Regarding that "quadrillions of dollars stagnated in non productive speculative trading (gambling)" I should point out that the number is more like a little over a quadrillion according to various sources I have researched. It is also a global number and not a number specific to the USA. And finally and most importantly it is a notional value and not the market value.
For example, a farmer looking at current prices of his crops may decide to lock in that price now in case it loses value by harvest time. So he sells his crops on a futures contract at $100,000 -- that is the notional value of the transaction. He is guaranteed $100,000 for his crop at harvest time. If the price of the crop rises 10 percent in the meantime, he still gets paid $100,000 but the contract now has a futures market value of $10,000. If the price of the crop goes down 10 percent, he still gets his $100,000 but the market value of the futures contract is a negative $10,000.
The notional value is $100,000. The market value could be $10,000 or maybe -$10,000 or something in between -- zero if the price remains unchanged. Now let's suppose that those "gamblers" owning the futures contract get a bit worried that the crops might not rise in value. So they do a swap and sell the contract to someone else (another gambler) willing to take the risk...but at a lower price. Now that farmer's crop has been traded twice, and the notional value of all futures contracts for that period is no longer $100,000 but $200,000. And if that gambler trades the contract again there is another notional value booking entered again for another $100,000. Hence the cumulative notional values of the contracts trading the farmer's crop during the period before harvest has risen to $300,000, but the market value of all those combined futures transactions might be less than $10,000 or maybe even negative.
Now apply the same principle to all derivatives traded again and again on the global market and you can easily see why the notional values of all contracts rises to over a quadrillion dollars. This applies to currency trading, farmers crops, cattle, chickens, pork bellies, stocks, oil and gas supplies, insurance contracts, and just about anything that can be traded. The derivative values of any gains are reported as income to the IRS. They are taxed. Notional values do not count for anything.
The market values of all the derivatives traded in the world market is thus vastly smaller than the notional values....probably more like a few trillion and not quadrillions. How much is derived from and subject to US taxation? Considerably less.
Derivatives serve a valued purpose for ordinary folk like farmers, but I will concede that there are people who trade futures contracts on a daily basis such things as currency, pork bellies, stocks, etc. not to protect their investments such as an entire crop, but rather to speculate and gamble on future changes in the market. I do not know how much is legitimate hedging versus gambling, but it would be hard to legislate and restrict one without hurting the other...the farmer for example. I do know that when people cite "quadrillions" that the number is meant to deceive...way out of the ballpark.
The topic is frugality but you got off topic pretty quickly, and I just wanted to clarify any misconceptions.
There are some instances of justification of derivatives for a small limited number of markets. But is it fair or does it make sense to allow massive amounts derivatives to stagnate money out of the entrepreneurial jobs producing market into a non regulated speculative market that does toning for the underlying entity. Would it be fair or make sense for large companies to take out life insurance policies on millions of unknowing never benefiting individuals. It would divert money from the economy and force people to live frugal lives to survive retirement. If it doesn't earn it should illegal.