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Microcap & Penny Stocks : Naked Shorting-Hedge Fund & Market Maker manipulation?
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To: creede who wrote (3536)7/16/2008 1:04:25 AM
From: Hawkmoon  Read Replies (3) of 5034
 
Y'know.. if all of those orders are going through without being reflected on the ticker, then we'll all have to reassess the definition of a public market..

Regulators REALLY need to step in quickly on this and ensure that maximum transparency is available for the general public and that ALL TRADES are reflected on the tape.

I think I mentioned here previously that all individual stock certificates should have a unique ID number that is recorded when stock is bought/sold. That way there is absolute accountability of all publicly traded stock tranactions.

Electronically those numbers could be "reassigned" to shares held electronically when purchased. Say I have 1,000 shares I purchase in 2 separate blocks. At the end of the T+3 all unique ID numbers are assigned sequentially to the my portion of outstanding stock (eg: 1 through 1000) and limits placed upon the amount of unreassigned stock available for the day and swing traders.

That should put a real crimp on naked shorting, as well as making sure that only margined stock (which would be assigned a certain block of those numbers) could be shortable.

Might require some more serious upgrades to broker/dealer computer networks, but I think it would be worth it. After all, doesn't every piece of currency have unique numbers?

Comments?

Hawk
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