The damage being done to stocks through short selling, where Wall Street’s most legendary institutions are losing value at alarming rates, could be the work of financial terrorism.
Cramer’s been talking to the short sellers he knows, and that’s the theory they’ve been putting forward. His sources said that it’s doubtful that the market’s traditional short sellers are behind the negative action we’ve seen lately. So there is the possibility that someone else has been trying to wreak havoc in the markets rather than just profit from the problems of Goldman Sachs
, Morgan Stanley and others.
Cramer, who was merely relaying what he heard, did say that, given the fact that the U.S. is in a “financial nationally emergency,” the “financial terrorism thing, to me, has to be put on the table just because the regular short sellers are not doing this.”
The Mad Money host urged the U.K.’s Financial Services Authority, which just banned short selling in financial stocks and now requires stricter disclosure from short sellers, to find out who’s on the other side of these trades.
In the U.S., though, the Securities and Exchange Commission should bring back the uptick rule, Cramer said. That rule requires a stock to tick up in price before it can be sold short.
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CNBC: http://www.cnbc.com/id/26778065