There has been a huge media outcry that short selling is a major reason for the economic crisis. Worryingly people in the industry have bought this message and many firmly believe that short selling is one of the market’s evils. Sadly this view, although
popular, demonstrates the ignorance of the reality of the benefits that short selling brings to the market.
As a Jobber a long time ago I lived and breathed short selling and why the ability to go a Bear is fundamental to the ability of the sell side of the market to trade. The lost fact is, it is just as important to the buy side that firms are willing to take
the risk of going short. Yes, the greatest risk is taken by the sell side not as per the popular myth, the buy side.
For the first time the City will have an opportunity to tackle short selling arguments, both pro and con in an open debate. The next
Post Trade Forum, hosted by the London Stock Exchange, on the morning of the 22nd February, delves into this emotive topic.
The keynote address will be given by Anthony Belchambers, CEO of the Futures and Options Association. Anthony is a well know figure in the Industry, who also co-founded the European Parliamentary Financial Services Forum and initiated the establishment of
the UK's Associate Parliamentary Group on Wholesale Financial Markets and Services and the EU-US Coalition on Financial Regulation.
The panel for this debate also includes the Rt. Hon Lord Nigel Vinson, LVO, DL who has had a long, varied and distinguished career. He was a Director of Barclays Bank in the 80’s and Deputy Chairman of Electra Investment Trust in the 90’s and is Life Vice
President of the Institute of Economic Affairs and an active participant in the House of Lords. Joining them is the Rt. Hon Frank Field MP who introduced a private members bill to ban short selling in 2009 and is a member of the All-Party Parliamentary Group
on Economics, Money and Banking and Nicolas Bertrand, Head of Equity & Derivatives Markets, LSEG.
The debate will also no doubt venture into the increasing trend of political intervention in the markets. This too is a double edge sword and at best creates a non-free market where intervention from external sources however well-intentioned, creates a false
market. If you or I did this the regulators would be all over us and prison a likely result. For politicians its different, they can play a moral card and plead that is for the good of the tax payer. Is it?
A debate on short selling is badly needed and it’s hoped that a lively audience will take part to discuss the pros and cons in a clear and forthright manner. Steering the political debate away from market bashing to reasoned understanding and perhaps a route
where regulations and market structure can allow short selling without external manipulation however well intentioned.