If you trust a company or commodity, you buy it.
If you dont: you dont buy it.
>Why should shorting be banned?
Shorting has no economic benefit! It disrupts supply and demand and allows markets to be manipulated.
There are multiple examples of shorting unneccessarily destroying countries, companies and other markets:
Greece (2008)
Bank of England, malaysia (George Soros)
Numerous companies
Other urls found in this thread:
coinmarketcap.com
coinmarketcap.com
twitter.com
Stay on topic please
The proposition of debate: Shorting disrupts the market and should be banned!
>If you trust a company or commodity, you buy it.
Like trusting it to increase or decrease in price?
Who gives a fuck?
1. Who are you talking to?
2. Learn about the origins of short contracts or gtfo this board you pleb.
Regulations suck cock.
If there's a demand for shorting, it should be available.
Without shorting bubbles form.
Found the Jew.
no, it helps price finding and increases volume, pinko.
I don't think the problem is shorts so much as 'cash-settled' contracts. This allows you to short or long without ever having to buy the commodity. If you're going to short, you should at least have to possess or own said commodity
Everyone invested in stocks and shares.
The real problem is fake money, it's used to pump and dump the market. This can only end in retail investors suffering while banking cartels fleece them
>Why is this topic relevant (paraphrase)
A company has stock, some people decide to invest in it because they believe in it.
Then people sho dont believe in the company short the stock and ruin that companies chance to get capital for their business.
Conclusion: shorting disrupts free association of people that have invested in something.
For example: people who invest in crypto are being financially hurt by crypto shorters. What gives those shorters the right to short crypto and "stealing the money" of the crypto investors?
If those shorters dont believe in crypto they should FUCK OFF instead of SABOTAGING the market (supply and demand).
So like, it's called a short because it's a position you should only open for a SHORT amount of time.
A long would imply that you open it for a long time.
What's so complicated?
If you want to play in a market where you can't short sign up for robinhood.
I have always agreed with your position, and there is nothing worse than seeing an otherwise healthy company destroyed by a handful of coordinated shorts.
But I'm starting to change my position on this, especially after seeing the crypto bubble.
Without shorts, prices are entirely determined by longs. So in the buy / don't buy system, you will always have a steady (or not so steady) rise in prices. Not rational pricing, mind you, but irrational pricing to bubble levels.
Look at the price of any of your favorite cryptos. Look what happened before people were allowed to short and after.
It might also be argued that shorting is necessary for the market to function. Every buyer requires a seller; every seller requires a buyer. When you eliminate one, the other can't function.
This thread is not about the origin story.
Its not my problem you majored in history.
This. Naked shorting is honestly cancerous. It's the same as banks lending out money they don't have.
You do realise that shorting doesn't drop the price in and of itself, don't You?
Please explain the economic mechanics behind your statement
>t.brainlet
Before 2008 shorting was possible but 2008 collapse still happened. In fact shorting was a huge problem in 2008 (see Greece)
[Only reason I wont call you a retard is maybe you have some genius explanation for your statement]
Meh, shorting simply means if you're a HODLer, you lend me some of your assets for a fee. It can be implemented in a decentralized way (using stablecoins) so there's no salvation. Some HODLers will always be willing to get more on top of what they have, and there will always be shorters. Some DEXes already make first attempts at leverage trading.
Maybe I'm a brainlet but why do you need shorting to destroy bubbles? Just sell/close your long.
Very good point! Most banks actually hide that they never bought the commodity.
They pretend they did vut its just cash settled contracts.
if not allow short
then only big guys can short
which just them sell
you want big guys have even more advantage?
how about a person knows a company is crap, but without financial incentive (shorting) will not communicate this insight to the market resulting in misallocation of resources.
"no"
If you hold a long position, you expect the price to trend upwards. If you hold a short position, you expect the price to trend downwards.
You can hold a long position for a day, or a short position for a month.
There are multiple types but in general shorting creates extra supply.
This is the case when the bank actually holds the commodity and sells it.
But please explain. I am a novice on this topic.
IMO the actual existence of shorts in an asset is what may cause it to drop. When traders see a lot of futures shorts available, they will act based on the idea that the other side had insider info.
