October 30, 2009
Dear Chairman Mary Schapiro and all SEC professionals,
If the uptick rule is not reinstated for whatever reason, then I predict during the next ten years, the market will have another financial meltdown. Why? The removal of the uptick rule simply allows the linking of derivatives with cash instrument for a coordinated attack. As we all know, derivatives and leverage are the single most important cause for market crashes.
Late 2007, I had written to the SEC warning about the crashes of individual stocks and finally the crash of the stock market thanks to the absence of the uptick rule. Everything turned out as predicted. The repeal of the uptick rule is simply the key important factor in the destruction of wealth. The hedge fund people and greedy brokers have used many illegal tactics such as naked short selling, rumors, insider trading, front running, etc., to reap obscene profits at the expense of small investors
I hope the SEC will do the right thing and reinstate the uptick rule quickly.
Dan Nguyen, CFA.