April 20, 2009
The uptick rule may slow the downward cascade of prices during a large sell off.
But it is the Naked Shorting which is the greatest problem. Brokers do not permit small investors to submit naked shorts, but they do allow it for hedge funds and similar entities. We do not have anything like a level playing field.
A reasonable penalty, such as $10 per share per day for failure to deliver stock would greatly reduce the practice.
Enforcing the existing rules would go a long way to righting the situation.