May 14, 2009
Please stop the use of inverse ETF's on a day trading basis. I would favor an absolute ban of inverse ETF's, as they promote market voliatility, reward destruction of catpital, and reward day traders over long term investors.
Broaden the discussion to ban day trading all ETF's and we would be the better off for it, but first focus on inverse ETF's. DO NOT HAVE AN ETF EXCEPTION TO ANY UPTICK RULE OR THE EXCEPTION SWALLOWS THE RULE. Don't let these "investors" convince you that it's an "important part of their investment strategy," as I read one short eselling ETF trader say.Of course it is. They GOT RICH WHEN THE MARKET DIVED THEY WANTED IT TO DIVE, AND BUY "GEORGE" WHEN ENOUGH OF THEM BUY PRO SHARES "DOG,""SKF",SRS....IT WILL DIVE AGAIN.
Ban or restrict inverse ETF's. Give the long term investors a chance.
I bought more Intel for what I thought was a good deal a few weeks ago, and more Microchip months ago at 19, These are two of my favorite stocks.THEY BOTH PAY BIG DIVEDENDS, AND I PLANNED ON OWNING THEM FOR THE REST OF MY LIFE. Then, on Bloomberg one night a couple weeks back, I heard a Goldman Sachs trader say he liked both stocks, but "wait til Micro Chip is at 19," about what I had bought it at two months earlier during the panic. At that time MCHP was 23, and Intell almost 17. It was clear what happened, and I could see the writing on the wall. They were "overbought." The short selling ETF's were employed to drive the share price down, then the big institutional investors moved in to buy of the shares really cheap. They will ride it up, and then short it back down. It's not just financials.For every major sector, there is an inverse ETF, assuring that only those who buy, sell, buy, sell will be rewarded.
Look at the chips for the last two weeks.It's clear in the charts.
These people are not satisfied with long term moderate gains, but are only satisfied making alot of money very fast.
DESTRUCTION OF CAPITAL FOR THE SAKE OF SHORT TERM PROFIT IS THE ONLY ANSWER TO THIS MARKET.WE DONT HAVE TIME TO BUY AND SELL ALL DAY, AND DONT WANT TO.IT MAKESME SICK THAT MY MONEY, MEANT TO GO TO INTELL TO INVEST AND GROW IS GOING TO A DAY TRADER.
If you don't regualte this fast, we are will be in big trouble fast, because people are loosing coinfidence faster every day. Me, I'm buying hard asset gold and bailing out entirely if I'm not satisfied with SEC'S action on SHORT SELLING, AS THIS IS REDICULOUS.
Many are already throwing in the towell, and I'm telling you, while it's so profitable for the few in a down trending market, what right minded person would hand their money over to Wall Street's short sellers. I am ready to throw in the towell, and all of my 10 employees have no faith in the market.
I am afraid that they inverse ETF"s have such an in-road so fast that we have overlooked how destrcuive they are.I fear that these profiteers will convince you that they "police the market." Let them use options, and ban Inverse ETF's, or make them only tradable after a 24 hour holding period, but do somthing now. Until you do, we will get nowhere.
Strong companies will always be "overbought" to Mr. Goldman and week companies suceptable. "Overbought" is the term dejour for anything a short seller wants to drive down and buy cheaper. Look at MCHP and INTC over the last week or so, and compare it to Pro Shares Inverse ETF for the chip sector over that same period. Mr. Goldman wanted MCHP at 19, and by God, he got it. Chip manufacturers are a major employer in the USA. Intell is investing billions of dollars in Oregon now, creating jobs, and employing capital. I WANT INTELL TO HAVE MY INVESTMENT MONEY, NOT PRO SHARES INVERSE ETF INVESTORS.
SHUT THIS INVERSE ETF DAY TRADING DOWN, BEFORE YOU SCARE ALL OF US AWAY