Short Selling28 Jan 2021 19:38
If you want to stop short selling, write to Boris and tell him to ban it. If enough people do it then we might have some effect.
You can email using the form on the page, or use the postal address (select it in the drop down list and click GO).
https://email.number10.gov.uk/
I am writing with the below (plus some more, but it doesn't all fit in one post!) Feel free to copy and paste to other boards.
(I do hold DIS)
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Dear Prime Minister,
If you want to rebuild the UK to:
1) Greatly increase our GDP
2) Foster and encourage entrepreneurship
3) Export huge amounts of technology around the World
4) Show the EU that we can be bigger outside of the EU
5) Build an economy where everyone is employed
Then you must ban short selling of UK listed companies. You need to bypass the FCA and the Treasury and make the decision for them, for the good of the Nation.
Many petitions have been raised over the past two decades asking for short selling to be banned, but these never had any effect due to the FCA not understanding the real issue, which is not 'whether the market works' it is 'whether short selling destroys UK listed companies".
Short selling is destroying the value of UK listed companies constantly. In many cases it actually destroys the companies and they go into administration.
I cannot borrow your house (an asset) or car (an asset) and sell it, I would be in court for fraud if I did, therefore I should not be allowed to borrow your stock in a listed company (an asset) and sell that either, as that is equally fraud.
I have held several UK listed stocks that have been shorted, in some cases they were approaching raising funds, to either keep the company running or to move the business up a level. Because they had gone out to Fund Managers to place stock, the Fund Managers then leaked that information and the Hedge Funds plus traders shorted the stock. This helps the Fund Manager taking the placing stock to get that stock as cheap as possible, whilst the Hedge Fund also makes money. The loser is always the small UK Company and all of the investors that have put their hard earned money into it, mostly private investors.
Look at many small cap UK listed companies. Before they could make it to profitable revenues and reward it's shareholders, it has already been destroyed as an investment by multiple shorting events causing huge dilution to shareholders, in most cases the early investors, often private investors, never make it into profit.
Short selling destroys:
1) Listed company value
2) The valuations of early investors holdings, often Private Investors
3) The value of everyone's Pension Funds that hold the stocks being shorted (how many times have we seen a Pension Fund underfunded? many times)
4) The incentive for Private Investors to invest in UK listed companies
5) The attraction of foreign investment into UK listed companies
6) Entire companies, forcing them into administrat
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