Subject: Rules & Regulation
Date:    2/15/98 1:57 PM
     
     
Sir:
     
As the president of VanClemens & Company Incorporated and member of the NASD 
I would like to send you a brief comment on a couple of issues.
     
First, I would like to tell you that I strongly feel that the ECN system 
should be disolved. My small firm cannot compete nor afford to access ECN's. 
We simply do not do that kind of volume to make it pay for itself. The major 
complaint I see from customers is, is that when an ECN is the inside market. 
For instance, ABCD stock is being quoted 20 - 20 1/4. My customer sees that 
number and believes that is the current market price for the stock. The 
problem I have is, is that the real market is 19 15/16 - 20 3/8 (market 
makers). I tell the customer that he will get 19 15/16 for his stock less a 
commision and all of the sudden I get an earfull that the stock is bid at 
20. I tell him, I'm sorry, that's a system set up for institutions. Now 
really what can, would, should I do? You cannot advertise a price of 
gasoline at $.97 per gallon then tell the old man who pulls up that the real 
price of gas is $1.09 per gallon and that the cheaper price is for people 
that belong to a close knit group of gas buyers and sellers.  As a gas 
station owner, I am not going to eat the cost of selling this guy gas at the 
competitors price when I have to pay higher myself or do business with my 
competitor just to stay in business. Simply because business like that don't 
last very long.
     
I say kick the ECN's off NASDAQ, period!
     
Solution, Let everybody who has an order just throw the order out there. 
That way everyone will be a market maker. 
     
Second, I want everyone at the SEC to take a long hard look at what you are 
regulating. Sit back in your chair for a second and pause for one minute. 
Okay good, Now is securities medicine? We all need medicine don't we? The 
price of medicine isn't regulated. Any store on the street can sell Asprin 
at any mark up he wants too. Yes he wants to stay competitve but there's no 
rule that says he can't mark up medicine any higher than 5%. Are securities 
food? Are securities houses? All these thing are competitive but no one 
regulates these. Maybe they should be. When was the last time you bought a 
pizza? Did that pizza man tell you what the mark up was? Do you think he 
would? Do you think he even knows.
     
Securities are not life and death. People are not going to starve to death 
or die of cancer because they didn't buy a stock. 
     
My point is this, the SEC has to rethink what it is regulating and get rid 
of these crazy worthless rules! My God the regulation manual is thicker than 
a Minneapoli telephone book. The type face is the same size too! Sometimes 
twice a month if not more 20 pages of new rules come out. Most of the rules 
in the book have no meaning anymore because situations don't exist. 
     
Yes, I hate fraud, but when the NASD manual and the SEC manuals are three 
times thicker than the FAA's Federal Aviation Regulations manual. Wow! Who 
is thinking? Pilots and airlines have peoples lives in their hands. Stock 
brokers have peoples money in their hands. People can earn money but once 
you have crashed an airplane and killed everybody, there's no turning that 
around. And yet, the FAA has mostly kept it simple. (They are not perfect 
either).
     
Please feel free to contact me in regards to this. You may call my office at 
507-282-6556.
     
Sincerely,
     
Chris Vanyo
President
VCLM