September 18, 2008
Dear Sirs,
Drastic changes to the United States Stock Market systems are needed to guarantee their survival.
Our Markets are no longer an investment market. Value of individual companies make no difference to the price of their stock. The price of companies stock is being manipulated by Hedge Funds (unregulated and non-transparent) and the like. Individuals investing in good US companies because there is apparently good value are continually at risk, not because of Company risk, but because it is uncertain whether unregulated/non-transparent hedge Funds can destroy stock prices and ultimately the underlying company. This is done frequently by ganging up in a short selling frenzy.
Even though the SEC says they will enforce naked short selling laws, the abolishment of the uptick rule has made Hedge Funds efforts to crush a Company’s stock price easy. Return the markets to investors before the markets fail.
If you want Hedge Funds to continue to run the markets as a casino, then let them have their own market that lets the real investment markets run efficiently. In that way they can destroy themselves without destroying real investors and the economy.
Don’t listen to academia’s nor those results from “up tick rule” studies that are tainted by self-interests. Just look at what is happening in the markets today. Look at the speculation in the oil markets that took the price of oil from $70 to nearly $150 and back to $90 in a relatively short period of time. That price action in retrospect is not related to the supply and demands, but strictly to speculation. This is action dominated by fear and greed; having nothing to do with fundamentals.
Wake up and address the real problem; unregulated, non-transparent, law breaking Hedge Fund Cowboys who are destroying the markets.
Sincerely,
Jack Fawcett