Dec. 28, 2022
December 28, 2022 Dear Reader, I am commenting as an individual retail investor, and much of what I have to say is a reiteration of the basic principles and norms that are espoused by the same parties who disregard these ideas. In general, I find that the financial markets have departed, substantially, from the principals of fairness, of public interest, and of general morality. In today's market, it seems that the largest players, institutions, and bedrock entities are justifying the means of their actions by the outcome they produce. Market Makers maintain conflicts of interest with their trading affiliates, institutional traders conspire to move markets in mass, and retail traders are led to slaughter through outright lies and propaganda. While the SEC does an admirable job in policing these activities, their toothless position (as wrought from years of degradation through lobbying for exactly that) is akin to trying to police a highway by wearing a pair of roller skates. I applaud the current SEC administ ration for their efforts to make a difference, and for providing this platform to speak, but my faith in our system is hopelessly diminished. Sadly, I do not speak alone, the masses are speaking with me. The question of Best Execution is one of many facets. To be fair, the term \"Best Execution\" is a terrible misnomer and, at best, quite vague. Who is the execution \"Best\" for? On its' face, one would sure conclude \"for the retail trader, the customer and client for those fiduciaries who are executing that trade\". That, however, is not the case. The Commissions proposal seeks to address that question, to fulfill the goals imposed to reduce conflicted transactions and impose review and documentation requirements. This is, far and away, a massive improvement in the current system. The problems that this rule seeks to address are not only replete throughout the industry, they are actionable acts of fraud and downright theft in favor of the broker, trader, or market makers own interests. Payment for order flow has become a household term for this reason: it is deplorable to think that those who call themselves trustworthy and professionals are repeatedly skimming off the top in undisclosed, or vaguely declared, relationships with other bad actors. This is akin to front-running, a concept and act that has long been illegal. Any and all action that can be taken by the SEC for the improvement of the quality of data, analytics, and general information for retail should, and must, be taken with force and speed. The tools available to the modern retail trader are laughably archaic and place them at a severe disadvantage in a game where ones bank account already dictates who has the most power. Market Makers make markets move, hedge funds cause avalanches, and all tides rise and fall with the whims of the too-big-to-fail banks. Yet, despite this inequity in power, there are those that claim that retail does not need best execution, does not benefit from this information, or it would be too costly to do so. One Trillion Dollars. That is the amount of profit reaped from the Market over the past 10 years. Fractions of a penny matter when those fractions are taken millions, billions, trillions (and more) of times. The sheer numbers dictate nothing less than imposing a best execution standard, in favor of t he financial principal (and not the fiduciary), and that is even before considering the additional merits of such a rule. Imposing Best Execution, and requiring the reporting to enforce it, gives retail traders the opportunity to review the costs incurred outside of a invoice. I, as a retail trader, may choose to pay my broker for a trade rather than have him gain money on the back end to route my trade through a notoriously unscrupulous market maker. I can utilize my assets, my money, in a way that I choose and there will be consequences, and verifiable data, if it is not done in the way I have chosen. Market participants have taken away the autonomy, choice, and power from the retail trader in small increments and handed us back an IOU saying Trust me Bro as they gamble away retirement funds or degrade our interests by splitting the profits on a less-than-best-execution with their kickback giving comrades. Imposing this rule is not just a good idea, it should be mandatory.