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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Jeffrey S. Mitchell who wrote (98415)	2/28/2007 1:48:53 PM
From: Bill from Wisconsin	Respond to of 122087

Good analogy Jeff Where are the people calling in their certs (dollar bills) from their local banks. LOL FTD's all around! Scandalous! ""OK, maybe if just you ask for the money, you'll get it. But say every single person with an account at your bank demanded their money in cash. Do you know what percent the average bank keeps in cash on hand? It's a mere 10% (I looked it up: in.answers.yahoo.com ). In other words, not having 10,000 real dollars at your bank does not indicate you don't really own $10,000.""

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