What is Naked Shorting:

Naked Shorting is the practice of selling short a stock that the Seller has no ability or intention to borrow for delivery to the Buyer. This trade will fail normal trade settlement requirements and will result in additional dilution of your investment. The SEC has identified the perils of dilution and yet they continue to allow Naked Shorting to dilute stocks without any controls to protect investors. The SEC admits this dilution could be greater than 100% of the registered shares in the Company in which you are invested.

 

How Naked Shorting Affects us all:

 Naked Shorting creates an imbalance between normal supply and demand and will depress any security being abused by the overselling of its stock. The loss in market capitalization results in less money available to support economic growth through consumer spending. The profits of naked shorting for the short seller, is far less than the losses those shareholders suffer due to the drop in market capitalization. This is an overall net loss to our economic stimulus.

More importantly however, Naked Shorting steals some of the greatest ideas, products, and services in America. Small Micro-Cap companies are driven out of Business by this abuse and we are left with the unknowns of what these companies and their employees had to offer our futures. The opportunities for the next Microsoft may never be felt as naked shorting snuffed out that creativity before it was ever brought to fruition. Ultimately, Naked Shorting steals from the very foundation of our Nation as it steals the American Dream of Opportunity.