Some of the same greedy monkeys of Wall Street that had the depression-era Glass Steagall ,a.k.a. The Banking Act of 1935 , repealed in 1999 which is the reason banks are in trouble today had another key piece of depression-era market abuse legislation rolled back in 2007. The "short sale uptick rule " was eliminated.
Simply ,short sales of stocks by speculators had to be executed at a higher price than the last sale or equal to the last sale if was a higher price. This uptick rule was part of the The Securities Act Of 1934. The legislation created the Securities And Exchange Commission. The rule was put in place to stop bear raids by individuals and/or groups that drove down stocks causing margin calls and in some cases bankrupticies of the targeted company. Joe Kennedy of the infamous/famous Kennedy family was notorious for this tactic. So much so that Roosevelt appointed Kennedy as the first S.E.C. Commisioner . Joe basically wrote the outline for The Securities Act Of 1934 because he knew how best to steal in those unregulated markets and FDR wanted Kennedy to write legislation to stop stock market abuses!
Well Lehman Brothers is down 10% today at $38.00. It's down fro a high of $80.00 about a year ago. The rumors on the Street is that hedge and/or hedge funds are spreading rumors about Lehman's ability to remain solvent. At the same time the hedge funds are selling short Lehman stock on downticks whish is now legal.
It's the same tactic that was used so efffectively to drive Bear Stearns out of business and into a Federal bailout and acquired by J P Morgan Chase. Bear Stearns stock went from a 52 week high of $170.00 to an acquistion price of $10.00 per share. So if Lehman goes down who's next?
Now if the hard learned lessons and legislation of the depression era were just left in place, then most of this market turmoil would not be happening. But of course then we would be dealing with a monkey/primate with real intelligence and not a frivolous primate wearing a three-piece suit.
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