Benchmark real value? Are you kidding? Short selling, by definition, is a speculative engagement. If we didn't have short selling... I think THEN we would see the real value of common stocks.

Short sales makes the jettisoning of a few shares on the market seem like dumping a few hundred shares - value wise.

Now if you said that short selling makes market play more fun... or that it makes you feel more engaged to complement your long-term portfolio with Vegas-style tactics that (if successful) give you an excuse to were a cape and make people refer to you as "Nostradamus." Then, yes... I agree.

Gary,

Bravo.

"The SEC's indicated desire to quash the spreading of false negative information by, and for the benefit of, manipulative short sellers, is nothing even remotely akin to a First Amendment issue. The First Amendment does not give protection to slanderers, liars, and sabotage artists. I'd also like to make clear my opinion that honest short selling is a positive, healthy, and necessary practice."

Your statement is true. It is precisely what I tried to make clear three years ago. Be prepared for photos of you to appear with UFO's coming out of your head, for stating this truth.

Patrick Byrne

Short Selling is not only a trading technique that has outlived its initial purpose,but it is immoral because no stock buyer should have their stock loaned to a shorter who sells the stock to drive down the market value of that stock. And add to that, naked short selling, and you have criminal activity. The SEC is supposed to oversee such activity but for whatever reason hasn't. The reasoning that shorting is a positive because the shorter has to evidentually buy in the stock is almost laughable if not such a serious matter. Any corporation that has experienced some hard times
or been on the Brink of Bankruptcy, can tell you the serious damage done to them and its stockholders by 'Short Raids". The next time you sign an hypotication agreement with a Broker,tell him to cross out the loaning you stock to a short- seller. A Brokerage firm should only be concerned with its right to sell the mortgaged stock to meet a Maintenance calls. Any other rights will be for the purpose of generating commissions.

I have a margin account which allows me to short stocks, which I occasionally do. I would agree that naked shorts, as opposed to covered shorts, should be regulated or curtailed, but I also believe that short positions help stabilize the market. Being able to bet against irrational exuberance is healthy. If you think the stock market would be better off with only long positions, look at the shanghai index (shorting Chinese stocks is forbidden) and find a good financial advisor to manage your investments.

I think that if anyone took the time to read the L.A. Times report you would agree that all moves of last week are questionable. The Cox move being in the front. It is highly selective and only covers specific stocks. which to no surprise, are in the finance area.
Cox's own statement on the matter raises eyebrows as he stated that shorts are necessary to sound market activity. Granted, he means the legal kind and all of the related action is supposed to alleviate naked shorts and the malicious rumor mongers. The real reason behind all that transpired between Fri. 11th and Mon. 14th was that the government has a vested interest in keeping the stock markets stable. They managed a few lies between Fri and Mon themselves. I applaud them for the effort, but I think this is going to prove too little, too late.
Take the time to read Sec. Paulson's latest statements and you will agree that his outlook is not exactly rosy.
The Washington actions also have from my perspective, a potential fly-in -the-ointment scenario, and if there it will be discovered by the investigative press with the outcome worse than watergate.

Are you aware that DeepCapture is an astroturf site run by the CEO of Overstock.com, a cash-burning company, that serves to stalk and intimidate anyone who criticizes the company?

"The First Amendment does not give protection to slanderers, liars, and sabotage artists."

Don't you think the markets are a little smart for that? If a company can be destroyed by middle school rumor mongering, wasn't the company incredibly weak in the first place? The reason that companies like Lehman and Bear Stearns are vulnerable to rumors is that they were not level with investors in the first place, and investors simply do not trust them. If someone started spreading rumors about the status of a company like Warren Buffett's Berkshire Hathaway -- a paragon of transparency and integrity, no one would believe it. Why? Because it's an honest and ethical company. Companies like Bear Stearns are victims of their own mismanagement and lack of honesty, not savvy people who bet against them.

>The good news here is that we might finally be able to stop pulling our hair out due to deep and unexplained drops in the share values of companies that are well managed and fundamentally sound.<

If they're fundamentally sound, then what's the problem? Manipulative trading would create a tremendous bargain opportunity! People should be celebrating the opportunity to buy more! Have you been taking advantage of this great opportunity to load up on well managed and fundamentally sound companies (with billions of dollars in losses in the past few months, buy hey)?

These brokers cleaned up on playing the market and now they want special treatment now that they've lost Billions on their bad investments. If you want to stop short selling, TURN A PROFIT! Don't cry if you lose five Billion in a quarter and your stock goes down. I'd like an investigation as to how these brokerages houses landed special treatment in the market when no other businesses have. If they lose twenty Billion a year they should be worth less!

Don't forget of the pure theft of the money when "they can't find the shares". This is how stupid the boyscout's honor system is set up. Get rid of naked shorting across the board. If not prepare for some inevitable violence and bloodshead. People don't like to get robbed, remember the American Revolution?