What’s the purpose that benefits the whole of the economy? I don’t understand it’s purpose other than to bet on a losing stock. Is it purely for hoping a business will fail? Where is the benefit outside of the individual shorting? The idea of shorting a stock seems unmoral and unethical. Basically why is shorting even allowed to be a thing?
In: Economics
You are allowed to transfer your stock to another person. You are allowed to sell stock, and you are allowed to buy stock.
If you own a stock, and I offer to give you $20 and a promise to return the stock in a week, you can loan me the stock. Then I can immediately sell it. And then a week later I can buy an equivalent number of shares and return them to you. You’re $20 richer, and I get to profit the difference between how expensive the stock was last week and how cheap it is today.
Which part of this transaction would you propose could/should be made illegal?
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