September 18, 2009
Short selling is a necessary part of market activity. However, naked short selling has irreparably damaged and, in some instances destroyed, many public companies in the US over the years whilst enforcement has been inadequate. Short-side hedge funds like Rocker Partners used the frontrunnning of articles by yellow journalists to profit at the expense of shareholders of promising companies like Dendreon and SmarTire.
The US must not allow any further deterioration of trust in our capital markets - the damage is bad enough already. The SEC must reinstate the original uptick rule, as well as eliminate Reg SHO. Borrowed shares must be located IMMEDIATELY. The SEC must also investigate the DTCC records of all failures-to-deliver which occurred before the implementation of Reg SHO.
Additional comments attached.