In Defense of Speculators

Motivated by the clampdown on short selling of financial stocks, the Wall Street Journal says

That is one takeaway from Washington’s recent response to market turmoil. By singling out “speculators” who want to push bank stocks down and oil prices up, lawmakers and policy makers reinforce a message that the free market is a wonderful thing as long as it isn’t going against you.

From the list, you could also surmise the SEC is trying to keep last year’s stock bonuses above water, for its buddies of course.

UPDATE: Yet the WSJ contradicts itself a little while later, lobbying for return of the uptick rule. The argument cries out “Save my retirement account from those evil short-sellers.”

Nobody was whining when the financials were reporting billions upon billions in fresh new earnings during the mortgage boom. Now that those financials are writing off the same billions and their stocks are reflecting that fact, deflecting blame is the obvious reaction.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.