Skip to main content

Faith Brandt Comment On Regulatory Notice 21-19

Faith Brandt

I am extremely upset at the regulation surrounding short selling and the subsequent naked short selling. Firstly that a stock can be sold without having actual ownership is asinine, let alone not really regulated. I actually think short selling should be illegal as it is similar to stealing and adds unknowable liquidity to the market, diluting the shareholder market and making true price discovery nearly impossible. If you add that already deadly combination to letting the market makers themselves and hedge funds report their short positions when they have knowingly fabricated previous reports to make their positions look less volatile or to mislabel transactions as long as opposed to short. And not only done that but actually programed computers to do that automatically. They reap billions of dollars in profits and are usually charged a few thousand dollar fine. What exactly, is supposed to be the deterrent? Profits exceed losses incurred from fines of wrongdoing, what is the deterrent I ask again. Yes, the short positions need to be reported daily and regulated more, they need to be held to a higher risk management level, they need to be stopped when it looks like their bet was wrong and not be allowed to manipulate the stock market via their super computer algorithms to artificially dilute the stock with fake liquidity , and to be quite honest I do not think short selling should be allowed at all since it is always abused and the ones that suffer are the business and the shareholders. One of the ways that a stock is allowed to be shorted is if the Market Maker has a reasonable belief that the share can be returned. How do you explain the skyrocketing FTDs? They just keep getting reracked and kicked down the road, if there was really a reasonable belief that the shares could be returned and then they weren't, don't you think that would then change to maybe there is NOT a reasonable belief that those shares could be returned and therefore not be able to be shorted? I would think at think point of FTDs we would be at that point. Please regulate the short sellers and get rid of dark markets also, there is no reason they should be allowed to do things without sending it to th NYSE and having it being reflected in the stock exchange. Thank you for your time.