June 19, 2009
I am a recently retired businessman who has invested in stocks and mutual funds primarily as a long term investor for over thirty years. During this period of time I have witnessed an incredible increase in volatility and volume of shares traded. Over the past several years trading has seemed to take on more importance than long term investing. A large volume of trading has involved the short selling of shares, a great deal of it naked short selling. Short selling at best is a controversial short term stategy. At its worst it can destroy companies. When the uptick rule was repealed two years ago it set the table for what amounted to destructive raids by short sellers on companies such as Bear and Lehman Brothers. The absence of an uptick rule combined with naked shorting of financial stocks led to a lack of confidence in the markets last year, and a financial crisis which is still hurting the economy. To reemphasize the importance of real long term investing over short term trading please reinstate the uptick rule and enforce the rules against naked short selling
Thank you
David J. Siler