![]() The events of the last few days, from the London Metal Exchange shutting down nickel trading to commodity titans rushing to raise credit lines, make Lane’s hypothetical a crucial question right now. “Could the failure of one of the large trading houses cause serious disruption in the commodities markets?," he asked in a speech in September 2012, arguing their size raised “the possibility” they were “becoming systemically important.” Lane was among a small group of officials who worried it was hiding in plain sight - that the likes of Glencore Plc, Cargill Inc., Vitol Group and Trafigura Group, the secretive giants that underpinned global trade in natural resources, represented a systemic financial risk. A decade ago, Timothy Lane, deputy governor of the Bank of Canada, posed an intriguing question: Are commodity traders too big to fail? It was just after the 2008-09 global financial crisis, when policy makers were scanning the global economy looking for the next potential nightmare.
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