Whatnogravy
Re; "...I don't think any rule exists that could prevent that scenario. I guess the thing is that currently the people that short the bejesus out of stocks have no long term interest in the stocks so it is not an issue.
Also because this manure is undisclosed it probably wouldn't be immediately clear that the entity making the takeover was behind the shorting. Thats why our market is such a cowboy market (not just the shorting, the insider trading as well)..."
IMO your comments are right on the money. While I acknowledge that legitimate shorting is part of our market it differs from long trades:
. All long trades have to be cleared & are visible - they represent a decision to help companies grow through their endeavours & enterprise [capital risk taking, work & time are essential].
. The Australian has printed numerous articles detailing the abuses of shorting on the ASX. In summary what deeply disturbs me is covered shorting, invisible day shorting, unsettled shorts, multiple shorting of the same share & what appears to massive opportunity for tax evasion.
. IMO shorting counters / undermines / destroys investment [ie. it is really disinvestment & that opens up opportunities for unethical practices, including insider trading].
. IMO shorting is a destructive, parasitic gambling practice & talk of assisting liquidity is just a facile excuse!
IMO the impact of shorting is evident in that the ASX introduced cfds at the start of November 2007 - what was significant about that you say?
Although I continue to invest locally I have little confidence in the ASX. IMO we need an alternative boarse & massively improved regulation & prosecution regimes associated with the abuse of shorting & insider trading.
4YIO - NFA
OXR
oxiana limited
