May 28, 2009
Based upon the inability of your organization to police anything having to do with short selling securities and even policing your own personell I suspect anything you do with be inadequate. "Naked" short selling is alreading illegal and you cannot police that unless it is processed through the clearing house.
Therefore in my opinion regulations should be invoked that would eleminate short selling in any form at anytime by anyone with severe penalties for violations.
There does not exist any parallel in our legal system that allows one to take another's property, sell it, put the current owner at risk of loss, by imparing his ability to sell the property, not compensate him for the use of the property, and allows the "short seller" to create an atmosphere of panic by selling property he does not own at lower than the going market price for the express purpose causing the price of equities to plunge.
The history of the past year has demonstrated that unbridled shorting hss caused extensive damamge to the American economy and also devastated the confidence of the American people in our country and its financial systems. The "uptick rule" was put in place to prevent the very thing that has happened in this country.
Your request for comments on this subject and the kind of opposition to the various alternatives you have proposed should be enough to demonstrate that you have no ture control over compliance with such controls. I suggest that your plans are like a doctor who suggests to a patient that he take two aspirins and call in the morning, when what the patient really needs is a lobotomy