> There is nothing illegal in the activities that I've seen: just people/institutions trading and holding stocks in an open market.

Not to contradict you, but just a reminder that short selling is based on something significantly different than "trading and holding stocks". The ability to promise to buy/sell stocks in the future at a given price has become so accepted as an ordinary feature of stock trading that we generally cease to notice how revolutionary of a concept it actually is. It's hard to see any rationale for prohibiting such arrangements - they are entirely consensual, and appear to have no additional impact on things that instantaneous buy/sell orders wouldn't also have.

But this is an illusion. The ability to go short/long on a stock is completely different from the ability to buy/sell it, despite it being based on all the same mechanisms. It's a truly radical concept that has slipped under our radar because it could be described without any new concepts or terms.

For the record, shorting stocks has been around for as long as capital markets have been around (1609):

* https://en.wikipedia.org/wiki/Short_(finance)#History

Bond markets started early than that:

* https://en.wikipedia.org/wiki/Stock_market#History

The judgement of the value of this I will leave to others to decide.

Sorry, I did not mean to imply anything about temporality (i.e. that short selling was "new" in terms of starting significantly after stock trading).

My point was almost consonant with yours - it's almost as old as stock trading, but nobody realized how fundamentally different the concept is. They didn't realize it in 1609, and they certainly don't recognize it now.

Most naive conceptions of how stock markets work would never allow for these sorts of contracts. The fact that they've (nearly) always been a part of actual stock markets just points to the same sort of gaps between the actual operation of the financial services industry and how most people think things ought to be that the current GME gyrations are (according to some) also pointing at.

Short selling is not revolutionary at all. Options and short selling are perfectly normal market instruments that have far ranging utility, including both hedging securities and insurance on tangible goods (e.g. a pork farmer buying puts on pork to ensure he can sell his product at a specific price).

Neither is it "radical" in any type of market. It just means selling something you don't actually have yet (something you're "short"). Think of a middleman who sources classic cars. He contractually agrees to sell a 1991 Ferrari for $60k. He doesn't yet own the vehicle, but knows he can source them for $50k. Unfortunately for him, a recently popular meme has gassed the price of Ferraris, and he now has to pay $70k for the car. He's still obligated to sell at $60k, so he begrudgingly takes delivery and loses $10k, having "sold short" the car. Is he revolutionary or radical?

Let me put it like this. The Romans would never have allowed this. Arab marketplaces? I'm not sure.

Forward sale contracts (selling crops which didn't yet exist for example) were commonplace in the Roman empire and wholly valid under Roman law.

Forward contracts and futures contracts have a number of important differences. Most notably, futures contracts involve assets that already exist, but will be traded in the future. Forward contracts involve assets that do not (typically) exist at the time of the contract, and will not be traded if they do not exist at the contract's specified date.

They also serve quite different purposes for a society/economy.

Whilst there are difference, I'm not sure it's really true that the underlying always exists for futures. The main difference between the two is that futures are standardised contracts traded on an exchange and typically subject to daily margining/price settlement which has some impact on the behaviour of their price over time.

Futures are useful to a broader group of people precisely because they don't need to involve physical settlement. Many people use commodity futures to hedge exposures to the price of assets which are not the underlying in the future but where there is a relatively predictable relationship between the two prices. Others use them to speculate on prices despite having no ability to deliver or take delivery of the underlying. Some contracts are even purely cash-settled.

(Edit: made clear that it was the point that futures always involve an underlying which already exists I disagreed with.)

The Roman empire fell so why should we care what they thought about securities trading?

> There is nothing illegal in the activities that I've seen: just people/institutions trading and holding stocks in an open market.

This is a bit of an oversimplification. Market manipulation for instance is forbidden my most regulators, and defined by the SEC as "transactions which create an artificial price or maintain an artificial price for a tradable security".

It would not seem irrational that people willingly gathering on internet to buy GME with the explicit objective of crashing hedge funds are considered market manipulators.