Date:    12/21/1999  1:19 PM

Subject: Comments on File No. S7-24-99,  Release number 34-42037 

     
     
To Whom It may Concern:
     
In regards to the proposed rules on short selling and naked shorting, the bottom
line is it should be abolished or extreme limits set. 
     
The underlying basis for my opinion is it has been my experience for nearly 3 
years on line that certain people, professional and especially offshore have the
ability to short whenever they feel like it. Tick test or no tick test, due 
diligence or not, fundamentals or not makes no difference. The action of the 
stock and the ability to manipulate the downward movement of a stock is all that
matters. 
     
The big players can already buy at the bid and sell at the ask. Also, with the 
enormous spreads the small investor is already at a disadvantage. The Market 
Makers can gap the spread at anytime thus killing a company's security from even
trading. In order to get an inventory they can gap to unbelievable spreads and 
then short it down for no reason other than to try and get stock to cover what 
they sold naked previously. This hurts the company, the small diligent investor 
and the term investing is diminishing. As investing for long term slowly is 
destroyed it becomes the catalyst for even more day trading scenarios because 
investing is at the mercy of shorting. 
     
We, the small USA investor are also at the mercy of all this, along with the 
companies that go public to enhance and grow their business. The SEC has 
established rules, which we as American small investors have to obey and comply 
with whereas other countries and big money even here in the states can do as 
they wish. 
     
It is unfair for small investors in America to be at the mercy of rules and 
regulation that were founded to protect the small investor when other countries 
and big money can manipulate the market with these very same rules. As with any 
rule there are loop holes and scenarios, which can be used to continually steal 
the hard earned money away from the small investor especially if they are an 
American and even more if they are trying to invest instead of day trading. 
     
The SEC has continually made it know to the public to do your own DD and invest 
once you have proven to yourself the information is true. More and more people 
are doing that thus paying outrageous phone bills and personal expenses to try 
to get to the facts, truth and potential. None of this matters really anymore 
because shorting is completely out of control. Due diligence though it helps the
small investor understand why they are buying the security it takes only a group
of shorters to crush both the diligent investor not to mention cripple the 
start-up company.
     
It is very possible and more that likely, that some people or groups short and 
then post or though and associate post on line simple distortions by Purposely 
Omitting Syntax or Purposely Adding Syntax to create a bear raid. This is the 
opposite side of the coin to a pump and dump, which the SEC will go after in a 
heartbeat. Short and Distort is far more vicious and manipulative than any 
tactic in the market because the pump has to be very well planned in order to 
get people to buy. On the other hand or side of the coin a distorter merely has 
to twist a mere word in a sentence or fact to implement a bear raid with no due 
diligence what so ever. 
     
     
It is common knowledge getting buyers into a market is extremely difficult but 
getting people to sell is the easiest thing in the world to do. If you post a 
lie in a positive sense thus causing people to buy then it is in violation of 
rule 10b5 but if you post a lie in a negative sense is that also not a 
violation?
     
Shorting has raped many a good company and thus killed public view to a 
negative. Destroying the goodwill image of the company with shorting and large 
gaps is not what the rules for shorting was intended to do. Companies have to 
pay a lot of money to be in compliance only to be nailed by something as simple 
as short selling. This hurts the company and the investors regardless of the 
opportunities or potential the company may have. The playing field for the 
average US citizen and the companies that are victimized by shorting is not 
anywhere close to being level or just.
     
Also shorting can take away the very life of a company because a company goes 
public to use their stock as a financial vessel. Shorting is a way to take any 
chance what so ever away from a company to get the financial support they need. 
By killing the stock price the shorter has the advantage again because they have
a better chance of destroying the company. 
     
I also have one suggestion though and than is shorters should have to disclose 
the same as compensation in accordance with rule 17b. My underlying basis is 
because they have shorted something they do not own or have borrowed thus is 
this not basically the same thing.  They capitalize on the power of borrowing or
something that does not exist.
     
I appreciate the fact and the efforts you are bringing forth to get companies to
meet compliance and addressing the short selling/naked shorting scenario. I 
further appreciate you taking the time to allow me to voice my opinion for your 
review and consideration. The bottom line is if investing for the future is 
going to ever be popular again, shorting is going to have to be addressed with 
extreme prejudice.
     
Respectfully.
     
Gary G. Swancey a.k.a. Ga Bard 
     
USA Citizen
     
 PS:  This was such a good letter, I could not improve upon it.  Please, give us 
 little guys and gals a chance at the American Dream.
     
Thank you in Advance.
     
Gayle A. Janoff
     
A taxpayer with dreams..........