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Politics : PRESIDENT GEORGE W. BUSH
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To: cosmicforce who wrote (357813)2/11/2003 8:38:34 PM
From: sea_biscuit  Read Replies (1) of 769670
 
Japan did this -- banning short-sales. The forced covering took the markets up 22%, and once the buying pressure dried up, it was downhill again. And today, we are down 15% from the point where they banned short-selling, just about a year ago.

Short-sellers are the only committed buyers -- they are required to buy at some price, unlike the others, who are not required to buy. All that the banning of short-selling will accomplish is to prop the markets temporarily. In the longer run, fundamentals, and the longer-term trend, will assert themselves.

The secular bear is a mighty beast. It is not going to be scared by little pinpricks like the ban on short-selling.
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