Joe Lieberman is saying that he is, “considering legislation to place limits on large institutional investors in commodities markets“.

Even if he weren’t a complete asshat, nothing would come of this, because he is from Connecticut, and with New York City being the world’s capital for such activities, and with many of the people who make a living on the trade living in Southern Connecticut, there is no way that he would really press this.

While I believe that one of the problems with any market today is excessive speculative capital in and out flows, Lieberman’s proposal is rather limited, directed at limiting pension funds and closing a few loopholes, and won’t do much good, because there is already an industry full of people who find ways of ignoring such restrictions.

Instead, I suggest a transaction trading tax on financial instruments. It’s easily implemented, hard to avoid, and penalizes those who trade the most.