Saturday, December 17, 2011

To Ban Short Selling Of Financial Assets Is To Be Short Sighted

Clueless About Economics

Politicians, economists, or regulators who favor banning short sales of financial assets have no clue about economics. They certainly have never understood how financial markets operate. Such a ban is like a barometer or measure of fitness for office of any politician or regulator.
Convenient Scapegoats
In the medieval ages we had witches and sorcerers. In the modern age, we have speculators and short sellers. When will the so sophisticated intellectuals, economists, and politicians finally use their brains instead of cheap scapegoating to deflect from own failure.
Free Markets Depend On Speculators & Short Sellers
Speculators and short sellers are essential to price discovery in a free market economy. They are the risk takers and canaries in the financial markets. Many loose their money, only a few are successful. When the few are successful somebody gets hurt, but for a reason.

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