May 13, 2009
S7-08-09:
Naked Short selling of stocks which the seller does not possess should be stopped. In addition, there should be a mechanism to temporarily halt the sale of any stock during a critical downturn that could result in the company collapse by those interested only in their own profit. As discussed, a "circuit breaker" could place a temporary hold for the company to review the market pressure and respond.
During the early days of the economic meltdown, even the recalitrant Chris Cox put a hold on this type of sell. The market didn't dissolve as these individual dealers complained, but many Hedge funds were willing to bet against the entire country.
As the Hedge fund industry is supposedly going to have regulations placed on it during the Administration, there needs to be some rule to stop those brokers who will bet against the market and subsequently profit from this action. Some companies will fail, but we don't need a few individuals getting rich at the expense of an company and all of its their stockholders, without the opportunity to survive this type of assult.