April 20, 2022
I'm writing today to strongly oppose the changes proposed in SR-NSCC-2022-003. The SFT Clearing Service would allow short sellers to continue to manipulate and delay the closing of their positions by essentially manufacturing yet another type of securities lending product specifically aimed at delaying prior financial obligations. The fact that it simply states \"on a future date\" so nebulously is disingenuous at least, and criminal at best. This whole proposal seems like a way for existing NSCC members who have a financial stake in external members, to submit those external members for \"novation\" so they can legally dance around closing previous financial obligations. The NSCC is not our nation's central bank, and should not have similar financial powers like the Federal Reserves RRP Facility. Enacting the proposed changes in SR-NSCC-2022-801 would effectively remove all remaining integrity in US markets.
Page 7, Fire Sale Risk Mitigation, basically describes naked short selling... How long will you let this charade go on for? Taking the central aspect of SFT's that the NSCC is proposing in-hand with the ability to nominate external corporations, they want to manage the orderly fallout from external institutions defaulting? Where in any of that is a free market? If the market (or stocks) can go up organically, they should be allowed to fall in a disorderly fashion as well. This entire proposal just reeks of further central market control... not a free market. institutions that take risks should be held accountable, and lack of government oversight by your office should not be grounds for further centralizing market functions in the hands of a few corporations. The markets NEED to remain relatively decentralized in order to function as an organic medium.
I strongly oppose everything in S7-14-22 and hope the sentiment in my reply is reflected by other individual retail investors. If this is the case, I hope the SEC can see the stark delineation between corporations with massive financial stakes in the passage of these proposed rule changes, and individual retail investors wondering why large financial institutions don't have to play by the same rules. Please do your job and protect the consumers, not the corporations who's sole business model is to bet against companies, both in the US and abroad.