Monday, September 22, 2008

Short Sellers Are Just The Messengers

Bill Fleckenstein:

I continue to see arguments that short-sellers and the no-uptick rule can ruin companies. Lehman is a perfect example of how that is not the case. Lehman's books were shown to virtually every person on the planet older than 16 with more than 50 bucks in his pocket, and nobody wanted it. People didn't want it because it was essentially a bankrupt entity (once its assets and liabilities were netted out).

To suggest that short-sellers made this happen is just ludicrous. If short-sellers were so stupid as to drive a viable, valuable company down below where it was worth, buyers around the world would have leaped at the chance to buy it. I know that's a bit of a digression, but I'm sick and tired of hearing the wrong people blamed.

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