Subject: File No. S7-10-04
From: Frank Christensen

January 7, 2005

Jonathan Katz, Secretary
U.S. Securities and Exchange Commission

Re: File No. S7-10-04 Proposed Rule on Regulation NMS

I want to thank Chairman Donaldson, the commissioners and the staff of the SEC for all their hard and productive work over the last year. They have achieved an agenda that will result in competition, investor protection and enhance our ability to remain the global leader in Capitol markets. This was accomplished with public comments and hearings, while providing total transparency.

Having said that, I need to address the last minute stealth proposal, that if adopted, in any form, would lay waste to all of the above. At first the CLOB gives the appearance of being beneficial, however when its consequences are fully understood, the opposite becomes apparent.

Markets by mandate will destroy price discovery, competition and reduce public orders to nothing more than merchandise, subject to internalization and payment for order flow. I listened carefully to the commission’s Dec. 15 webcast, which focused on this proposal. Among the many concerns, statements of “Do no harm” and “Unintended consequences” were invoked.

As further evidence of Unintended consequences, major participants in the hearings on NMS, that could not agree on anything, have found common ground in rejecting this proposed CLOB.

Given all the good the commission has done, I am sure in the end it will do the right thing and let our markets continue to be the best in the world. Thank you for the opportunity to make comment


Frank Christensen Member NYSE