My personal theory is that disallowing short selling makes finding a bottom that much longer and tumultuous. Why? Because shorts need to buy to close out their positions. If you ban shorting, you have taken a large pool of buyers out of the market. You know that the only buys are those people dipping toes into the water. If you have shorting, you don't know if those are people dipping toes, closing out shorts, or someone getting ready to take a large position. It puts the healthy uncertainty back into the market, but this time in the mentality of making short sellers fearful. Fearful of a squeeze. That's what I've seen over my market experience (20 years trading, 15 years trading my own portfolio).