Subject: File No. S7-08-09
From: Paul J Missonis
Affiliation: investor

May 5, 2009

Personally I beleive short selling should be banned altogeter with the exception that legitimate market makers in a stock should have the abilty to short stocks within some limitiation to maintain an orderly market, but beyond that I don't see there is any real legitimate reason to allow short selling as a practice in equity markets. Commodity trading is different wherein there is a legitimate reason for producers to short sell future delivery of commodities they actually produce. My reasoning on this is that short sellers do not invest in the capital of companies via stock purchases, they hold no voting rights in the affairs of public companies and, yet they are allowed to sell stock in a company they do not own with the sole goal of driving down the value of a companies public stock. By nature shorts selling drives on rumor mongoring with the sole goal of driving down the value of the target companies stock. This activity is "legitimaized" by the shorts in various ways but the bottom line is their goal is to drive down value, reputations etc for their own financial benifit and even if their reasoning is correct it is always the equity holders who suffer as a result. The original uptick rule was put in place to prevent the practice of organized bear raids on the stocks of various public companies and this simple system actually worked by disallowing shorts to create selling panics by driving down bid prices. Since short sellers have no vested interest in the companies they target, why should they be allowed to affect the value of the holding of legitimate investors. At the very least, the uptick rule should be reinstated.