From: Joe Gormley [gorms@yahoo.com] Sent: Wednesday, October 24, 2001 12:35 PM To: rule-comments@sec.gov Cc: joe@gormleys.com Subject: comment on display requirement changes Joseph J. Gormley III 304 Kenwood Drive Moorestown, NJ 08057 856-222-1397 joe@gormleys.com October 14, 2001 Mr. Jonathan G. Katz, Secretary Securities & Exchange Commission 450 Fifth Street, NW Washington, DC 20549-0609 Dear Mr. Katz, I am writing this letter in regards to the Super SOES reserve size display requirement & refresh increment changes. NASDAQ has filed a rule proposal with the Securities and Exchange Commission to eliminate the 1000-share display requirement when using Super SOES reserve size after only two months of trading. After an extremely low volume month of trading in August and a partial month of trading in September due to the tragedies in New York I doubt there is enough data to justify such a rule change. It is my opinion that this rule change will harm investors and take away what integrity Super SOES has added to the NASDAQ stock market. I am hopeful that the SEC is of the same opinion since they denied several previous versions of Super SOES that did not include the new refresh changes. By denying NASDAQ’s request for these changes you can quickly prevent them from creating a less transparent market. The entire proposal is geared towards giving back to Market Makers some of the tools they use to manipulate the market. They have plenty of tools for that already. Why should the Market Maker be allowed to hide their reserve size at all? I think asking them to refresh to 1000 shares takes away their ability to slow down the movement of a stock. I disagree with letting them hide reserve size at all, however at this point in time that is all I am asking for. Since the implementation of Super SOES Market Maker’s are now using ECN’s to hide their size and refresh on the inside market indefinitely for 100 shares. Allowing them to refresh indefinitely under their own names gives them additional power to slow down the markets. This type of change will prevent small investors such as myself from participating in the markets. In a market that has been suffering from lower volume I believe that creating a more even playing field is in the Market Maker’s best interests as well. The removal of the 1000-share display requirement does not achieve that objective. Although I have brought up other points regarding ECN’s and Market Makers showing all of their reserve size the focus of this letter is to point out that any change in Super SOES so soon after it’s implementation is a mistake. Super SOES took two years to implement and any changes should be studied at length. The NASDAQ Head Trader alert gives three weeks notice of these changes. I’ve never seen them act so fast. The fact that NASDAQ would even attempt to sneak in a change like this that will negatively affect so many small investors is a crime in itself. As a small investor who depends on your organizations continuing efforts towards a faster, more transparent and liquid marketplace I must urge you to reconsider and ultimately deny this rule change. If you do feel that these changes are warranted I would be very interested in receiving correspondence explaining why. Please add my address and or email address to any distribution lists you may have. Sincerely, Joe Gormley Small Investor ===== Sincerely, Joe Gormley joe@gormleys.com __________________________________________________ Do You Yahoo!? Make a great connection at Yahoo! Personals. http://personals.yahoo.com