Are you referring to short selling as being financial engineering and only available to few sophisticated users? Short selling is actually very straightforward and requires only a little thought, it is also available to anyone with a reasonable grasp on the subject. All relevant information can be found on public forums, like this one.
The recent turmoil is a failure of regulation, not a result of short selling.
No, as u can see from the 1st sentence of my post, i dont think short selling should be stopped at all.
my belief is that complex engineering of short selling on a massive and highly leveraged scale is where the problem potentially is worst, and the possibility of regulation needs to be examined.
this strategy is not available to anyone or everyone
the playing field is not level.
these strategies are only available to large players.
I believe such strategies favor the very wealthy, as only they can participate.
(only large players have institutional acces to really large parcels of shorting stock)
the potential for destabilisation, and wealth destruction of the majority is the question i raise.
i question in whose interest it is for exmple for say MQG to go down then up 30% in 2 days, and what role shorting and covering plays in that.
great for u if u made the right call 2 days running and were highly leveraged!
but for the majority...not good.
I am all for reasonable profit making potential, but if the risk of massive wealth destruction is increased by certain situations, my opinion is that should be considered.
Tech A post highlights some of these risks
i think most people would agree that the "financial masters of the universe" function at the cutting edge of capitalism, and "for want of a better word" are greedy.
i personally myself would prefer that limitations be imposed on methods that allow vast profits (or loss) potentialities to cause severe systemic risk.
shorting as a whole does not cause that risk.
massive undisclosed highly leveraged shorting, maybe that does.
of course i acknowledge my opinions may be incorrect..my old socialist tendencies must be creeping up on me!