Yes, the psychological effect of shorts disrupts natural supply and demand in any market and causes automatic speculation.
Shorting is awesome. It shouldn't be illegal. If you're allowed to make a financial bet that a companys share price will rise, you should be able to do the opposite
No you fucking dummy. Shorting is part of the price discovery mechanism.
trips of truth
/thread
>If Its possible to invest in a company, I should be able to sabotage that companies ability to raise money by shorting
Dont you see that shorting is destructive? Its destroying a company simply because you dont believe in it. It fucks over all the guys that DO believe in it and it sabotages FREEDOM OF ASSOCIATION of the investors.
What gives you the right to sabotage a company simply because YOU dont believe in it?
see
If you're going to make that argument, you should also extend it to selling as well. Selling your stock or currency fucks over those who DO believe in it.
Maybe you think everything should be like the billion coin where the price only goes up. Shorting is just selling high and buying back low.
You're an idiot. If you're short on a Forex pair, crypto pair, or stock, you especially DON'T want to be holding the underlying commodity. The person who wants to be holding it is the person you're borrowing it from -- that's the person who "trusts" the underlying asset more. You and your lender are essentially at odds over the long term price of any shorted commodity.
Selling is part of the supply and demand mechanics.
Its perfectly fine to sell your product to another person for a market price.
You supported that company for a little while and then transfered that stock to someone else who will continue to hold it instead.
This is very different from shorting.
My main argument is that shorting disrupts supply and demand and the market price. It is very damaging because supply and demand is how the price of anything is determined.
the money ghood tho man i short all day every dat FUCK THE MARKET IM IN IT FOR MYTSELF WHOS WITH ME
You have to accept the fact that shorting doesn't destroy companies, but overvaluation and bad fundamental do. Shorting is good because it makes markets more efficient, i.e. a market is efficient if the prices of assets equal their fundamental value.
no.
if you couldnt short we would just have retards like you pumping everything into infinity and beyond retardation.
>pumping everything into infinity
NO! Supply and demand would balance out naturally!
Shorting just causes volatility, see cryptomarket before and after shorting was allowed.
Jesus fucking christ.
Exactly my fucking point. If I'm shorting something, I'm borrowing it from you to sell it now and buy back to give to you on contract close. Cash settled means I never have to actually borrow it. Fucking tard bus.
Shorting wasn't "allowed" in the first place, but exchanges added margin trading. Your argument that shorting increases volatility is wrong, possibly the exact opposite is true. A smart shorter sells high and buys low, therefore making the price less volatile. See for example:
coinmarketcap.com
coinmarketcap.com
You can short OMG on bitfinex, but you can't short VeChain (at least no market I know of). You can clearly see that Vechain has been much more volatile than OMG, while they have a similar market cap. You can also look at other coins and see the same result.
The Holocaust needs to happen for real
But then you'd know the economic benefit of short contracts you retarded fuck.
Going to have to go with this.
Shorting provides liquidity to any markets and is necessary for hedging reasons. If you take out shorting you will have flash crashes and uncontrolled panics
That's the point. Cash settled or not, if I'm shorting USDJPY I want to be HOLDING JPY and not USD. If I'm shorting LTCBTC I want to be HOLDING BTC and not LTC. The person who wants to be holding it has already put their position into the lending market and is compensated by the fucking compounding interest they could accumulate lending capital every day at a competitive rate. If the rate is too competitive and you don't like the way the market is going -- you could always just sell the underlying asset you already hold. But you don't want to for some reason or another, maybe you don't believe the downtrend is very strong and want to increase your stack without having to risk it by selling it all. Then maybe short contracts are for you, and it's especially important that you don't hold the underlying asset unless you're trying to hedge a position you're already in (i.e. shorting 1ltc in ltc/btc while holding 1 bought in ltc/btc so that you effectively neither gain nor lose money)
It actually provides liquidity
No it should not be banned. Shit companies deserve to be shorted. Over speculated commodities deserve to be shorted. Free markets need to be free or you are USSR 2.0 and you get economic failure
>Free markets need to be free
okay so you're in favor of removing all of the unnecessary regulations like caps on wash-trading, accredited investor certifications, et al, yeah?
because the "free market" as it stands in the US is anything but free.