Loans and Finance

Loans and Finance

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Friday, August 12, 2011

Europe Plays Canute

France, Italy, Spain and Belgium have decided to take on the role of King Canute and are attempting to turn back the tides of the markets. They have banned the short-selling of banking stocks.

The ban will last 15 days.

A similar ban was put in place in 2008.

The result?

The shorters were proved right.

As such this ban will have little positive effect, and may well exacerbate the situation.

1 comment:

  1. As long as the crisis exists, investors will continue to lose confidence in the economic recovery which will make them decide to invest less in the global economy.

    ReplyDelete