From: Daniel M. Prescott [danprescott@yahoo.com]
Sent: Monday, November 24, 2003 2:09 PM
To: rule-comments@sec.gov
Subject: s7-23-03:

From; Daniel M. Prescott, Prescott Capital Management

Eighteen months ago, I left a 25 year career managing
client financial assets; most recently as a Sr. VP at
Morgan Stanley and UBS. I am now thankfully free to
"DO THE RIGHT THING" when managing client assets. The
blatant abuses of the customers financial assets and
of the system by those firms and others are 
disgusting. The SEC and the public are now only
scratching the surface of the greatest abuse of all;
short selling and naked short selling. The current
proposed rule changes are helpful but do not address
the fact that unscrupulous trading entities can short
unlimited amounts of stock that is never borrowed.
This is done either through offshore accounts that are
not adequately regulated or directly through the
domestic market maker network. These criminals are
easily able to establish short positions that are
frequently multiples of the outstanding shares of
public companies with very little stock ever being
borrowed. The result of the relentless selling of
unlimited shares that do not exist causes share values
to plummet causing companies to loose credibility, not
be able to attain financing and ultimately go out of
business. How can the public stomach a financial
system that allows the basic law of supply and demand
to be violated with the creation of unlimited supply
of stock vs. steady demand? When companies fail, the
short sellers say the were justified because the
failed companies were no good and they were just being
smart. The reality is that the game is rigged! The
abused companies market caps decline to near zero so
they then fall under the radar screen of the
regulators and the investments by many unknowing
investors has been wiped out! The final ultimate
insult is that the HUGE ill gotten gains made by the
criminals may not ever be taxed because when they
drive a company out of business the do not have to
close out the short position because the stock no
longer trades! The investor gets robbed and the US
Treasury is denied much needed revenue. As companies
are being put out of business jobs are lost and
economic progress slowed. I have more to say and
information to give to those wanting to "do the right
thing" I can be contacted at danprescott@yahoo.co or
phoned at 314-374-5080. Thank you


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