This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Opinion: Uptick Rule Is No Cure All

The uptick rule, the credit default swap (CDS) market and short/leveraged ETFs have become lightning rod issues for market participants who see how poor regulation of, or a complete failure to regulate, the financial markets resulted in an untenable investment environment.

By now, legislators on Capitol Hill have latched onto these lightning rods in an attempt to seek a Congressional cure, so the writing is on the wall. In fact, Barclays (BCS), the biggest purveyor of ETFs, announced that the company is in talks to sell its iShares ETF unit. The company cited the need to raise capital, but perhaps Barclays really considered the possible regulation of ETFs as a signal of a topping out in the ETF market.

Simply reinstating the uptick rule, regulating CDS and eliminating short and leveraged ETFs will not be cure-alls to all that ails the markets. For generations, creative Wall Street traders have figured out ways to legally weave their way around regulations to obtain a stated goal -- namely, to make money. Count me as one of those creative individuals. As sure as the sun rises in the east and sets in the west, if we continue on the current legislative track, my guess is that the uptick rule will be reinstated with exceptive relief, CDS will be loosely regulated and ETFs will be subjected to more scrutiny but remain as neither fish nor fowl from a regulatory perspective. Whether that is the manner in which regulatory changes unfold is not certain. I will guarantee, however, that new regulations will be lacking in scope and impact. In other words, we will have more opportunities to create structures to get around a new set of half-baked rules. I might as well dust off my résumé and shop it around now.
1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
NYC $93.98 0.34%
BCS $10.05 0.00%
FXI $33.53 0.00%
IVV $207.46 0.00%
IWM $112.48 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs