Subject: Reporting on Securities Loans
From: Tyler Pugmire
Affiliation:

Oct. 8, 2022

 


The SEC's new plan puts "working families" front and center and helps prevent them from being victimized by financial predators 



Short selling "in the dark" is completely illegal. For example, airlines overbooking flights. There is absolutely no reason for anyone to sell anything that does not exist. This does nothing but harm everyone else but the individual committing the "naked selling." 


Hedge funds use the money from investors who trust that they will make proper decisions. They are essentially playing with "free money" as any losses they incur does not directly affect the hedge funds. As a result, individual retail investors must have the right to see every action committed by these hedge funds, both legal and illegal. There needs to be complete transparency. 


Securities lending activity can hide massively destructive chains of obligation that can even be a threat to national security, and so transparency in this area is more important than it has ever been. The risks associated with reckless securities lending and short selling - highlighted with terrifying clarity following the events of Jan 28 2021, go far beyond any theoretical benefits of secret short selling for “superior returns”. Investor protection comes first. 



Individual investors and working families do not have the money or technology in comparison to that of the hedge funds. There must be a form of protection to help keep retail investors safe and in a completely fair market.