July 14, 2020
Comment against proposed rule change S7-08-20:
While the size and makeup of the US equities market has indeed changed drastically over the last 45 years, so also has the need for transparency in this industry in particular.
The 13F document is already so lean on information it boggles the mind that anyone could consider its quarterly filing a burden. A list of holdings could hardly be simpler to automatically generate. Indeed, as an individual taxpayer and investor, my Form 8949 in TY 2018 spanned 7 pages, none of which I filled out individually. I can't imagine who, even if only a single person, could possibly be burdened simply by disclosing holdings on a quarterly basis, regardless of the quantity, in the the year of Our Lord 2020.
The question of burden can be easily dispatched. Now one can turn our attention to the utility. Regardless of the level of burden, if there is no utility to We The People, there is an argument to be made. And once again, it is a silly one. From the industry that brought this country the Great Mortgage Crisis of 2008/9/10/11/12/13 comes a claim that 90% of firms can be trusted to operate without disclosure. This is akin to allowing 300M US citizens to not file a tax return, to rely solely on their W4 to accurately assess their taxation and assume that each of them is acting in good faith. This scheme would not garner much support and rightfully so.
Lastly, disclosure rules appear to be the only means by which the SEC can reliably enforce regulation in the financial industry. Thusly, allowing a great many smaller firms to escape the primary means of enforcement can only reinforce the brazen abandon with which the entire financial sector treats the life savings, pensions, retirement accounts, mortgages and houses, and college educations of US citizens. The SEC is in need of every possible tool to enforce law on this industry and on that ground, this rule could not be more wrong.