May 4, 2009
It is imperative that there be a reactivation of the uptick rule, along with introduction of a circuit breaker to stop running down stock prices by hedge funds and other stock manipulators. Specifically, SEC has an obligation of making the markets open and competitive to everyone, not just large money movers such as those who contributed to manipulating of the bear-market in the past 9 months.
Of the proposals, the SEC must enact the Proposed Uptick Rule: A market-wide short sale price test based on the last sale price or tick, along with a second protection involving the circuit breaker that would either ban short selling in a particular security for the remainder of the day (or even longer) if there is a severe decline in price in that security (a halt rule).
These should be kept simple, straight forward, and transparent to all.
SEC must admit it has made mistakes in the removal of the uptick rule in 2007. Joe Kennedy knew what he was doing when the original uptick rule was established. Human greed does not change over decades. Fix the problem, and reinforce this learning to future generations.