Now Brace for Short-Sellers

Wall Street steels for end of ban short-selling
By Peter Fearon,  Newser Staff
Posted Oct 8, 2008 6:01 AM CDT
A specialist directs trades at a post on the floor of the New York Stock Exchange. The ban on short selling financial stocks ends at midnight Wednesday.   (AP Photo/Richard Drew)
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(Newser) – The controversial three-week ban on short-selling financial stocks ends at midnight tonight and analysts are uncertain about the impact on an already-traumatized Wall Street. Financial shares have plunged 23% since the ban was imposed, suggesting short-selling might not have played as large a role as suspected in earlier declines, reports the New York Times.

“If there had been no ban, would they have gone down even more?” wondered an MIT economics professor. “We just don’t know in a state of panic what the outcome would have been.”