Feb. 2, 2024
Reducing margin requirements during periods of high market volatility does nothing to encourage free and fair markets or increase market stability. By waiving the additional covering for potential losses and avoiding margin calls it incentivises high-risk positions and removes checks against risky, over-leveraged investments. This rule would make the entire market more vulnerable to catastrophic crashes by encouraging leveraged positions to extend themselves further and expose their risk and losses to more of the market. The purpose of regulation is not to shelter large entities from the consequences of their bad judgement. The amount of redacted material and information hidden from the public that went into this rule proposal also raises serious red flags. The lack of transparency in our financial markets is becoming a clearer issue for many Americans, serving to reduce faith in the regulatory agencies and mechanisms our market functions on. Rule proposals like this weaken faith in the safety, stability, and fairness of our markets. A fair market is a healthy market. Thanks, Andy