Should have seen the show on SBS last night. A "trader" shorting a coy bitched that he missed the really big fall in the afternoon - he even predicted it that morning - but the interesting thing was that he did not care about that coy at all - only what he would make if its sp fell.
1) I have heard self-righteous short trading supporters saying that shorting identifies coy's with weak management or business plans. I have heard these ppl say that with their help, the investing public can be alerted to questionable coy's. These remarks were all been made in public forums, e.g. on TV or for the media. However, not once has someone actually shown that a coy was being shorted for these motives - its all been about if a profit could be made.
2) Short selling is a self-fulfilling mechanism - to short is to cause a fall in a sp and a fall in a sp can create concerns in other investors minds, which can perpetuate even further falls.
3) A "few" shorters make a profit destroying the wealth of hundreds, if not thousands of SH's. I make a profit by investing in a company that makes dividends or has the potential of future dividends - the better the potential, the higher the sp will probably rise. When I sell, I sell what I own and I sell it to someone else - it benefits me in some fashion and presumably it benefits the buyer in some fashion too. Its one on one. Its just that simple.
BTW, ppl purchase two types of items with their credit cards. The things they need and the things they want. If they have a need, then the purchase is justified. If they just want something they can do without, then its not really justified in "hard" times, unless they can easily afford it. Nothing has changed, it has always been so and will continue to be so as long as these financial "products" are available.
