Subject: File No. S7-08-09
From: Jon A Alexander
Affiliation: Investment Manager

September 20, 2009

I manage assets for clients and feel contempt for the slow response to the wreckage that has occurred as a result of the lifting of the uptick rule.

I concur with the American Bankers Association, along with countless others who were shocked the uptick rule was repealed in the first place.

Ironic how the SEC also changed the accounting rules for banks and imposed mark to market accounting at the same time. Thus giving ammunition to the shorts, forcing huge unnecessary write downs and a need to raise capital at a time that the shorts were able to murder the stocks with ruthless bear raids and draining their ability to sell stock and assuring their demise.

How ridicules that you pull the rule under a pretense that it was "no longer effective" (Cox's words not Shapiro's) yet then to reinstate you must go through an extraordinary review and then a second review, panels, letters etc.....only shows that the SEC appears to cater to the hedge funds and exchanges that both profited handsomely at the demise of the US Economy, Banking system, and countless companies. All were affected by the perfect storm that was brewed up by the SEC. The allowing of an increased leverage of the 5 largest Financial institutions to 40 to 1 in 2005 by Donaldson. Assuring weakened vulnerable balance sheets with crappy CMO's.
You turned your back on the Credit default swap market allowing 50 trillion of risk exposure to balloon under your nose, allowing yet another unfair advantage to the short sellers.
Then pulling the uptick rule and then changing the accounting system that had been in place for 70 years to mark to market. End result, destruction, financial meltdown, nationalization of America's most prized institutions. It is criminal what has happened at the hands of the regulators. And now it is silly that you actually have the audacity to demand empirical evidence that short selling caused any of this.
How about the 30 million shares that failed to deliver on Lehman the week the shorts killed it. Isnt that an obvious smoking gun? Where are the fines for that obscenity? Naked shorting went through the roof this past year because the feeding frenzy was made so attractive by no uptick, mark to market and extraordinary bets made on credit default swaps. (Imagine if everyone in your neighborhood was allowed to buy fire insurance on YOUR house.....guess what the odds are your house burns someday)
None of this matters in this new world of over blown governmental powers and who knows who really runs things at the top.
But if any of you have a conscious and can put the greed and corruption aside, you will reinstate a reasonable uptick rule that really works...(the bs about inefficient price discovery if you don't allow shorts to manipulate is a funny one. Price discovery happens all the time without the added selling of artificial units. Buyers and sellers determine price....adding additional sellers only can distort to the downside first then upside later....silly).

Then if you will actually enforce the rules against naked shorting, and you reinstate accounting rules that do not force the cyclicality of mark to market.

Give the markets back to the investors and to the companies that list their shares there, and stop this casino you created that only helps the hedge funds, sovereign wealth funds, and the exchanges with over blown volume from fake shares trading.
Jon Alexander,
Portfolio Manager.