Naked Short Selling Facebook

I saw an interesting fallacy.  The author said “You can’t short sell Facebook.  After an IPO, there are no shares available to borrow, preventing short selling.”

That is false.  It is perfectly legal to naked short sell Facebook.

A pro-State troll says “No!  Naked short selling is illegal!”  It is illegal, but not enforced.  If something is illegal, but there’s no enforcement, then it’s legal.

The SEC is supposed to police stock fraud, including naked short selling.  However, the actual trade records are not given to the SEC.

At one of my wage slave financial software engineer jobs, I looked at their database.  They had records for naked short selling.  For a “hot IPO” like Facebook, the naked short selling can reach 100% of a day’s volume, or more!

How does a bankster profit naked short selling Facebook?  Facebook is way overpriced, due to hype and the investment bankers propping up the IPO.  The bankster naked short sells Facebook.  In 3-6 months, pre-IPO share lockup agreements expire, and insiders may start selling, pushing down the price further.  The naked short seller waits 3-6 months to cover his short, profiting from the hype.

The naked short seller counterfeits shares of Facebook.  He sells them to gullible people who buy the IPO hype.  The naked short seller waits a few months and then covers.

The average person cannot naked short sell.  Your broker won’t let you.  Only banksters and insiders may naked short sell.  The stock clearing and settlement system covers up naked short selling, treating fails as equivalent to legitimate trades.

Naked short selling robs stupid people who buy a “hot IPO”.  The naked short seller is counterfeiting.  A regular counterfeiter makes fake State paper money.  A naked short seller counterfeits shares of stock and sell them.

There probably is a ton of naked short selling in Facebook.  It could be 100% of the daily volume or more.  The SEC can’t do anything about it, because they don’t have the records.  Even if they did, like Bernard Madoff, the banksters would use their connections to prevent an honest investigation.

7 Responses to Naked Short Selling Facebook

  1. Actually, naked short selling is NOT illegal in the US. Manipulative naked short selling is illegal – and the SEC has to decide to investigate if it’s manipulative. Slightly different, but that’s the case.

    I know because I own a stock (Silvercorp metals – stock symbol : SVM) which has been probably naked short sold (ie: I don’t trust the actual short interest numbers) and the subject of a Short-And-Distort scheme.

    Silvercorp is suing the relevant parties (ie:bastards) – and I (as a shareholder) hope they succeed! (If they do, I stand to make some money.) (Oh, and I don’t know if the SEC will actually do anything, but there is at least a investigations by the FBI and Canadian police, and a civil case going on in NY courts).

  2. BTW: here’s the link about how naked short selling is LEGAL

    http://www.sec.gov/spotlight/keyregshoissues.htm

    “Naked short selling is not necessarily a violation of the federal securities laws or the Commission’s rules. Indeed, in certain circumstances, naked short selling contributes to market liquidity. ….”

    so – yea, you should be able to naked short sell Facebook all you want – as long as it’s not “Manipulative”

    • If the total naked short selling equals 50% or 100% of one day’s volume, that is manipulating the market.

      Research Overstock. They tried to sue regarding naked short selling and lost, even though they had a valid claim.

      The bottom line is that banksters own the government. Don’t expect justice. The stock market is rigged.

  3. Anonymous Coward May 26, 2012 at 7:45 pm

    Are you the same Tony that I’ve seen talking about Endeavour Silver and Canarc on Yahoo Finance?

  4. Short selling is done in a type 3 account which involves margin. Stocks are not marginable until 30 days after IPO. Therefore it is impossible to short sell stock until 30 days after IPO. What players do is to intra-day sell short, and cover on the same day to cover the sale.

    • That is the rule for retail customers and small fry.

      The rules for big banks are different. They can naked short sell and fail to deliver.

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>