April 19, 2009
-Dear SEC commission,
It is with great interest that I write to you. My grandfather made his fortune in the stock market as did my father and now myself. There is a rich history passed on of at least 70 years of investing.
First of all the problems today have come about for a number of reason that I will not waste any time on. But here are my thoughts on changes that need to be implemented.
1. We need an SEC that will enforce the ruleslaws. As we have seen with all the recent ponzi schemes, it is all too easy to get around the current structure that we have in place. We must have an SEC that will enforce and mandate the complete end to naked short selling. Institutions caught NSS will be fined $10,000 per each share.
2. I have made lots of money and I have lost lots of money on different companies, some went broke and some went up 500%, the whole time the uptick rule was enforced. The rule needs to be re-instated exactly as it was. Bad companies still go out of business, with this rule in place.
3. Trading of shares needs to go back to a .05 not a .01, thus allowing blocks to fill easier, producing less violent swings up and down in a stock.
4. Rules and or information must be changed that give individuals help from being trampled by institutions. As an example short interest by institutions must be gathered every Friday and reported to the public every following Tuesday or Wednesday, This is easy to do with the technology today.
5. This could be the most important and revelant of all changes. I do believe short interest has a place in this market. But what has to be changed is the borrowing requirements for both margin accounts and for shorting of stocks. Currently these standards are very LOOSE by the trading institutions and if there was legislated or set amounts this would also curb wild swings to both the up and down side trading of shares. An Example Marginborrowing set and 50% of face value of an account as might also be the same for shorting.
6. Options, experiment with limiting the quantities of calls and puts allowed per company, as the hedging by institutions, is generally complicated and gives them advantages over most individuals who do not understand this type of an investment startegy.
7. Same day reporting on Sec Form 4 insider trading.
8. This is more apt to be for the IRS, but here goes. When a corporation has a bad year it can go back and income average for 5 years, individuals can not. NOT VERY FAIR. Also on Capital gains we must report ALL gains, but we can only write off $3000. per year. Corporations do not follow this rule either. There are so many investors currently under water it will take them a lifetime to recover from their losses. We need have the SEC and the IRS work together and raise this amount substantially. Also how come if a foreigner comes to America and starts a business, they do not have to pay federal tax for 7 years, and we Americans do not get the same break?
Why does the government mint a penny when it costs more than a cent to produce? Because when it comes to loosing government jobs, the government will not allow this to happen, when a company produces a product that costs more than it sells for, they generally go out of business and people loose their jobs.....I am not talking about recent BAILED out companies....just the fact they get bought out or go out of business, but the government is nearly never efficent or on top of implementing good ideas.
thank you