Apr. 20, 2022
This rule is antithetical to the entire concept of free and fair markets. The entirety of futures pricing incorporates risks of clearing and defaults, and changing the default rules for short sellers years into aggressive and ill advised shorting activity is a blatant attempt by the watchdogs of the market to pick winners and losers by changing the rules of the game after the fact. If anything, such a policy will only serve to further erode the investors' confidence in the legitimacy of the market, true price discovery, and fair market activity. To insulate only select parties from the consequences of malfeasance or poor judgement is a theft of opportunity from those who at the same time take a counter position of honesty and thrift. By allowing these allegedly equitable swaps to take the place of true settlement and closure, this policy will only encourage future abuse of the already fragile system. Furthermore, it cannot be said that the substitution of one security for another as a means of settlement is of equitable value when true price discovery is being hampered. Even if the securities have the exact same value at the moment, each security represents a distinctly different opportunity. The SEC’s job is not to protect the market makers and institutional investors. It is to set fair and reliable rules for the investors in the market to make known and calculable risk. This is the opposite of that, by softening, after the fact, the effects of poor judgment, and blatant efforts to dare the rule makers, you, into making concessions to those that have failed so spectacularly, that they have created market risk. The moral hazard of further encouraging this behavior will end free and fair markets. Our ancestors have died for the freedoms we have, by the stroke of the pen, you’re negating their sacrifice to play king-maker in a command and control economy not unlike central planning that served as our counter point to a 50 year Cold War. This is shameful, and should never be implemented. Zachary Dablow 494 State Street, Suite 300D Salem, OR 97301 Ph: (503) 485 - 4168 Fax: (971) 600 – 9138 Cell: (503) 409 - 3759 www.dablowlaw.com CONFIDENTIALITY NOTICE - ATTORNEY CLIENT PRIVILEGE: The information contained in this e-mail communication contains confidential information which is legally privileged. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information except its direct delivery to the intended recipient named above is strictly prohibited. If you have received this email in error, please notify me immediately by telephone or by email reply to arrange for the return of this information to me.