InterDigital Inc (IDCC)

[Danny Detail]

Thanksformusic .. When I was on WS there was very little, if any, naked shorting. Fails to deliver did not go unresolved. Was there a higher set of ethics then? I don't think so at all. What has changed dramatically is a shift from predominantly buy and hold investing to one driven and dominated by trading strategies and derivatives.

Every single aspect of trading has become orders of magnitude simpler, less costly, less labor intensive, closer to real time, less risky and MORE PROFITABLE. Show WS a way to make more money and all the players will flock to it like dots on dice. What comes next is an explosion of creative ways to milk the new cash cow. When the creativity hits diminishing returns some .. not all .. turn to illegal abuses to squeeze out as much as possible and typically these are the most profitable ways which is why they are illegal and a threat to investors and to the most important and efficient source of capital for publicly traded securities.

I certainly wouldn't completely rule out complicity by the SEC in allowing naked shorting to flourish but I really don't think that is the root cause. The perpetrators have spent billions of dollars on technology over the last decade in order to maximize their profits from legal and illegal trading strategies. They have left government regulatory agencies in their dust in terms of being able to monitor and rectify abuses. The kind of enormous funding necessary to close the gap will not be forthcoming in the near future IMO given that those holding the purse strings believe they have far more pressing uses for tax revenues.

Regards,
Danny