Wednesday, July 16, 2008

WSJ Frontpage Coverage of Nothing

Given the near useless changes in naked short-selling rules announced by SEC Chairman Chris Cox, it is quite remarkable to see this front page headline from WSJ:

SEC Moves to Curb Short-Selling

The SEC didn't move to curb short-selling. As we explained, yesterday, it made a small technical change to its naked short-selling rules, which should have about as much impact on market activity as the impact of my eating a donut would have on global warming.

Apparently, WSJ staffers are taking to heart Rupert Murdoch's order to come up with headlines that sell newspapers, damn the truth.

Then, of course, Chris Cox must be a good source for WSJ staffers, since the ridiculousness doesn't stop with the headline. Get a load of these breathless WSJ lead paragraphs for an essentially useless change in naked short selling rules:

The Securities and Exchange Commission took unprecedented action against short sellers on Tuesday, acting on a widespread concern that negative bets against bank and brokerage stocks might be exacerbating the financial sector's woes.

In a dramatic emergency order, the SEC said it would immediately move to curb improper short selling in the stocks of struggling mortgage giants Fannie Mae and Freddie Mac, as well as those of 17 financial firms, including Goldman Sachs Group Inc., Lehman Brothers Holdings Inc., Morgan Stanley and Merrill Lynch & Co...

The actions represent one of the most extensive attempts by a government agency in recent years to control short selling.

Is WSJ serious? "Dramatic emergency order"? Useless emergency order is more like t.

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