Northern Rock was so heavily sold by hedge funds yesterday that the stock of shares available for short-selling ran out - the first time this has happened for a UK blue chip, according to several prime brokers and fund managers. Shares in the bank plummeted another 28 per cent to 185.2p as the government said it would not extend its guarantee on deposits to new accounts. The drop followed days of falls as hedge funds piled in to bet the price would drop. Short-selling involves borrowing shares from a long-term holder, such as an insurance company or pension fund, and selling them, paying a fee to "rent" the stock. http://www.ft.com/cms/s/0/f925b222-67da-11dc-8906-0000779fd2ac.html What about a short squeeze ?