May 6, 2009
I am a relatively sophisticated investor who does employ short selling and puts, both for profit and hedging purposes...therefore I'm hardly anti-short selling when it's responsibly done.
The present proposal doesn't go far enough, in my view. I believe the uptick rule should be re-instated in as close to a fashion as it existed before the rule was suspended as possible, with time limits set at whatever interval is appropriate for this modern age--I understand even a few seconds could be adequate.
What I don't want to see is a watered-down, ineffective version of the rule that doesn't accomplish the goal of preventing shorts from selling a stock down in an uninterrupted fashion.
I'm disturbed by the lack of reference to naked shorting in the proposals. It's my understanding that this practice is already illegal, but simply wasn't being policed against during our recent debacle. This in my view is every bit as important as the uptick rule being reinstated.
The game is definitely rigged against the retail investor as things now stand, and if we want them to come back into the market, and the long-only funds to survive, we must have an effective uptick rule and a return to actively policing against naked shorting.