Short selling lies

Debt_Free_Chick

Debt_Free_Chick wrote: »

Anyone else have a slightly uncomfortable feeling about the Government interfering with the markets?

Surely ... the markets determine the value of shares. Now the Government seems to have a say in it.

Doesn't seem right to me ..... any other views?

Hold on a minute .......

The FSA is banning "short positions in publicly quoted financial companies"


So it's only interfering in part of the market :eek:

Truly bizarre - or am I missing something?

tradetime

Debt_Free_Chick wrote: »

Anyone else have a slightly uncomfortable feeling about the Government interfering with the markets?

Surely ... the markets determine the value of shares. Now the Government seems to have a say in it.

Doesn't seem right to me ..... any other views?

Well if the bank stocks are not getting hammered they will not be in the news, and we can all get back to pretending that everything is ok, it sets a dangerous precedent, whilst achieving very little, shares of banks with troubles will still fall in value, perhaps just a little slower, and it may just serve to prolong or even worsen the financial crisis.

baby_boomer

Debt_Free_Chick wrote: »

So it's only interfering in part of the market :eek: [financial companies]

Truly bizarre - or am I missing something?

Other companies can't be driven to bankruptcy on the markets in the same way that a bank can, since a falling share price reflects on its credit ratings and its ability to raise money in the wholesale markets - and liquidity issues were at the heart of both Northern Rock & Halifax difficulties.

In addition the confidence thing could lead to a run on the bank.

You wouldn't stop shopping at Sainsbury's because you heard its shares were in trouble, but you might pull your money out of / stop doing business with Halifax if the internet rumour mill said they were up the creek.

esbo

Debt_Free_Chick wrote: »

The institutions who, in this country, own the vast majority of UK shares. Pretty sure they all do it. So if you have units in any fund, don't be surprised to find that the manager undertakes some stock lending.

It's been "normal practice" for so long as I can remember (about 25 years).

Point is they don't own it so it is not theirs to lend, basically they are profiting by allowing your stock to be trashed. They are not acting for you they are acting against you, basically robbing you under your very nose.
No wonder all the pension funds are underperforming, the fund managers are robbing you.

The fact they been robbing you for the last 25 years is hardly a justifiation for it.

tradetime

baby_boomer wrote: »

Other companies can't be driven to bankruptcy on the markets in the same way that a bank can, since a falling share price reflects on its credit ratings and its ability to raise money in the wholesale markets - and liquidity issues were at the heart of both Northern Rock & Halifax difficulties.

In addition the confidence thing could lead to a run on the bank.

You wouldn't stop shopping at Sainsbury's because you heard its shares were in trouble, but you might pull your money out of / stop doing business with Halifax if the internet rumour mill said they were up the creek.

I see your point re confidence etc, but I'm sure you cannot imagine that preventing short selling will do anything other than drift a bit of smoke over the issue. Northern Wreck went under because it was managed by idiots, and regulated by idiots, not because of a run on the bank, the run just sped things along. Interestingly, now some of the idiots who regulated it are extending their role in the stock market. Hmmn I wonder how that'll turn out.

esbo

Debt_Free_Chick wrote: »

Anyone else have a slightly uncomfortable feeling about the Government interfering with the markets?

Surely ... the markets determine the value of shares. Now the Government seems to have a say in it.

Doesn't seem right to me ..... any other views?

If it is interfering to stop corrupt practices I have no problem with that.

And it should stop corrupt practices in all markets, not just financial ones.

ed123_2

....naked short selling of shares....(not selling shares while in the bath..<:-)...ie selling shares you don't own/or even have borrowed I think was partly the cause of HBOS's downfall...how they do it I have no idea....but image doing that in other areas...you like that house mate..its yours for 100k...one small problem I don't own it..... Darling/Brown appear to be trying to put a stop to this to-night...a bit late when many HBOS staff will be losing their jobs..

