if the nyse cares even a little bit about staying in business, they better flex some muscle and make a case for the validity of short selling.

by josh on September 24, 2008 3:26 PM

Earth to NYSE. IBM is not a financial.

by buddy on September 24, 2008 4:30 PM

Earth to Buddy. Not our call. The criteria in the SEC order are explicit and give the exchanges no discretion.

by Ray Pellecchia on September 24, 2008 4:57 PM

This is getting ugly real fast. We are witnessing the collapse of our "Free market system" They started with naked shorts and now its expanding to eventually include all forms of shorting. Shorting stocks is one of the hardest strategies for a trader to make money since theoretically your loss has no limit. I cant believe whats happening here as now we are all being punished for the criminal actions of a few. For that matter why did the SEC allow airline stocks to be shorted when they were getting pummeled? Perhaps they didnt have their ex-ceo as SEC OF TRES? or they didnt have the right connections? Who knows but why wouldnt every public company now want to be included on this no short list? This is totally wrong on so many levels. thanks ray.

by tony dey on September 24, 2008 6:00 PM

Hi Ray,
I know you're busy, but I was hoping you could send me over the press release, or lead me to a link that discusses the 1366 seats that were converted in shares in 2006. Thank you, and I hope you're hanging in there.

PS - Cleveland gets to open the new Yankees stadium -- I am thrilled, and wish I could be there!

by Barry K on September 25, 2008 9:15 AM

Tony -- From what Duncan said, sounds like a lot of people are working on a better long-term solution that can be applied across the board, instead of different rules for different sets of stocks. I join you in hoping it comes soon.

Barry -- This is the release that seems to best fit the bill:
http://www.nyse.com/press/1135856420824.html

Yes, hanging in, thanks; hope you are too.

That's great about the Indians; I don't know that. May 2009 be kinder to both our clubs.

Thanks for writing, guys.

by Ray Pellecchia on September 25, 2008 9:52 AM

Hi Ray,

Crazy times we are in here, aren't they? I will spare you any comments/complaints on the current market conditions and regulations...

I am curious how the Matchpoint rollout is going. I have a couple questions on that -- will the prints be disseminated when they happen over the consolidated tape? Also, what kind of volume has been executing on those crosses so far? Do you have any stats you can share?

Thanks,
Ben

by Ben Berspanke on September 25, 2008 1:00 PM

On the MatchPoint stuff, all trades executed in MatchPoint are disseminated to the consolidated tape with an NYSE print and with an "X" modifier so you can distinguish between MatchPoint trades and DisplayBook trades.

MatchPoint began operating its intraday matches a few weeks ago (such timing!) and member firms are now beginning to send in more and more orders (avg order size is around 25K shares) as they are getting used to the point-in-time operation of MatchPoint. Though we have not had a match yet, we are actually quite pleased with the member and investor response to MatchPoint.

For the NYSE and its members, the introduction of Matchpoint is kinda historic as it is now for the first time operating both a non-displayed,benchmark call market(point-in-time) and a displayed, continuous, price discovery market trading models AND MatchPoint can trade all NMS securities not just NYSE-listed!

And with NYSE's new market model and the New York Block Exchange around the corner, there is a lot going on at the NYSE....

by Jim Ross on September 25, 2008 5:10 PM

I know that the ban on shortselling was not the nyse's decision, but does anyone know how this thing is spreading to stocks like auto nation and cvs. This is getting insane. Is the nyse letting the sec know that this thing is getting out of control. Markets can not work when confidence is gone. And if a trader feels that the rules can be changed without warning in the middle of the game, then how can they possibly have confidence.

by josh on September 26, 2008 7:30 AM

Josh -- The SEC's order is quite explicit as to which companies qualify for the list, and it gives the exchanges no discretion. Excerpt from the order:

"The Order applies to the publicly traded securities of certain financial firms, which entities are identified in Appendix A to the Order (“Included Financial Firms”). We are amending the Order to modify the list of Included Financial Firms. As we stated in the Order, recent market conditions have raised concerns that short selling in the securities of a wide range of financial institutions may be causing sudden and excessive fluctuations of the prices of such securities in such a manner to threaten fair and orderly markets. Difficulties with the classification criteria led to the omission of financial institutions falling within these categories. In light of the familiarity of the exchanges listing financial institutions with the nature of their respective businesses, the Commission has determined to amend this Order to provide that the listing markets shall select the individual financial institutions with securities covered by the Order. The Commission expects each national securities exchange listing financial institutions to immediately publish a list, on its internet Web site, of individual listed companies with common equity that will be covered by the Order’s prohibition on short sales. The Commission expects these lists to cover banks, savings associations, broker-dealers, investment advisers, and insurance companies, whether domestic or foreign, and the owners of any of these entities.

"To the extent an issuer chooses not to be covered by the Order’s prohibition on short sales, we have authorized the applicable national securities exchange to exclude that issuer from its list of covered financial firms."

To your question, note in particular the criterion, "...and the owners of any of these entities."

Here's the link to that order:
http://www.sec.gov./rules/other/2008/34-58611.pdf

When companies request that they be added to the list, NYSE requires them to file with us an analysis of how they qualify, and we review that "self-attestation." If we verify that they are or own one of the listed financial entities, the company is added to the list.

I hope that at least clarifies the process. Thanks for writing, Josh.

by Ray Pellecchia on September 26, 2008 8:57 AM

Ray,

Why isn't Fifth Third Bancorp (FITB) on the list? Thanks!

by Nick on September 30, 2008 2:23 PM

Nick -- Sorry, I'm not playing spokesman for Nasdaq; I'll let them speak to their companies and their list. Maybe you could post that question to Nasdaq's blog, if they only had one. I invite someone from Nasdaq to post the answer here. Comment box is yours, Nasdaq!

by Ray Pellecchia on September 30, 2008 2:56 PM