Subject: File No. S7-08-09
From: Edwin Hawkins, Mr.
Affiliation: none

May 5, 2009

I'm an individual investor who relies on the stock market to earn some money during my retirement (vs. putting money in the bank at a safe but low interest rate). I would like to see something done to prevent short selling that knocks stocks down so quickly. The following is a case in point, which I am still reeling about.

One of my largest holdings is ENGlobal Corp. (ENG). Last August the company reported an outstanding 2nd quarter and the stock price jumped to more than $18.00. It held in the $17.00 range for a while before starting to take a tumble by the end of September. Before I knew it, like the banks that were either going out of business or were being considered for federal bailout funding, ENG got hammered down to the middle $2.00 range in November. In 2-1/2 months the stock lost 85% of it's value. There's no way that should have happened, at least not legitimately because ENGlobal was NOT like the banks and mortgage companies on the verge of collapse.

Part of the downturn was Hurricane Ike that caused the company to have a short term reduction in income, which was reflected in a less than robust 3rd quarter earnings report in November. But the company was still making decent money and was not in jeapordy like the failing banks and mortgage companies. Without an uptick rule in place, it simply didn't matter.

The reason I didn't sell my holdings when the stock price peaked in August was because a large percentage of my holdings was for less than one year and therefore subject to the much higher short term capital gains tax. I was only a couple months away from having a large chunk of my holdings become eligible for long term capital gains. But by the time that occurred it was too late and the damage was done. In retrospect that was a huge mistake on my part, but I NEVER thought the stock price of a stable company could lose 85% of it's value over such a short period of time. I've learned my lesson the hard way.

My belief is that if the uptick rule was in place, the short sellers could not have driven down the price so quickly. Some days it was carnage for no apparent reason. My retirement savings were signficantly impacted, and now I have no choice but to wait for the stock to recover, which I believe it will do over a long period of time.

I would never consider shorting a stock myself as all of my stock investments are long. If you have evidence that ENG was not driven down by shorts from early Sept. to mid-Nov. 2008, I would appreciate knowing exactly why the big dive occurred. ENGlobal earnings is NOT directly tied to the price of crude, but in my opinion it was the short investors who made it seem that way.

I urge the SEC to implement some type of uptick rule so that fast downward cycles like what happened to ENG does not occur in the future. I don't have a specific preference of the various options being looked at.