“Hedge Fund Short Sellers Deliberately Engineered The Economic Collapse” says Wall Street Insider Zubi Diamond 2010-02-14 15:11:38 - Zubi Diamond reveals how hedge fund short sellers lobbied the SEC to remove safeguard regulations in place since 1938 to prevent the stock market from crashing and then engineered the economic downfall. LOS ANGELES, CA – “Hedge Fund short sellers, George Soros and members of the Managed Funds Association deliberately engineered the economic collapse and the stock market crash for political gain and profit. They looted America in excess of $11 trillion dollars in the biggest financial scam and fraud in human history in order to get Barack Obama elected,” says author and Wall Street insider Zubi Diamond. Diamond, a rags to riches investment entrepreneur is author of Wizards of Wall Street: & Washington Lap Dogs. Diamond reveals how hedge fund short sellers lobbied the SEC to remove safeguard regulations in place since 1938 to prevent the stock market from crashing and then engineered the economic downfall. Story link: http://www.pr-inside.com/print1722113.htm And in case you were interested in his credentials: http://www.zubidiamond.com/bio.htm
That’s not much of a bio.
No offense, but he sounds like a nut job.
So, it WAS all the short sellers. Glad to hear we have no economic problems whatsoever.
Hmmm… I am pretty sure it was Bush appointee Chris Cox who removed the uptick rule and allowed naked skort selling to flourish.
If there are no short sellers and the market crashes, everyone in the market loses money. Money basically just evaporates as asset prices fall. If there are short sellers, some people lose money, other people gain money. There is a distributional effect, but there is actually more money in the economy and available for reinvestment (at least for a similar change in price). The real question is whether the net effect of having short sellers in the market or not will increase the total decline. It is true that the presence of short sellers may drive the price down during a panic, but it will also help keep the tops from being quite as bubbly a the top. So it’s hard to tell whether the crashes are worse with short sellers, because the crashes would presumably start from a higher top if they weren’t there to begin with. My sense (though I can’t prove it) is that allowing short sellers does improve the market’s use of information and ultimately does improve the risk-reward relationship. I don’t think the uptick rule is a bad idea though, since it may help constrain emotions on the downside (appropriate since shorting is inherently riskier than going long)
^Way to kill the thread.