Government Blaming Wrong Area

When the government came out and said no short selling, well that was a bit to much.

First people have the wrong reason for the market decline. It isn’t short sellers, it is bad management decisions by financial companies such as Bear Stearns and Lehman Brothers. Those companies and others ended up making large over sized bets that nothing could go wrong. Almost all of it is real estate related. And plenty has gone wrong.

Banning short selling may be one of the worst ideas ever, even if it is only in financial stocks banning. Forcing people to short stocks legally is another matter and I hope that part of the plan works. 

You will now get artificial up moves in stocks because people will believe these problems are over.

We haven’t seen the end to this crisis just because someone diverted the attention off of the financial problems to people who short stocks.