No doubt they should do that if they feel it will benefit them. They should not however, go on TV pounding the table about "prederatory short selling" when they do not have evidence of it. That is rumor mongering to the long side and is illegal I believe.
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Tell me can you feel it? The heat is on, on the street Inside your head, on every beat And the beat's so loud, deep inside The pressure's high, just to stay alive 'Cause the heat is on Oh-wo-ho, oh-wo-ho Caught up in the action I've been looking out for you Oh-wo-ho, oh-wo-ho (Tell me can you feel it) (Tell me can you feel it) (Tell me can you feel it) The heat is on, the heat is on, the heat is on the heat is on Oh it's on the street , the heat is - on Oh-wo-ho, oh-wo-ho Caught up in the action I've been looking out for you Oh-wo-ho, oh-wo-ho (Tell me can you feel it) (Tell me can you feel it) (Tell me can you feel it) The heat is on, the heat is on, the heat is on Oh it's on the street , the heat is - on The shadows are on the darker side Behind those doors, it's a wilder ride You can make a break, you can win or lose That's a chance you take, when the heat's on you When the heat is on Oh-wo-ho, oh-wo-ho Caught up in the action I've been looking out for you Oh-wo-ho, oh-wo-ho (Tell me can you feel it) (Tell me can you feel it) (Tell me can you feel it) The heat is on, the heat is on, the heat is on It's on the street The heat is on, the heat is on, the heat is on Yeah it's on the street The heat is on
Well, prederatory short selling is true to some people but not true to other people. Right now, people who write credit default swap (Think MS and GS ) will need to put up additional capital if their stock fall to certain level or their credit rating get downgrade. After Paulson's bail out of AIG, the prefer share, bond market, straight up borrowing is closed for MS and GS. That leaves a straight selling of their asset open only. Hence, the rumor of MS and citic bank. So, if you trigger these clauses in CDS, MS and GS will need to deplete their cash. If someone start rumors about them losing their cash, their clients will want their cash back too. IE. That's how a perfectly ok investment back goes BK. Anyway, check out this link and decide for yourself. http://www.youtube.com/watch?v=dDd51v7prtI
So, the question I have is why would a perfectly sound and rational company create instruments that are pretty much ticking time bombs if the company's stock price falls below a certain point? Jesus F#$@ing Christ man: DID ANYONE LEARN ANYTHING FROM THE FALL OF ENRON???
They are not ticking time bombs unless you come into a financial environment that is under the greatest stress since the Great Depression.