’t always evil ‘Gordon Geckos’ in $5,000 suits. They are sometimes the teacher, fire fighter, and DMV employee via their pensions.

Before demanding the speculators be stopped, consider what that might do to pension investment performance, which are already terribly underfunded in most cases.