Subject: File No. S7-19-07
From: Karl Schreiber

August 13, 2008

Dear Commissioners:

I find the SECs many new rule proposals, re: FTDs, a waste of resources, yours and ours. The Customer Protection Rule 15c3-3 of the 34 Act clearly states, quote: A broker or dealer shall promptly obtain and shall thereafter maintain the physical possession or control of all fully-paid securities and excess margin securities carried by a broker or dealer for the account of customers. Section 17A (34 Act) mandates they must, quote: Promptly and accurately clear and settle all securities transactions. This seems extremely clear to me, FTDs are illegal and you do not require any new rules. I also do not see anything about T+13, or T+NEVER in either of these regulations. With the advent of the computer era, one would think that T+1 is surely achievable.

It is time the Commission re-thinks what it is doing as far as regulating the markets. Maybe it is time to go back to basics. Reread the Congressional mandates given to you in the 1934 Act to see if, in fact, you are adhering to those mandates in both rule and spirit.

You are the regulator that is supposed to bring INTEGRITY to the market. Please show us that INTEGRITY. Are you actually protecting ALL investors, or just those with JUICE?

In deciding on how to regulate the markets, one needs to look at the reason we even have markets. I believe that markets were originally established to allow Companies access to new capital and investors a chance to participate in the growth and profitability of those Companies.

The markets have now evolved into Casinos. As we all know Casinos give the inherent advantage to the house. The house in this case is the Broker/Dealers who take a commission on ever trade, but unlike the Casinos, some Broker/Dealers seem to be taking undue advantage of their small customers. They are Failing To Deliver what we investors think we have bought. Besides that, they may be loaning shares from our accounts to short sellers who do not have our best interests in mind. I believe most small investors who have invested for CAPITAL APPRECIATION do not even know that this may be happening to their accounts. They still have voting rights, but so do the new buyers of the borrowed shares. This leads to more than one owner of a single share and over votes. How can this be?

There has been much discussion about the roll shorting plays in the markets. Yes, it does add liquidity. The question in my mind is is this good liquidity, or bad liquidity? Capping a stocks advance will surely add liquidity, but if this is done to manipulate the price, then that is unfair to investors. Large well capitalized Hedge Funds appear to be doing this with impunity.

I think that you really need to look at the value that shorting brings to the market. I believe that you will find that shorting does not add anything of value. It is just another way for manipulators to gain an advantage at the expense of the small investor. Only in the stock market does one have a means to sell what one does not own. One would end up in jail if this were done with any other property.

Please also completely eliminate the option maker exemption and reinstate the uptick rule with a meaningful value.

You will know when you have solved the FTD problem as you will have no need for the Reg. SHO lists. If this can not be done relatively soon, then you should do away with shorting entirely. Of course, you will hear much screaming from the abusers, as has happened when you put you emergency order for the special 19 in place.

Thank you,

Karl Schreiber