cudeco(cdu) limited - latest blog offering, page-12

Hi maxw

I have a thought about the advocacy you are attempting.

Thinking about the latest installment of the blog, the mechanism by which stock borrowers cover off market and thereby prevent accurate price discovery is their 'Achilles heel'. If that aspect of their trading could be prevented it ensures they then take the appropriate risks in short selling a stock in the first place.

As part of your correspondence with the relevant bodies, I believe it is useful to advance concrete proposals for legislative changes.

To that end I suggest:-

--- Shares short sold in the open market [i.e. lit market] must, by law, be repurchased in that same environment. ---

In this way price manipulation can be thwarted.

Such a law would in no way hinder the many other legitimate purposes that require the ability to lend or borrow stock.

The other arm of this practise is the use of HFT. That is such an obvious malpractice it defies comprehension that it continues, seemingly, unchallenged. [Common sense alone dictates that placing the computers equidistant from the ASX's own computer should be enough to alert anyone with average intelligence that 'something is up']

That however, I feel, will be a separate battle.