RE: manufactured oversupply14 Aug 2015 17:09
I am sure that sebwood and Jolly would be the first to defend the thoroughly honourable practice of shorting ,since they obviously attempt to take advantage of it. In reality shorting is is creating market distortions and is probably negatively impacting the real economy.
The mere fact that a share is being shorted ,even if the reasons for the shorting are entirely illegitimate will tend to deter potential investors . Whereas the investment houses that indulge in shorting are regulated by the "authorities" they are being piggy backed by assorted shysters and scum who are not regulated. These shysters are free to do their very best to spread fear and consternation to fleece their own nest . This is inherently unfair.
Shorting is a bizarre concept , why is it possible to sell something that you do not own ? i am sure that if I set up a system to short the governments beloved housing market and sold short a shed load of frothy London properties the "authorities " would rapidly put a stop to it . Indeed I believe they banned the shorting of banks during the peak of our recent ( and continuing ) financial crisis, so they are very selective in what they allow.
How many small and medium sized companies are there that are looking for finance to expand and create employment ? They have the choice of the banks that are very unlikely to assist in the present environment or perhaps a listing .The primary function of the market is after all to raise funds . They will take a look at the negative implications of a listing as exampled by all the shorting and decide that the market is not fit for purpose, so further enterprise and employment is put on hold.
Jolly you state that doubts expressed by your mate TW over QPP were not misplaced . Think again,they were the best part of a billion $ misplaced . The man is a complete buffoon.