March 3, 2009
Please reinstitute the uptick rule immediately, like today. Shorts have figured out the plan – buy credit default swaps on a company, then sell massive amounts of stock short, and then as the stock goes down the company gets downgraded by the ratings agencies and brokerages due to equity capital ratios and debt covenants.
This practice is widespread and it is being employed on a massive scale by many funds.
This needs to be stopped immediately. Companies are being forced into government backstops, capital raises, and bankruptcy.
Please, do something about this now. You should have started with the uptick rule on day one (by executive order if necessary), and followed closely thereafter with other rules, including not being able to buy credit default swaps on companies an individual or fund doesn’t own.
Our whole system is being attacked and annihilated while you do nothing.