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new short sale rules next week?
- Thread starter Copernicus
- Start date
This is dumb as hell... you can't short a stock when it falls by more than 10 perecent, why? Sure you can buy it when it climbs more than 10 percent though...
Quote from Insurinator:
This is dumb as hell... you can't short a stock when it falls by more than 10 perecent, why? Sure you can buy it when it climbs more than 10 percent though...
I was going to same the same thing.
Its just like the overall market, when things are good and housing prices are running up 100% every 4 years and stocks are going into the next bubble they dont do a damn thing about it, they let it be and let everything continue to advance. No one says anything, stocks run up for years hundreds and even thousands of percent without any kind of intervention, for instance the dot com bubble, they let this thing go for years, IPOS were jumping hundreds of percent in only hours, housing bubble, credit bubble, loans to anyone and everyone during the housing bubble.................
But once things start to go in the opposite direction they take everything and anything to keep it from collapsing. greenspan and his historical low interest rates right after the dot com bust, bubble ben bernanke and his 0% interest rates and simple easy money policies right after the credit bubble, TRILLIONS IN STIMULUS, free monopoly money to bailout those who led the problem, what about all those housing programs to keep people in their houses and free $8000 handouts to anyone who bought a house to keep prices more inflated than they should actually be. What about free handouts for auto purchases. Commodity bubbles like oil going to $150 a barrel, they didn't put any regulations on that when everyone was paying close to $5.00 a gallon, they let it be.
Seems the economy and markets never get the real feel of the free market on the downside, intervention takes it place and keeps everything at ease. On the upside, well why would anyone want to fuck with that, when everyone is prospering its all fun and games.
While the shorting of stocks (naked shorting) has been problematic, I disagree wtth the message such a policy sends.
"Stocks can only go up."
After all, when the market goes down, it's not a "down market" but rather a "correction." That implies something's wrong....the market's not going up!!
"Stocks can only go up."
After all, when the market goes down, it's not a "down market" but rather a "correction." That implies something's wrong....the market's not going up!!
I'm not going to agree or disagree but I do believe you guys are failing to realize that earth doesn't revolve around people who day trade stocks all day long. It might be fine and dandy to short a stock from 10 to 2 all day long to you and every hedge fund on earth, but these are corporations and actual assets, and in turn companies, revenues, value, peoples jobs, lives. When markets go up, generally speaking things are better than when they go down. Things are not generally good when they are bad and the markets are falling through the floor, save for a few bears who are lucky on the ride. Of course the government and 99% of the human population would like the market higher, that would mean that companies are doing better, making more money, the world economy is functioning better, people are earning more, more jobs are available and everything is roses. So I don't know why you get angry over something that affects a very small percentage of people out there anyway. Oh no, sorry that you wont be able to add to your insignificant short position that you've probably entered at the wrong price anyway. Woopty doo. Cry about it, or better still complain about it all day long on ET.
The only problem with shorting is NAKED shorting - nothing else. They should make it MANDATORY to borrow the stock first before shorting it, and problem solved. but no, they don't want touch on the real problem. I can tell you my friends, I totally supported Obama and look, what a deception this government has been for me; it did not get anything important passed in congress, and it doesn't even police the markets even with mountains of evidence of wrongdoing. Why nobody investigated the trader(s) who bought options on bear sterns right before the crash? There's mountains of paper trail to find out who naked short selled the banks and profited from it. This government is a shame, seriously. Read story here http://www.rollingstone.com/politics/story/30481512/wall_streets_naked_swindle
Quote from SCI new york:
I'm not going to agree or disagree but I do believe you guys are failing to realize that earth doesn't revolve around people who day trade stocks all day long. It might be fine and dandy to short a stock from 10 to 2 all day long to you and every hedge fund on earth, but these are corporations and actual assets, and in turn companies, revenues, value, peoples jobs, lives. When markets go up, generally speaking things are better than when they go down. Things are not generally good when they are bad and the markets are falling through the floor, save for a few bears who are lucky on the ride. Of course the government and 99% of the human population would like the market higher, that would mean that companies are doing better, making more money, the world economy is functioning better, people are earning more, more jobs are available and everything is roses. So I don't know why you get angry over something that affects a very small percentage of people out there anyway. Oh no, sorry that you wont be able to add to your insignificant short position that you've probably entered at the wrong price anyway. Woopty doo. Cry about it, or better still complain about it all day long on ET.
SCI, a lot of people think like you, but, with all due respect, what you fail to see is that short selling (NOT naked) is a very good thing, it regulates the market and avoid bubbles getting even bigger than what they are now. Eliminate short selling and you will have a market very prone to a bubble that, when burst, would create a down trend that would last years. Short selling (not naked) adds checks and balances to the market.
Quote from jjj1000:
it regulates the market and avoid bubbles getting even bigger than what they are now. Eliminate short selling and you will have a market very prone to a bubble that, when burst, would create a down trend that would last years. Short selling (not naked) adds checks and balances to the market.
I don't know if there is any evidence to support that argument though; Nikkei at 40,000 and Nasdaq in 2000 were 2 markets in which shorting was allowed, and 2 markets that will probably never recover...I have no problem with shorting, but the "avoids bubbles" argument isn't that strong.
Quote from jjj1000:
SCI, a lot of people think like you, but, with all due respect, what you fail to see is that short selling (NOT naked) is a very good thing, it regulates the market and avoid bubbles getting even bigger than what they are now. Eliminate short selling and you will have a market very prone to a bubble that, when burst, would create a down trend that would last years. Short selling (not naked) adds checks and balances to the market.
totally correct and this is what the main public fails to see... they categorize short selling and NAKED short selling as the same. The naked one i agree it should be looked into and prohibited !
short sellers not only avoids bubbles to be bigger, but also it avoids market collapses of being even bigger ! short sellers will be future buyers on closing their popsitions, so it softens the decline... without short sellers to buy back the shares to close the positions and without buying interest prices would collapse greater...
i guess people have short memory... what happened last time when shorting financials waas banned? S&P was trading at 1100-1200 ... 3 weeks later it was around 800 points...