9/25/2008
Make a mistake, $50,000 fine!
This is another explosive issue. I heard that the remisiers are extremely unhappy about this new ruling that they can be fined up to $50,000 if they make a mistake and sell shares which they did not have in the Buy In market. Many were just shaking their heads in despair. The value of the mistake could be less than a hundred bucks.
And for such a ruling to get through, it must have gone through many rounds of discussions among many supertalents. And it is passed.
Great piece of regulation.
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6 comments:
Feedback on this piece of great regulations.
Some said it is very rash. Some called it draconian. Some said it did not address the real problem but instead kills the small investors and remisiers while the real culprits who shorted the market got away scot free through script borrowing.
Some said it is unthinkable that such a regulation can be conceived and implemented. I call it another example of dictation culture.
This new regulation is supposedly introduced to safeguad the interest of the ordinary folks. I think you are wrong to think that it is rash or called it draconian. It is formulated by million $$ brains, so it cannot be wrong. Jus be thankful your interests have been protected.
It is draconian only if the fine is 1M and or caning. Anything less can only be symbolic. Afterall what is $50,000? Peanuts.
ok, i admit i am wrong. $50k is not draconian enough.
the objectives, to safeguard the ordinary folks, and to prevent shorting of the market to push the prices down further.
who are the one that are shorting the market? not the little traders but the big boys who can sell in big volumes and still can do so even after the regulations. they can borrow scrips to cover their short positions.
protecting the ordinary folks? if one ordinary folk key in to sell one lot of 20c stock wrongly, the penalty is $1000. if he did it in the buy in market, the penalty can be $50k. he will probably die of shock.
the regulations do not curb the big boys from shorting the market and thus defeat the whole purpose of its existence. and it is going to hit the small traders real hard, and those who made genuine mistakes, including the poor remisiers. this lot is now a miserable lot as many of them have income that is less than a clerk.
it is no longer a viable business to many. and the risk is so high. now the penalty for a genuine error is crippling.
The local market is artificial.
Even the property market doesn't make cow sense.
If not for the impending huge raise in cost of borrowing and clamp on global liquidity, we probably won't even see a lala land back to ground.
Local banks have always take customers for granted, and change the rules as and when they like, never mind if they hurt customer interests. Yet, when the world goes down, we are their basic source of 'support'.
The problem now is, who will trust them again?
when a molehill wants to be a mountain, is like a python trying to swallow an elephant.
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