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

File No. S7-23-03

December 28, 2003

Mr. Katz:

As a licensed proprietary trader, I am very against the proposed SEC Regulation SHO. This rule would allow short selling to be effected at a price one cent above the consolidated best bid, which is different from the current rule which does not allow short sales to be effected at or below the best bid when the best bid displayed is below the preceding best bid.

As all newly proposed rules are meant to better the marketplace as a whole, I firmly believe that this rule will have a negative effect on the United States markets. This would give an unfair competitive advantage to the market makers at the expense of the ordinary American investors. This will not allow the market to maintain its orderliness as intended by the SEC because the SEC is trying to regulate the movement of the market rather than just allowing the market to move on its own, the way it should and is intended to do. In a free and competitive marketplace stocks will find there true level and this would constrict the real movements of stocks and the market place. Giving the authority to the market makers as to where the market moves is clearly wrong and can become quite manipulative. Reconsidering the implementation of the SEC Regulation SHO must be thought out again and it is imperative to look at the market as a whole when placing new regulations on the market as it can have long lasting negative effects.

Furthermore, ECN limit orders to buy stocks should be filled by anyone willing to sell stock (whether the contra party is flat or long). Let's create a fair and orderly marketplace and let's eliminate this proposed rule. The market needs to move forward and not revert to the days of the past where the big banks and trading floors reaped the largest advantage, whereas the smaller investors could not compete. The market should be fair and orderly for ALL investors.


Michael S. Raffaele
Registered Representative