Why is this taking so long?
There’s a move afoot to tighten the regulations limiting naked short selling and to reinstate the uptick rule.
These reforms were prominently discussed last fall, even on this blog. So, why is it taking this long? Especially when so many other things have been fast-tracked.
For reasons not clear, they decided to just ban all short-selling, even though short-selling per se had not been the problem and in fact helps price the market properly. I don’t hold with naked shorting, and was shocked to learn it had actually been allowed for some time. Why they decided to kneecap a perfectly valid tool (which on its own can’t drive down prices) I do not know.
They don’t want the markets to work right. If the markets work right, there is no need to create a command economy. Only the “failure” of the over-regulated, distorted and hamstrung version can justify taking them over to make them tools of the Executive and the Congressional Seniority.
Both the uptick rule and a prohibition of naked shorting are useful regulations. If we care about properly functioning price discovery, we have an interest in discouraging bear raids.