not being a shorter myself, I have been trying to see both sides. there has to be a way of profitting from dodgy companies I reckon, why should the CEOs be able to bleed a company dry while the market has to sit back and watch. I think it sucks when a company might want to do a cap raising and expand and shorters know that will affect the share price so they 'attack' that company who might be sound otherwise but then the cap raising is affected. I don't trust hedge funds shorting their own stock either, as they can just throw the loss into a super fund or w/ever and keep the gains for their preferred clients.
The problem with the industry is there are simply too many degrees of seperation. Limit and regulate the degrees of seperation and hopefully it will become more transparent.