Oct. 29, 2022
October 29, 2022 I have a big problem with securities lending. There is no real reason it should even exist. Why does anyone need to borrow a security? If you want to buy it, buy it, you want to sell it? Sell it. We dont need entities borrowing shares to short, then failing to deliver, then borrowing shares to clear the failure to delivers. Large firms and brokerages have been fined for not obeying the rules but they dont care because your fine is just to get your cut of the crime they commit within securities lending. Either make it strict, make the penalties worse than the reward of breaking rules or get rid of it entirely. Maybe a blockchain system would allow it to be traceable and transparent.