Debt_Free_Chick

esbo wrote: »

Point is they don't own it so it is not theirs to lend, basically they are profiting by allowing your stock to be trashed.

They do, if you invest in unitised funds - which very, very many pension funds do. As an investor, you only own "units" - you don't own the underlying investments (stock).

They are not acting for you they are acting against you, basically robbing you under your very nose.

No robbing involved - sorry. It's normal practice - and I have to stress, that there is no such thing as stock "lending". The legal title is legitimately transferred to the "borrower" (more technically, the "buyer").

No wonder all the pension funds are underperforming, the fund managers are robbing you.

The fact they been robbing you for the last 25 years is hardly a justifiation for it.

Stock lending is not responsible for poor performance. And outperforming falling markets is pretty much miraculous - although, not that difficult. It's a well proven statistical "fact" that active funds outperform in falling markets Well .... when markets are falling for good reason, rather than simply on irrational sentiment

Regards

esbo

Debt_Free_Chick wrote: »

They do, if you invest in unitised funds - which very, very many pension funds do. As an investor, you only own "units" - you don't own the underlying investments (stock).

Yes you do own the stock, you own the unit and the stock it contains, the broker
does not own it because he has no !!!!!!! paid for it. If you don't own the stock
then you pensions is worthless.

Debt_Free_Chick wrote: »

No robbing involved - sorry. It's normal practice - and I have to stress, that there is no such thing as stock "lending". The legal title is legitimately transferred to the "borrower" (more technically, the "buyer").

It is robbing, it being normal practice does no mean it is not robbing.
He is not buying my stock because I am not selling it, and one selling my stock behind my back is a common thief.

Debt_Free_Chick wrote: »

Stock lending is not responsible for poor performance. And outperforming falling markets is pretty much miraculous - although, not that difficult. It's a well proven statistical "fact" that active funds outperform in falling markets Well .... when markets are falling for good reason, rather than simply on irrational sentiment
Regards

Thats all irrelevant it does not excuse the theft of my stock Not sure what that stuff
about markets is about but it is irrelevant, it is a question of theft alone, all the rest is a smoke screen.

Debt_Free_Chick

esbo wrote: »

Yes you do own the stock

You don't - you own a share (unit) of the investment pool. How can you possibly own the stock? Your investment is pooled with those of others. The total pool is used to buy stock. Let's say that you have 10 units in a UK tracker fund. There are other investors and, in total, there are 100 units. That fund is invested in Lloyds TSB, RBS, Vodafone and Prudential.

Which stock do you own? You only own 10% of the total pool. You don't own 10% of Lloyds, RBS, Vodafone and Prudential. If you think you do and you have invested in unitised funds, you are in for a big shock :eek: Sorry. But the stock is actually held by a nominee - it's not even owned by the investment manager running the fund :eek:

You only own 1-, you own the unit and the stock it contains,

And if 1 unit is equivalent to 0.00631597169717% of one share, what do you own?

the broker does not own it because he has no !!!!!!! paid for it. If you don't own the stock then you pensions is worthless.

The investment manager (not the broker) owns is - albeit, via the nominee. He has paid for it and YOU gave him the money to buy it. In return for your money, you got units in the fund - you did not buy the stock.

Your pension is not worthless - it's worth the number of units you've bought multiplied by the price of those units. The price of the unit is a "composite" i.e. the total value of all the stocks divided by the total number of units held by all those who've bought that fund (OK - oversimplification there, ignoring all the charges, but the principle is sound).

It is robbing, it being normal practice does no mean it is not robbing.
He is not buying my stock because I am not selling it, and one selling my stock behind my back is a common thief.



Thats all irrelevant it does not excuse the theft of my stock Not sure what that stuff
about markets is about but it is irrelevant, it is a question of theft alone, all the rest is a smoke screen.

I honestly hope you have no collective investments. Really I do. If you do, then you have no idea of what you own .... or, more accurately, you have no idea of what you don't own