Subject: File No. S7-12-06
From: Al Barone

April 26, 2007

I have no problem with legitimate shorting of borowed stock and in fact think it is healthy for a liquid securities market. However, I have a major problem with unlimited naked short selling by so called market makers. In this era of unregulated Hedge Funds with
vast economic power small companies can lose access to
capital by unrelenting short sales that represent phantom shares. It appears that without limits the number of phantom shares can exceed the total number of shares issued. This situation needs to be corrected.

Small companies are very important to the health of the US economy. Some limits simply make sense and limiting or eliminating the number of naked short sales is required. At the very least, the total number of shares (especially the number of naked shares) created by the securities industry should be available to the investor on a daily or weekly basis.

Please act responsibly.