May 5, 2009
Dear Folks:
Please initiate a circuit breaker for declining equity prices. The use of a percentage of the stock price may be the easiest technology to implement. A percentage rate would also be the most equitable since a $10 stock and a $100 stock would have the same circuit break.
I have consistently traded stocks as a small retail investor for thirty years. The obvious difference in equity prices, particularly the financial sector was quite dramatic after the old "up-tick" rule was removed.
Please do not be fooled by the large bear traders that will be opposed to this change. It is MUCH easier to drive a stock down to nothing than to invest in a long term rise. A short seller does not have to invest anything. And an stock investor has NO option to refuse lending of his shares to a short seller. This is analogous to letting someone destroy your house without your permission. That is inherently unfair.
Thank you for your efforts. I am confident that you will do the correct thing.
Sincerely,
Scotland Settle