Re:Regulators systematically ignore evidence that deregulati...
by yummyfajitas on Tuesday December 06, 2011 @10:33AM
(#3319594)
This article is full of crap. It claims that Gramm-Leach-Bliley created "too big to fail", but we had too big to fail long before Gramm-Leach-Bliley. For that matter, I don't think Gramm-Leach-Bliley would have prevented GM from being "too big to fail".
The uptick rule is also a red herring. We had a controlled experiment in 2004 - the SEC eliminated the uptick rule for about 1/3 of securities. No disaster occurred for those 1/3 of securities that didn't also occur for the remaining 2/3.
There is no compelling argument whatsoever why shorting stocks should be harder than going long. The main people who want to prevent short selling are executives of failing companies - short selling allows speculators to inform the market about the companies impending failure, which tends to be bad for the CEO.
The uptick rule is also a red herring. We had a controlled experiment in 2004 - the SEC eliminated the uptick rule for about 1/3 of securities. No disaster occurred for those 1/3 of securities that didn't also occur for the remaining 2/3.
There is no compelling argument whatsoever why shorting stocks should be harder than going long. The main people who want to prevent short selling are executives of failing companies - short selling allows speculators to inform the market about the companies impending failure, which tends to be bad for the CEO.