Anthony @ Equity Investigations, Dear Anthony, Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony,

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Jeffrey S. Mitchell who wrote (98415)	2/28/2007 2:20:04 PM
From: Joe Senesac	Read Replies (1) of 122087

Good answer Jeff, thanks for the thoughts! You triggered a couple of further thoughts in my mind about the issue. As to the "own versus possess" response, you are completely correct. I have never been not able to sell a security in any brokerage account I have had. However, is the other benefit of "ownership" also that I am entitled to receive all the rights that go along with the said ownership, whether I actually physically possess the item or not? In reading the various items on the net about the issue overall, there seem to be (again) theoretical issues over how a broker/dealer would be able to distribute a dividend of "$x/share" when the floated amount of shares could be much larger due to naked shorting than the actual. As a followup to the point above, has anyone who has ever requested paper certificates of shares been unable to receive those shares? That seems like it would be a real sticky issue if it occurred - and proof of the existence of the issue. The only thing that I disagree with in your post is the applicability of the money supply issue and the "multiplier effect" that occurs at a bank. The multiplier effect has its base in practice that the bank is only required to keep a certain amount of funds on hand, and the rest is able to be lent out in order to MULTIPLY the money supply. The money supply expansion that occurs is quite substantial because of the iterations that can occur with loans and deposits. The lack of applicability of this analogy to the short situation is the crux of the matter. While monetary expansion is desirable and built into the monetary system, expansion of the actual amount of securities available is VERY undesirable - the shares outstanding should be the shares outstanding, without question. Thanks for the good discussion, wish all message board discussions were like this! Joe

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next