Ban the Bear

Eliezer Yudkowsky

I applaud the SEC's courageous move to ban short selling. Isn't that brilliant? I wonder why they didn't think of that during the Great Depression.

However, I feel that this valiant effort does not go far enough.

All selling of stocks should be banned. Once you buy a stock, you have to hold it forever.

Sure, this might make the market a little less liquid. But once stock prices can only go up, we'll all be rich!

Or maybe we should just try something simpler: pass a law making it illegal for stock prices to go down.

I applaud the SEC's courageous move to ban short selling. Isn't that brilliant? I wonder why they didn't think of that during the Great Depression.

However, I feel that this valiant effort does not go far enough.

All selling of stocks should be banned. Once you buy a stock, you have to hold it forever.

Sure, this might make the market a little less liquid. But once stock prices can only go up, we'll all be rich!

Or maybe we should just try something simpler: pass a law making it illegal for stock prices to go down.

Jason, they banned all short sales of those stocks (except for "certain bona fide market makers" and some option exercises). From http://www.sec.gov/rules/other/2008/34-58592.pdf:

IT IS ORDERED that, pursuant to our Section 12(k)(2) powers, all persons are prohibited from short selling any publicly traded securities of any Included Financial Firm.