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While corn and soybean prices are falling from their peaks as concerns over the midwest drought lessen the but this next commodity guru says that investors focus on agriculture are missing the number one market right now we'll get -- that in a moment.
Leo Melamed is the father of the futures market and chairman emeritus of the CME group he joins us now.
In a Fox Business exclusively -- thank you so much for coming in appreciate it.
Very happy to be here you know what we we called your guru are -- almighty I kind of think of view is the Jack -- of commodities you -- who you have.
You have this encyclopedic knowledge of of what moves commodities and I'm just -- when you think of the -- have door or the weather's we just mentioned.
Or economic output which index index or indices do you focus on bid to give an idea where commodities are going.
Well actually -- -- aren't they change from time to time at the moment.
I think the foreign currency issues or currency generally worldwide.
Is on the cutting edge of decision that has to be made very very shortly.
Whether it's the QE3 decision.
By the Fed.
Or whether it's whether or Greece or Spain and some of the other countries will be able to stay in the Euro.
And that's our huge question for -- -- whole world -- of course.
Those markets are going to of they're -- -- gyrate as soon as they know which way it's going.
Well in Europe is is a little too hard for us to figure out but -- bringing it closer to home the Fed in a couple of weeks is is due to report.
It's kind of the market is kind of expecting something to happen as a result of a lot of the whispers.
That have been coming out of the Fed if nothing does happen what happens to the markets and commodities.
Well it's certainly in the in the stock market that's going to be -- big downer.
Because the stock market has been expecting it has gotten all kinds of signs that.
The QE3 -- something will happen if if it doesn't happen of course the stock market's going aren't really fall for it.
Further obvious reason because it's built in that they will be some action.
In -- currency markets that's gonna strengthen the dollar because that right now the expectation is that there.
Will be a QE3 which is of course something that will soften the dollar that happens now so job.
Both of those things are going to affect the markets.
In the coming weeks.
We have an election coming in a couple of months some wondering how some of those issues.
You see is reflected in the economy or how perhaps the candidates should put them forward first of -- We're talking about the Fed Romney has said that he -- a strong dollar that he doesn't like the work that Ben Bernanke's been doing.
In terms of turning more money is he on the right track -- the run track and that.
You know every every nation wants a strong dollar theoretically.
But a weaker dollar of course helps your -- so it's not it's not a clearer picture but as far as.
The election goes that one of the big issues is the Dodd-Frank.
Regulation would have been put in place.
And -- really very difficult.
For the American business community to abide by and and that's also true for the European.
Our community that is facing similar effects not back as American business well on Dodd-Frank.
Both of those both of those elements are going to have to be decided on if if Romney does win.
-- I -- you know related to that is is the question of enforcement and whether we've been focusing too much on new rules new -- too many of them frankly not enough on good enforcement.
And people look at MF global and what happened there and of course commodities traders some of -- really got burned by what happened with -- MF global are you surprised.
That there haven't been any indictments -- -- and should there be.
Well I am a little surprised because that was that was something that.
Should not have happened.
It it it didn't happen in futures and over a 150 years and suddenly it happens at a moment in time.
When when -- company is in need of money and it uses segregated funds that was just terrible.
And but I must say that Dodd-Frank wouldn't wouldn't have helped that this was.
An individual company doing something wrong and I guess it's like you know -- -- you commit a crime.
And anyway you can do that then did nothing can stop the person from committing a crime paid by the way quickly how's how's that Terry -- for years it took Terry Duffy your successor been -- it.
He's doing great and -- you know our business is sound a little bit in volume rises everybody's.
Our business because the economy.
Is kind of weak and it's no secret there anybody that.
That produces volume when the when you have a strong economy and the and the reverse is true when you have a week.
Okay we wanted to talk more -- commodities but we got some breaking news specifically about currency would you come back Leo plays.
Absolutely Leo Melamed the father of the futures market great pleasure to -- Helio.
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