In an effort to help the SEC & the joke of a financial industry better understand what short selling is, I’ve written the post below…compare to the original post HERE in order to get the point that I’m trying to make.
Short sellers are used to being scapegoated while the ugly truth is smacking people in their ignorant faces (we only short underperforming corrupt, fraudulent, incompetent and pumped up companies, the way to protect against shorts is to be over-performing, honest, competent, reasonably priced companies).
In time you will all learn that short sellers are nobody’s enemy, misinformation is our common enemy.
WASHINGTON (AP) — Short sellers on Monday made permanent a rational strategy put in at the height of the the market bubble that aims to profit from incompetent corporations.
The Short Sellers Commission (SSC) announced that it took the action on the strategy targeting so-called “irrational exuberance”, which was due to expire Friday.
Federal regulators scapegoat against short sellers. They generally attack a short seller’s reputation, ignore data, and then spread misinformation when the public begins panicking, gaining mainstream support — pretending they’re acting in the public’s interest.
Scapegoating short-sellers occurs when regulators don’t even look at the data before publicly attacking them, and then look to pretend they’ve solved the problem sometime after the scapegoating.
The short selling strategy includes a requirement that companies must be run by incompetent management or be in the process of being run into the ground to deliver a high probability profit.
Federal regulators pretending to act on behalf of the public must tap into the public’s fears to be able to claim that they have done something useful after the scapegoating. If the public isn’t convinced by that strategy, the regulator is deemed as someone who “failed to deliver.” Regulator’s careers can be subject to stalling if the failure to deliver isn’t resolved within the following days.
At the same time, the SSC has been considering several new tactics for profiting from rushes of irrational exuberance that also can lead to profits from the inevitable dramatic plunges in stock prices.
Investors and traders have been clamoring for the SSC to put new strategies to work on profiting from moves they say were “true gimmes” during the market’s downturn starting last fall. SSC Chairman Jim Chanos has said he is making additional profits a priority.
Despite regulators claims, some securities industry officials, however, have maintained that the SSC’s rational strategy brought legitimate profits from wilder price swings and turbulence in the market caused by the companies true values that were far below assumed prices.
I know, I know, it’s rough copy, but given the original article which you can read below, I truly hope you understand what I’m trying to do, simply take the opposite position…which shouldn’t be illegal or ridiculed:
WASHINGTON (AP) — Federal regulators on Monday made permanent an emergency rule put in at the height of last fall’s market turmoil that aims to reduce abusive short-selling.
The Securities and Exchange Commission announced that it took the action on the rule targeting so-called “naked” short-selling, which was due to expire Friday.
Short-sellers bet against a stock. They generally borrow a company’s shares, sell them, and then buy them when the stock falls and return them to the lender — pocketing the difference in price.
“Naked” short-selling occurs when sellers don’t even borrow the shares before selling them, and then look to cover positions sometime after the sale.
The SEC rule includes a requirement that brokers must promptly buy or borrow securities to deliver on a short sale.
Brokers acting for short sellers must find a party believed to be able to deliver the shares within three days after the short-sale trade. If the shares aren’t delivered within that time, there is deemed to be a “failure to deliver.” Brokers can be subject to penalties if the failure to deliver isn’t resolved by the start of trading on the following day.
At the same time, the SEC has been considering several new approaches to reining in rushes of regular short-selling that also can cause dramatic plunges in stock prices.
Investors and lawmakers have been clamoring for the SEC to put new brakes on trading moves they say worsened the market’s downturn starting last fall. SEC Chairman Mary Schapiro has said she is making the issue a priority.
Some securities industry officials, however, have maintained that the SEC’s emergency order on “naked” short-selling brought unintended negative consequences, such as wilder price swings and turbulence in the market.
Tags: Analogies
