I agree! Naked Short-Selling is bad, and is totally unenforced. I suspect that a lot of hedge funds got very rich this week ...and... likely cost stockholders and tax payers millions (if not billions) of dollars.
You should certainly read the www article Deep Capture which is an extensive detailed article by Patrick Bryne who is the CEO of Overstock Com ...and... very knowledgeable of how the market really works and can be readily manipulated. The article is long, but highly interesting and covers NSS and other market shenanigans.
There are clearly a couple of guys that should do the perp walk. See Jim Cramer in Chapter 1 of Deep Capture and Chapter 2's Gary Weiss.
Weiss is also likely involved in:
"Speaking of strange places from which to post [Gary Weiss]: at the heart of our nation’s stock settlement system, and hence, at the heart of the issues of concern to DeepCapture, is a nearly unknown corporation called “The DTCC.”
The company provides settlement for the nation’s capital market: $1.5 quadrillion in trades are settled there every year (that is, about 30X the economic output of the entire planet). For most of its history it has largely escaped regulation: state regulators are admonished that they cannot peer inside because the DTCC is federally regulated, and the DTCC has told federal regulators it escapes their regulation due to its strange ownership structure (one former federal regulator, and one former employee of the DTCC, have both told me the feds would not know where to begin if they tried to regulate it).
In short, at the heart of the world’s economy is an enourmous black box that is regulated except on the days it’s not, and through which 30X the economic output of the world flows. It is my contention that much of Wall Street’s illegal activity is funneled through this strange entity.
The huge, nondescript building in downtown Manhattan that houses the DTCC is something of a Fort Knox. Long-gun toting guards watch the entrances, and journalists who have been inside tell me that entering it is tougher than getting into the Federal Reserve or any comparable institution.
Gary recently made a slip that revealed he was inside the offices of the DTCC, using one of their computers to post on Wikipedia about the DTCC. Given that it’s like getting into Fort Knox, I’m pretty sure that’s odd. However, it casts some light on why Gary has been stridently denying that the DTCC is dirty and that none of the issues I have been raising regarding stock market manipulation are legitimate, and why he has (according to a colleague of his in the financial press sympathetic to me) devoted 93% of his blogs to criticizing my efforts to expose the illegal Wall Street activity which, I claim, intersects within the DTCC. Just as interestingly, when given opportunity to comment, the DTCC went into cover-up mode straight out of Bizarro World."
(The above italic quote is from Chapter 2 which has numerous links in the above)
[You may also remember Gary from the big 'bru ha ha' at Wikipedia about who could edit articles in 2006 that even sucked in its founder Jimbo Wales. (Also covered in Chapter 2 of the above article.)]
In any event, the eight Chapters in the above Deep Capture by Patrick Bryne are both interesting and frightening if you really want to understand how Wall Street and the Market really work.