ftfa: "Bear raids" have been considered a risk to markets since the Great Depression, and a financial regulation called the "uptick rule" was instituted in 1938 to prevent the tactic. The uptick rule was repealed in in July, 2007, and the alleged bear raid took place in November, 2007.

from wiki: "The SEC eliminated the uptick rule on July 6, 2007.[9] The SEC concluded from the study cited above: "The general consensus from these analyses and the roundtable was that the Commission should remove price test restrictions because they modestly reduce liquidity and do not appear necessary to prevent manipulation. In addition, the empirical evidence did not provide strong support for extending a price test to either small or thinly-traded securities not currently subject to a price test."[6] Commenting on the scrapping of the uptick rule, The Economist reported that "short-sellers argue [it] was largely symbolic, and it remains in place at only a few of the world's big stock exchanges."[10]

once again the SEC proves that it has everything under control...

thomps: ftfa: "Bear raids" have been considered a risk to markets since the Great Depression, and a financial regulation called the "uptick rule" was instituted in 1938 to prevent the tactic. The uptick rule was repealed in in July, 2007, and the alleged bear raid took place in November, 2007.

from wiki: "The SEC eliminated the uptick rule on July 6, 2007.[9] The SEC concluded from the study cited above: "The general consensus from these analyses and the roundtable was that the Commission should remove price test restrictions because they modestly reduce liquidity and do not appear necessary to prevent manipulation. In addition, the empirical evidence did not provide strong support for extending a price test to either small or thinly-traded securities not currently subject to a price test."[6] Commenting on the scrapping of the uptick rule, The Economist reported that "short-sellers argue [it] was largely symbolic, and it remains in place at only a few of the world's big stock exchanges."[10]

once again the SEC proves that it has everything under control... been completely captured by the industry it is charged with regulating

But, but overregulation!

In before "short selling is evil"

I wanna know how the extra buyers on the 1^st knew to buy on the 1^st so they could profit on the 7^th, the day after the rule is lifted.

downstairs: In before "short selling is evil"

did you read the article?

short selling + intentional manipulation.


exactly what all the people who generally just say "short selling is evil" without their justification were concerned about.


it's almost like the regulations created after the great depression exist for a reason, and that the slow process of destroying them over the last 30 years had plenty of immediate warnings of the negative effects after each individual one is stripped.


you might not pay attention to history, but some of us do.

Sh*ttyGroup? Why dey have such sh*tty financial fire-wall!

GAT_00: But, but overregulation!

There was a guy on the Kudlow Report on CNBC tonight saying exactly that - that the collapse in 2008 was because of too much regulation. That all those regulations created the appearance that nothing could ever go wrong, and therefore nobody was looking out for what actually happened. Sort of like we have too many laws about killing people, so the police can't ever stop anyone from killing anyone else. The logic had more twists than an M. C. Escher painting.

He went on to say that the regulators were those people that couldn't make it on wall street, and would never be able to understand the workings of the vastly superior intellects that work in the big investment banks.

The sheer stupidity disingenuous evil of the man was astounding.

Dinki: There was a guy on the Kudlow Report on CNBC tonight saying exactly that

I can't watch that cokehead anymore. My brain finally told me no.

NewportBarGuy: Dinki: There was a guy on the Kudlow Report on CNBC tonight saying exactly that

I can't watch that cokehead anymore. My brain finally told me no.

Yeah Kudlow wasn't there which is why I watched it. But they still managed to dial the free market capitalist derp up to 11. oh well.

Can we start hanging these bastiges yet?

downstairs: In before "short selling is evil"

Short selling without returning profits is illegal, I know that.

imontheinternet: Or... maybe a lot of investors realized all those junk assets were about to drag the system down, and frontran it.

Seriously, "bear raids" didn't cause the banks to pump subprime mortgages up 70 to 1.

no, removing the regulation that prevented them from doing that did.

the bear raid was just the step that started the avalanche.

CruJones: It's quite possible short selling was way up for a reason. To be fair, from a strictly financial perspective, it was the right call.

If I remember reports from the time correctly, shorts among pretty much every financial firm were increasing at the same time. Some more than others, but smart people could see what was going on and were looking to make a buck on it. Some people figured out how to simply bet against the credit defaults and others shorted the stocks outright.

That was about the time I bought a lot of ammunition and canned goods.

Mad_Radhu: By 2007, I think it was already too late for the pebbles to vote.

If you read The big Short, there were way too many CDOs that had bad mortgages in them for the system to not melt down. The only conspiracy was the banks collectively deciding that there was short term money to be made securitizing not just mortgages, and no one gave a damn about the long term consequences so long as it meant that they were going to see a fat bonus at the end of the year (or, on the flip side, creative financing allowed people to buy that McMansion they could not afford).

oh definitely, nice kosh quote btw.

i expected an economy collapse by 2008 the moment bush was declared president by fiat in 2000, i was sadly not disappointed in my expectations.

So 3 years after the fact, this freaking genius figures this out.
I think there were a lot of people who knew the day it was happening and a lot more the day after.
There has been evidence of market manipulation for years. It isn't freaking news to anyone that follows the market and pulls up the data. To sit there and say the SEC is too stupid to figure this out is just , well stupid. Just because a graph indicates that something is wrong, doesn't tell you who did it and with what intention. You have to prove it. And when someone can cover a spread like this they are usually someone large like a much The other scenario, is that maybe a number of these people involved weren't heavy hitters. They were small and knew that one of these banks was going to get decimated. The only thing they were waiting for was the start of the storm, just a little bit of a wave and a number of people jumped on it.

Yes, the short selling created instability. But what really made it fail was the underlying foundation was smoke and mirrors. The short selling broke the mirrors.

The regulation would not have prevented a fall, it would just have delayed a freefall.

If this guy really wants to be a freaking know it all genius, then he should sign up with the SEC and show us how smart he is.

Yes the regulations on short selling should be put back and regulations should be enforced. What happened was a push against all ethical and moral boundaries. Basically the story told us that there are a significant number of people who if not threatened with a significant penalty, they will pilfer money and say fark you to everyone else.

//Sorry, just tired of these assholes that say they are experts and call the rest of society stupid. Not //just the individuals, I mean every cable news outlet that calls itself an expert in wall street and //finance. The whole bunch of them are what people in my part of town call pussies. I have more //respect for OWS than the group of whores on cable.