An English bibliotaph of fifty years residence in Wales pontificates about politics (slightly off-message), films and trivia. Acting secretary of Aberavon and Neath Liberal Democrats. Candidate for Neath in the Westminster elections of 1997 & 2017 and the Welsh general election of 2016.
Wednesday 28 January 2009
Short selling
Can some economist please explain how betting on an event alters the outcome of that event?
2 comments:
Anonymous
said...
Could it be like Quantum Physics, whereby measuring the position of a subatomic particle actually alters the postion of that particle?
Now that is a brilliant question that I have never heard anyone ask about short selling before. The nay-sayers will tell you that the short sellers create a self-fulfilling prophecy by driving down the shares of companies to levels that are unwarranted. Of course, that doesn't explain why UK bank shares kept going down during the short selling ban. The nay-sayers avoid that issue. Well done!
2 comments:
Could it be like Quantum Physics, whereby measuring the position of a subatomic particle actually alters the postion of that particle?
Now that is a brilliant question that I have never heard anyone ask about short selling before. The nay-sayers will tell you that the short sellers create a self-fulfilling prophecy by driving down the shares of companies to levels that are unwarranted. Of course, that doesn't explain why UK bank shares kept going down during the short selling ban. The nay-sayers avoid that issue.
Well done!
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