April 17, 2009
In 2007 the SEC stated a "Real World Analysis" indicated the removal of the uptick rule would not result in an increase in the short interest ratio, but that was never the issue. Minimizing a "waterfall effect" on a stock price decline was, and is the justification for the uptick requirement.
Market volatility and damage to the portfolios of virtually all investors increased exponentially since the removal of the short sale "uptick" requirement in 2007. I have no problem with shorting stocks, but removing the uptick rule resulted in a "waterfall effect" last fall, which is precisely why it was created after the Great Depression. We now see most people wondering why their life's investments are in constant jeopardy. Reinstatement of the uptick rule must be done to prevent an untethered free fall every time a new rumor is circulated.