April 17, 2009
Yes, the Uptick Rule should be restored. In my opinion, it was a huge mistake eliminating the Uptick Rule in the first place. Who benefited from the elimination of the Uptick Rule? It was certainly not the average retail investor. It was the Hedge Funds and NY Mellon Bank who benefited the most from the elimination of the Uptick Rule. Why would the SEC eliminate a regulation which protected the average investor yet benefit Hedge Funds, which are not even regulated by the SEC? Maybe Christopher Cox should be asked that question - under oath.
And what if anything, will be done to prevent and penalize those who engage in "Naked" short selling? Christopher Cox said that the SEC was supposed to stop "abusive" naked short selling, which they failed to do. However, what I find unbelievable, is that Mr. Cox failed to realize or admit that ALL naked short selling is abusive. There is no proper or appropriate naked short selling. The shares to be borrowed should be available before the short sale is made - not after or NEVER which is usually the case. How many days or times must a stock make the "failure to deliver" list before the SEC admits that a crime is being committed?
Ms. Schapiro. I, along with millions of Main Street investors, will be watching to see if under your leadership, the SEC restores the Uptick Rule, and finally cracks down hard on the illegal and highly unethical practice of "naked" short selling.