1115.org

Securities covered by SEC short sale order - Reuters (7/15/08):

The U.S. Securities and Exchange Commission issued an emergency order on Tuesday placing restrictions on the short selling of shares of certain major financial firms.

The SEC’s order will require that anyone effecting a short sale in these securities arrange beforehand to borrow the securities and deliver them at settlement.

The order takes effect Monday, July 21, and will terminate at the end of July 29. The SEC said the order may be extended, but for no more than 30 calendar days in total duration.

The agency identified the following securities affected by its order:

* BNP Paribas Securities Corp
* Bank of America Corp
* Barclays PLC
* Citigroup Inc
* Credit Suisse Group
* Daiwa Securities Group Inc
* Deutsche Bank Group AG
* Allianz SE
* Goldman Sachs Group Inc
* Royal Bank ADS
* HSBC Holdings Plc ADS
* JPMorgan Chase & Co
* Lehman Brothers Holdings Inc
* Merrill Lynch & Co Inc
* Mizuho Financial Group Inc
* Morgan Stanley
* UBS AG
* Freddie Mac
* Fannie Mae

A bit more color from the Wall Street Journal:

SEC Chairman Christopher Cox acknowledged that the crackdown will create additional work for brokerage firms, though he said he sees “no obstacles to implementation.” Agency officials delayed the effective date of the stricter short-selling requirements to “provide appropriate operational relief to the exchanges,” he added.
[…]
While there wasn’t an increase in naked short selling ahead of the emergency action, [SEC Chairman Christopher] Cox said the move was “prophylactic” to “remove tools of mischief so that markets can operate efficiently.” The 19 companies on the protected list are the same ones that have access to the Federal Reserve’s lending facility, he noted.

What does additional work have to do with operating efficiently?

Funny, the way I learned it there’s nothing more efficient than a free market which includes buyers and sellers. But now the alpha dog masters of the universe at houses like Goldman and Merril need their stock protected by the government? Forget shorting, the real moneymaker would be to drive to New York City and start buying up all the Viagra you can get your hands on. An epic wave of shriveling must be taking hold right about now. Nullus.

What’s next? No put options on odd-numbered days? Stop-loss orders only on Tuesdays and Thursdays? IPOs prices must be divisible by seven or nine?

Who is in charge here, General Esposito?

From Woody Allen’s Bananas (1971):

Esposito: From this day on, the official language of San Marcos will be Swedish. Silence! In addition to that, all citizens will be required to change their underwear every half-hour. Underwear will be worn on the outside so we can check. Furthermore, all children under 16 years old are now… 16 years old!

Fielding Mellish: What’s the Spanish word for straitjacket?