July 19, 2008
Point 1. SEC should not ask the retail investor to become expert on your rules and your procedures in order to submit a comment with a narrow framework. But since you do, I wish to say that "naked shorting" is a crime against humanity.
Furthermore the absurd argument that "shorting provides liquidity" predicates the idea that liquidity is vital and that it cannot be obtained without shorting. There was liquidity long before shorting.
I despise shorting, and want SEC to outlaw shorting in its entirety because you cannot regulate it in an ethical manner for several reasons. When the system that you are using becomes too complex to enforce what needs to be enforced, the solution is not to keep that system, but rather to downsize it to enforceable proportions.
The foregoing comment would apply to many of your rules. You can surely see that short selling allowed George Soros to get rich and now allows him to spend huge sums of money to try to influence the U. S. election. This is a direct consequence of allowing short selling of financial instruments, which should never have been permitted.
Show some gutsy leadership, please.
John N. Warfield, Ph. D.