From: David Klausmeyer [dklausmeyer@houston.rr.com] Sent: Monday, December 01, 2003 4:11 PM To: rule-comments@sec.gov Subject: S7-23-03: Dear Commissioners: It is about time that you are going to further regulate short sales. Excessive short selling can prevent an issuer from raising additional capital and ultimately put him out of businees costing jobs and gross domestic product. I have always likened it to a table stakes poker game where the player with the most money on the table can keep raising until everyone else is forced to fold. In addition to your proposed regulations, I would suggest: 1. You must establish a strong reporting system in order to make certain that the same certificates are not borrowed twice. 2. As an investor, it is most convenient to hold my certificates in street's name. I could prevent the borrowing of my certificates by choosing to hold them in my name and keeping them in my safe deposit box. I would like to have the same right for the certificates that are held in the name of the broker. Therefore I would propose that broker's should obtain the permission of the owner's of the securities before loaning them to someone else. I would not give this permission unless I were compensated by the broker. 3. You have recognized that short selling does not create problems in extremely liquid markets. Conversely, there should be some type of further short selling restraint on illiquid stocks. Some stocks trade every second throughout the entire day whereas other stocks only trade once or twice an hour. There must be some further restrictions on the volume of the short sales in thin markets. Short sales are identified as such and could be locked out of the market until certain conditions were met.. For example short sales should never be allowed to exceed twice the long sales on any given day. Sincerely, David M. Klausmeyer Investor