1987 Stock Market Crash Shows How Short Selling In 2008 Is Crushing America

Posted by on Nov 23rd, 2008 and filed under Marketplace, Newsmakers. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry from your site | Viewed 72408 times.

The stock market crash of 1987 seemingly taught America how to protect its markets. We have forgotten.

Laws were enacted to protect America from a recurrence of such an event, but the laws that protect us the most have been discarded while those that merely draw out the process live on.

The core of the problem in the stock market today is not the economy. It is not the drop in home prices. It isn’t even the overplayed “mortgage crisis”. It is SHORT SELLERS!

Short sellers can manipulate markets, especially those with large capital bases, using fear as their primary mechanism for fast money. They can cause market sell-offs, pay for false rumors and news articles (propaganda/lies), and drive a stock into sudden collapse. They love to play on fear, because it results in much more dramatic moves in stocks than greed, but in all honesty, it is just greed by the billionaires and hedge funds to play off middle class investment dollars.

In 1987, short sellers were blamed for much of the dramatic fall. They fed on the stocks as they fell to drive them lower paying for rumors and fear to be published in the media to drive people out. There were protections put in place to keep this from happening again, but the rich have managed to get government to get lax once again.

How to fix our problem.

1. Reinstate the uptick rule. It does not allow short sellers to drive a stock down relentlessly, because a stock must rise in price before they can short it.
2. Make naked short selling a federal crime with severe criminal penalties.
3. Ban all short sales during a trading curb.

That is all you have to do. Take away the advantages short sellers have in a market driven by fear. Don’t let them make money in that environment. Even the playing field and save people’s retirement savings.

We are all for short selling, if legal. We are not into stock manipulation by criminals, hedge funds and billionaires. If America were serious about protecting our economy and our markets, rules such as this would be instated, but we believe there are vested interests involved.

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5 Responses for “1987 Stock Market Crash Shows How Short Selling In 2008 Is Crushing America”

  1. David@stock says:

    I’m just like you. I crave the good things in life. And while money can’t buy happiness, it sure can buy everything else! Who wouldn’t want a million dollar home, or their kid’s college education paid for? Sure…a Volkswagen is nice, but isn’t a Mercedes or BMW even better? I’m confident that with enough money in the bank I could finally take more than one vacation a year, or have enough to put away for retirement. And more importantly, have the means to pay off multiple credit card debts, school loans, and medical bills.

  2. Why will people not believe in matmatical probabilities? For example, earthquakes in California? Yes, mathmatically probable, proven by supercomputer inputting, yet people don’t want to beleive that there will be an earthquake in California. They really believe in a belief system, erq, As I believe, so I shall become, it is called visualization. This is how this stock market and bank failure happened. That and an national addiction to gambling. Back to math, simple math has to be taught in schools again. for example 2 plus 2 equals four not ten!
    A simple country girl who invested in herself and her property and hasn’t lost much over the years except sweat, tears, and finally has reached a middle income median. (which my NY cousin fondly refers to as his gaining a few pounds) Thank you for letting me sound off.
    Remeber what Grandma said, If it sounds too good to be true it is!,
    also The best things in life are free, such as giving someone a smile,
    she also said nothing in life is free, so she was complicated.
    Susan (Falsetti) Breloff

  3. s you for sponsoring the materials, a lot of riveting news. sympathetic-bye.

  4. […] our earlier article we explained how speculation was crushing our financial institutions in the same way it drove oil […]

     
  5. […] problem is primarily perception being brought on by speculators and short sellers. In September, this was so obvious, that a temporary moratorium on short selling of financial […]

     

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