May 7, 2021
I will attempt to keep my comments contained to the form and functional contents of NSCC 2021-002. Although I think what underlies the sentiment of 2021-002 from the DTCC is \"market makers and broker-dealers are taking on way too much risk in the market. the market is susceptible to crashing when this happens. We need to protect ourselves from you or more accurately from ourselves and our own greed.\" This outlines a broad, sweeping problem/sentiment in our financial markets not specific to liquidity deposits and margin call thresholds.
I think the shortening period of these market crashes over the last 40 years is concerning. I think it sheds light on the historical lack of attention to fairness and justice in our financial system. Furthermore, as many insiders are aware, we are on the cusp of another potential crash. AGAIN at the hands of non-retail, non-blue collar or main st. americans. No, instead due to the gross negligence and greed of banks, specifically apparently risk departments (see CS, MS, JPM, BAC, Nomura), and also and those who should be the focus of investigation: the ultra-wealthy, hedge funds, and \"family offices\" lurking in the market, utilizing x20 leverage, acting irresponsibly because history has shown them there are no consequences.
With NSCC 2021-002, a first step in accountability is taken. I see the outline of a form of groupthink concensus which allows other participants to quietly encourage compliant behavior. By tying all of their fates together, clarifying capital requirements and establishing the intraday SLD requirement, I feel it will discourage unnecessary risk taking. The looming threat of a margin call might help to assuage overzealous actors from taking unnecessary risks or overreaching risks.
Further, I find the rationale for extension of the deadline to be inadequate. \"We need more time to read it again and consider the implications\" doesn't give investors any insight into the actual reasoning for extension. All comments submitted thus far were positive, as reported by your agency in the linked pdf document on your SEC.gov website. It has been 45 days since publication, in fairness, what did you do the first 45 days? Why does the SEC feel it appropriate to extend the ability for bad actors to continue to take excessive risks in the market, further threatening another fallout such as Archegos? What concerns does the staff have about inter-related party transactions? Are there any other concerns about \"taking liquidity out\" of the market, reserving it instead for margin deposit to hedge risky behavior? Please give US your thoughts as regulators. Saying we need more time to review secretly and not give you our professional feedback makes me question your function.
1,2,3.
Enforce. Regulate (via disclosure or prosecution). Clarify the rules. That's your job. That's what your $2 BB budget is for. Please go do your job.
Finally, I appreciate the recent regime change will lead to cultural and paradigm shifts at your agency. I want you all to realize this will be a new age in investing in the coming years regardless of SEC leadership. The group of young investors coming down the pipeline are very interested in holding all regulators, legislators and others involved in the process ACCOUNTABLE for their action or observed lack thereof. Please take the concerns of the American public and retail investors seriously, not just as a function of your role as a finger quotes regulator/enforcer.
I wish everyone at the SEC a fruitful and successfully persecutive 2021 season. There are a lot of low hanging fruit out there, please go nail them to a tree for all of the US citizens and every day people who have repeatedly been fleeced. Fleeced by individuals and organizations with more money, more information, more connections and more resources. Let's go SEC. Muster call.