Subject: File No. S7-19-07
From: Louise Murray

January 28, 2008

Chairman Christopher Cox
Securities and Exchange Commission

Re: Regulation SHO Threshold Securities

Dear Sir,

It is with dismay that I write to comment on Regulation SHO and the disappointment many investors feel, as I do, that the SEC has failed to resolve this ugly situation of failed to deliver securities, which has resulted in counterfeit shares circulating in the securities markets.

The commission allows the NYSE broad jurisdiction in allowing FTDs. They allow the "NYSE specialist to continue to fulfill its obligation to maintain a fair and orderly market pursuant to NYSE Rule 104, a temporary exemption from the close out and/or borrowing requirements of Regulation SHO, 17CFR 242.203 (b)(3), may be recommended by the New York Stock Exchange and granted to the NYSE specialist in the security, by the Securities and Exchange Commission. The temporary exemption would normally last no longer than 30 days but may be renewed, depending upon the particular circumstances. The fact that a NYSE specialist has been granted an exemption will initially remain confidential to protect the NYSE specialist's position in the subject security."

Now, the SEC insists that those company's names are published daily. Is this so? NovaStar Financial (NFI, NFIPRC) has been listed on the NYSE through January 16, at which time they were de-listed from the NYSE and moved to the pink sheets.

So, what happened to those millions of FTDs that have consistently been listed on the Threshold List, and in September exceeded half of all shares issued by NovaStar?

What happend? For three days they were listed on the Nasdaq trader, and now are missing from the list. Did the institutional holders suddenly rent out four million of their shares, which is a tall order, considering the fact that less than ten million shares have been issued? Did you determine it was not an issue when settlement day for those issues arrived?

Please explain it to me, so that I can understand.

I'm quite sure it is yet another secret which may not be responded to, thus allowing it to remain confidential, protecting the NYSE specialist's position in the subject security.

The delayed release of the number of fails at settlement is just a start. Now, it is time to release current, daily, FTDs of each company affected.

The investor, whether private or as a group, ALL should be privy to the number of fails at settlement at the close of day. It is, actually, an illegal activity, and highly manipulative.

The SEC's primary purpose is to protect investors. That may conflict with the wishes of the broker/dealers, the hedge funds, the NYSE.

Are you ready to eliminate the exceptions given to those that manipulate the markets? I truly hope so.