[Tom D.]

Short selling serves an important function. To make it illegal would be a mistake. What is bad is allowing naked short selling (selling stock short without officially “borrowing” the shares from an owner). Winking at naked short selling was the SEC’s biggest sin here.

Of course there is mischief that can be done with shorting, but there is mischief that can be done through making it illegal. It is sort of like fire: it can be dangerous, but the benefits outweigh the downside.

[StatenIsland]

“Short selling serves an important function. To make it illegal would be a mistake.”

Tom or anybody, this is a serious question. Why is short selling necessary to a healthy market? I fail to see its purpose beyond the obvious nefarious one: sowing panic by putting artificial downward pressure on a stock’s price.

And don’t even get me started on naked shorting - its like being in a casino where you’re playing with house money. Just sell till you wipe out all the longs, and KEEP selling till the average investor panics, the margin players get calls and all the stops are wiped out.