May 5, 2009
Reinstate the uptick rule, as it was prior to July 2007, with no changes. Under that rule, a seller must first wait for a buyer to take the stock higher before a stock can be shorted.
The decision to allow group bear raids on stocks and allowing leveraged ETFs to control as much as two to three times the money in their funds.
The influence of the ETFs can easily been seen in the last 30 minutes of the trading day, when the funds are able to move the markets wildly as they cover their positions.
All of the ETFs who short market segments by 3x (such as FAZ - Financial Bear 3X, the ERY - Direxion Engergy Bear 3X, REC - Rydex Inverse 2X SP Select) and others such as RRZ - Rydex Inverse 2X , DUG - ProShares UltraShort Oil, REC -Rydex Inverse 2X SP Select Sector Energy and SRS - UltraShort Real Estate ProShares,
SHOULD ALL BE OUTLAWED.
These inverse, ultrashort ETFs destroy the stock market for the small investor, destroy the value of 401K 403Bs and of IRAs, because the stocks of companies are DRIVEN DOWN by momentum traders.
DO YOUR DUTY TO THE AMERICAN PEOPLE.
Reinstate the UPTICK RULE, as it was and outlaw 2X and 3X inverse ETFs.