April 10, 2007
Subject: File No. S7-12-06
The Honorable Christopher Cox, Chairman
Securities and Exchange Commission
100 F Street, NE
Washington, D.C. 20549
Dear Chairman, Ladies and Gentlemen of the Commission,
I hereby submit the following article that I find germane to the issues at hand,
Q4 SIA Data on NYSE FTDs and FTRs hits $82 Billion
Location: Blogs Bob O'Brien's Sanity Check Blog
Posted by: bobo 4/2/2007 3:09 PM
Is that bad, when your FTDs and FTRs hit $82 billion, for just NYSE member firms?
View the data, direct from the SIA's own website, yourself. Lines 69 and 103 are usually the really fun ones. Select the NYSEFirmsTotals.xls spreadsheet.
http://www.sia.com/research/other/
I mean, I know we are all supposed to believe that there is no big problem, and that this is all the nutty ramblings of the hopelessly deluded. But $82 billion, up from $55 billion in Q3...
Is that Reg SHO working, do you think?
The industry can largely ignore Bloomberg's expose, and even when Cramer basically comes out and admits the type of larceny that is the Wall Street norm the Street can duck it. Because if it just ignores things with enough concentrated effort, the reporters who make a living sucking at the Wall Street milk tit, pretending to expose scandals while they chuckle in contempt at the rest of the country, will reinforce that there is no problem, and then the fat, spoiled, ignorant populace will go on to the next thing, and forget what was being discussed. Pretty good bet, so far. Sort of like making it so abstract and distant that it's just not real. Like watching unarmed civilians being gunned down by troops - it all seems so distant and, well, surreal, it just can't be happening. What's on American Idol this week?
Sure is a good thing that the un-indicted co-conspirator of Elgindy, per court docs, was persuasive enough to cause the SEC to delay reforming Reg SHO so that his demands for new comments could be satiated. I mean, that is so nice of them. Really. To allow a professional short selling associate of a convicted naked short selling felon to halt reform. Wow. I actually am tearing up. I'm absolutely sure that is what the 1934 Act envisioned when it created the SEC.
Oh, but there is no problem. I keep forgetting. $82 billion. Is that a bigger number, or a smaller number, than $55, and before that, $63 billion? Maybe $82 is actually a better and smaller number. Has anyone been able to get the DTCC or SIA or SEC to comment on that number? All I've gotten is stony silence. I know there are journalists that have asked. They can't seem to get a straight answer either. Why is that? Everyone is reassuring us that the theater isn't on fire, but nobody can explain these massive numbers.
And let's not forget that is just the NYSE member firms. It doesn't include ex-clearing, or pre-netted fails, or international clearing houses (who I'm led to believe hide orders of magnitude more FTDs than the domestic numbers reveal).
Heck. $82 billion in today's marked to market valuations, concentrated in a few stocks. Wow. But no problem. None at all. Nosirreee. Just business as usual. Move along. Keep putting your money in the market, and ignore all that.
Frigging unbelievable. Really is.
---------------------------
I was alerted as to a new feature on the Overstock.com site, which basically does what Wikipedia claims to have done - creates a repository for knowledge that is real time editable and editable, absent the sock puppetry and petty tyranny of Wiki's little clique of administrators and demagogues.
You can view it here, along with one of the more compelling entries.
http://omuse.overstock.com/wiki/Understanding_Naked_Shorting_Stock_Manipulation#The_Normal_Settlement_Process
http://thesanitycheck.com/BobsSanityCheckBlog/tabid/56/EntryID/595/Default.aspx