SEC To Release Proposals For Comment on Short Sales

UPDATE: As noted below, SEC's press release was issued this afternoon.
MarketWatch is reporting that at its open commission meeting earlier today, the SEC commissioners unamimously approved the release of five proposed rules for public comment relating to short sales. According to the MarketWatch article by Ronald D. Orol, SEC OK's Effort to Limit Short Sales, one of the proposals would simply reinstate the uptick rule, the other proposals are variations on that theme. He adds there will be a 60 day comment period.

As background, Orol notes, "Short-selling is controversial. Many companies say short sellers spread false rumors to drive prices lower, but short sellers say they provide the necessary counterweight to the boosterism of market bulls." He adds, "Some critics say the elimination of the uptick rule [in 2007] was a major factor in the bear market that has seen major stock averages fall 48% since peaking in October 2007, just three months after the rule was abolished. In October 2008, the SEC barred short sales of many financial corporations."

UPDATE 4pm: SEC press release has been issued. You can also read the statements made at today's open commission meeting by Chairman Mary L. Schapiro, Commissioner Luis A. Aguilar, and Commissioner Troy A. Paredes. Update 4/10: Read the statement of Commissioner Kathleen L. Casey . Read more in The SEC's 5 Uptick Rules in a post by that name by John Carney on BusinessInsider.com. MORE: SEC posted its 273-page rule proposal on April 10: [Proposed] Amendments to Regulation SHO.

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