From: Incoming from Chris Gregg [cjgregg@rcn.com]
Sent: Wednesday, December 31, 2003 9:32 AM
To: rule-comments@sec.gov
Cc: Gregs Email
Subject: subject: File No. s7-23-03

Mr. Jonathan G. Katz                                                                                                        26-December-03
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-0609


Subject: Comments on Proposed Rule changes 17 CFR Parts 240 and 242



Dear Mr. Katz,

                I am writing on behalf of the recent request for comments 
concerning Proposed Rule changes 17 CFR Parts 240 and 242.  As an active registered 
representative with 5 years experience I take exception to some of the proposed 
changes.  In general, I strongly oppose any rule changes that negatively impact 
market efficiency, liquidity, and transparency.    Specifically, I will comment 
on what I see as crux of proposal rule changes: 1) New uniform bid test; 2) Short 
selling locating rule; and 3) Suspension of bid test for pilot program.

Rule Change # 2) Short selling locating rule:  The locating rule will prevent naked 
short selling thus increasing market efficiency and transparency.  These are changes 
that I strongly agree with.

Rule Change # 3) Suspension of bid test for pilot program:  Suspension of the bid 
test rule (provided that the locating rule is in effect) will increase market 
efficiency.  Again, these are changes that I strongly agree with.  

Rule Change # 1) New uniform bid test:  In my opinion, this proposed rule change 
decreases the efficiency and transparency of the market. On the issue of transparency, 
the advent of decimalization and programmed trading has resulted in flashes of bids 
and offers that narrow the spread by a penny (or pennies) without providing any 
additional liquidity -reducing both the transparency and efficiency of the market.  
The proposed uniform bid test rule will only proliferate these tendencies.  

On a more critical issue as to the exception of these requirements (pg 62977 of 
Federal Register/ Vol. 68, No. 215 Thursday, November 6, 2003; first full sentence) 
"The commission is proposing an exception from these requirements for short sales 
executed by specialist of market makers but only in connection with bona-fide market 
making activities."   I strongly disagree with this exemption, and agree with the 
Commissions belief (pg 62989) "the rule to have its intended positive effect on 
the market, all market participants including market makers, should be subject to 
the rule."  It is my observation, that over the years bona-fide market making 
activities have given way to ECN order flow; Market makers no longer provide the 
source of liquidity they once did and thus should not be awarded any special 
privileges.   

The bottom line is that short selling provides liquidity to the market and any 
changes that affect the ability to legally sell short impacts the efficiency of 
the market negatively. 

Sincerely,



Chris Gregg
Registered Principle
Trillium Trading, LLC.
417 Fifth Ave
New York, NY 10016