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To: Dave B who wrote (23675)	6/25/1999 2:08:00 PM
From: GVTucker	Read Replies (1) \| Respond to of 93625

Dave, short selling primarily provides liquidity to the market. The only time that short sellers themselves have any true price impact on a stock is in the case of outright frauds (obviously not the case here) or in the case of the very rare short squeeze, which may be unfolding right now. On the other side of the coin, without short selling, a large buyer or seller would have a huge market impact. If you prohibited short selling, you'd have to also prevent market makers from short selling. Market makers subsequently couldn't quote near the market they can nowadays, which would lead to much larger spreads. In turn, that would mean that a large buyer or seller would have to influence the market to a much larger degree, increasing volatility. Then again, given that I am one of those nefarious short sellers, you can assume that I am speaking from a rather biased point of view.