Chicago Tribune (07/16/08); Boak, Joshua
The Securities and Exchange Commission (SEC) this week offered an emergency restriction on naked short selling, essentially providing shelter to companies left financially exposed by the housing crisis. Naked short selling entails traders betting that certain stocks will decrease. For the next 30 days, SEC officials will require investors to either own or borrow shares in these companies before finalizing a short sale. SEC Chairman Christopher Cox said that naked short selling combined with the perceived spread of false rumors represents a "witches' brew of dangerous activity" that has imperiled Fannie Mae and Freddie Mac in particular.
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