Jim Cramer: Shortselling The Truth

[Oilwellian]

Jim Cramer describes in detail how Wall Street shortsellers illegally raided corporations and their investors.
This video will give you some insight into how these thieves operated and how they greatly contributed to the
economic crisis we're facing today.

This is a do-over from the video I posted in the Political Videos forum the other day.
Hopefully it is much more concise and explained in a way for the viewer to understand.

Explaining shortselling was no easy task.

http://www.youtube.com/watch?v=1qxdJ3FdRZM

And if you're so inclined, a rating and comment on YouTube would be most appreciated.
Let's put this baby in the top 100 of the YouTube News & Politics forum. Thanks! :D

[notesdev]

1. Short selling isn't the problem

Fraud is the problem. What Cramer describes is a fraud.

Normal shortselling is simply a bet that a stock is overvalued. Short sellers turned out to be very correct in this latest bear market - they did us all a favor by limiting just how far out of control this bubble got. I'd actually be hard pressed to name any other limits to the size of the bubble that were actually effective. All regulatory, legal, and economic barriers to bubble-blowing were either corrupted, ignored, or deliberately misused, and a short seller recognizing that the resulting prices were unsustainable is not at fault for the situation.

If a company is solid, if an economy is solid, a short seller will lose his shorts. Either way, the mechanics of short selling are straightforward and non-fraudulent.

It doesn't surprise me that the shorts are being demonized by market insiders now, since it was the shorts who called the con game for what it was - a ruse - and were prepared to put their money where their mouths were.

It's the market bulls, the ones who think they have some sort of divine right to bubble prices, who want to put OUR money where their mouths are, and not give us a damn choice about it.

[Oilwellian]

2. Evidently you didn't listen to the video

Shortselling was rife with corruption and manipulation of corporate stocks. Cramer blatantly admits it on video. They bled companies dry.

A call to halt shortselling on nearly 800 corporations was made last September. I highly doubt they played a role in limiting the control of the bubble. They helped create the damn thing.

[notesdev]

3. I did in fact do so

and, if you read what I wrote, I stated unambiguously that fraud is the problem. What he describes is racketeering. We have laws that punish this behavior - if those laws are enforced.

So where are the prosecutions of all this rampant fraud that was going on, that is what I want to know. I see a handful of individuals doing the perp walk, while many others are walking away with their stolen money and getting away with it.

Shorts by definition cannot create a bubble. They are explicit bets that a stock will go down. In a bubble, the shorts lose. Jim Cramer was one of the bubble's biggest cheerleaders - of course he hates shorts, they made him look like the fool he is. Nobody likes it when their (quite lucrative) bluff is called.

[unblock]

5. wow, you've got to be the first person ever to argue that selling inflates prices.

you're conflating a legitimate trading technique with illegal other activities designed to make the trading improperly lucrative.

corruption and manipulation is bad, evil, criminal, and all sorts of negative words you care to use.
short selling in and of itself is not, provided it's done with reasonable limits and without corruption and manipulation.

don't throw out the baby with the bathwater. short selling should be carefully limited and monitored, but not banned.

insider trading is corrupt and manipulative, too, but no one would argue that BUYing stocks should be banned.

[DemReadingDU]

4. I remember the original video from a couple years ago

I was looking for this video just a few days ago, but it is no longer actively embedded in this article. Thanks for the youtube version.

http://www.usatoday.com/money/markets/2007-03-23-cramer-usat_N.htm