Oct. 18, 2022
CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Secretary Countryman, I fully support the proposal S7-08-32: Short Position and Short Activity Reporting by Institutional Investment Managers This is one of many necessary rule changes to ensure a free and fair market, of which the SEC so often touts. Transparency is critical for fast and efficient price discovery. As noted within the proposed rule "while short selling can serve useful market purposes, it also may be used to drive down the price of a security, to accelerate a declining market in a security, or to manipulate stock prices" (pg 5). Short selling is a position with theoretically unlimited risk potential, and thus, a lack of transparency in these short positions increases the potential for substantial losses leading to systemic risks in our financial markets. Thus, the SEC should enforce "buy to close" in addition to reporting "buy to cover". Prioritizing liquidity over price discovery has predictably led to problems. There is no situation outside of Wall St where artificially increasing supply would be tolerated and significant penalties exist to deter and punish such behavior. Enforcing requirements for short sales to borrow stock is a natural solution promoting price discovery through costs to borrow with the additional benefit of simultaneously preventing attempts to manipulate supply. It is absolutely unconscionable and remarkably unethical for the SEC to consistently say the stock market is "free and fair" when institutions regularly commit crime before our very eyes. Shorting, swaps, FTDs, and many other aspects of the stock market lack the transparency and regulation needed for well-ordered and stable markets. Thank you, Nick Ahlers