CNBC interviewed two guests with opposing opinions about speculators in commodity markets. First Mike Masters made the case that speculators (and index funds in particular) were responsible for the explosion in commodity prices over the past few years. In particular, he points to the fact that long-only index funds have grown from $13 billion in their infancy to roughly $300 billion at the peak in crude oil prices.
Michael Cosgrove defended the speculators, arguing that the cause-and-effect relationship which Michael Masters seemed to imply simply does not exist. He further argued that speculators fill an important niche in the market, willingly taking on risk which the hedgers do not want.