April 20, 2022
This is an egregious criminal overreach and is an utterly corrupt attempt to remove all risk from short selling.
This is extremely damaging to US stock markets and as an overseas investor it leaves me shocked that the NSCC would countenance passing such a blatantly unfair and asymmetric rule.
It allows the build up over time of infinite amounts of fail to deliver equities, resetting the obligation timer every time the facility is used for these. There is zero onus on participants to deliver shares they have nakedly shorted. What is proposed is a way to endlessly kick the can of obligations down the road, leading to a complete distortion of the normal process of price discovery in a functioning market.
International governments and financial institutions will be appalled that this rule is being proposed in a country that is supposed to be a beacon of economic prosperity and democracy. It is more suited to an oligarchy than a democracy.