Isakson Continues Push to Turn Around Economy

Introduces Legislation to Force SEC to Reinstate the Uptick Rule

Mar 17, 2009

WASHINGTON - U.S. Senator and Senate candidate Johnny Isakson, R-Ga., today announced that he has introduced legislation to require the Securities and Exchange Commission to reinstate the “uptick rule” in order to stabilize the financial markets and protect American consumers from traders forcing down the price of a stock.

“This legislation is right for America, it is right for America’s investors, and it is right for our stock market as it still languishes today somewhere down near what we hope is the bottom.

“I have been pushing for a change to this rule since last fall when I contacted then-chairman of the Securities and Exchange Commission, Chris Cox, to urge him to reinstate the uptick rule. The market deterioration was impacted by short sellers rushing to the market, shorting financial stocks and accelerating the decline of those values. We must stop rewarding those who would feed off of the bottom and instead reinstate good discipline that ensures good practices and allows the market to restore itself back to a good equilibrium.

“The legislation that I am co-sponsoring, directs the SEC to write regulations within 60 days to end abusive short selling. These regulations must reinstate the substance of the uptick rule that prohibited short sales that are not made on an increase in the price of the stock as well as require exchanges and other trading venues to execute the trades of long sellers ahead of short sellers, all other things being equal. With the concurrence of the Secretary of the Treasury and the Chairman of the Board of Governors of the Federal Reserve System, the bill also directs the SEC to prohibit short sales of the securities of any financial institution unless that trade is affected at a price (in minimum lots specified by the Commission) at least 5 cents higher than the immediately preceding transaction in such securities.