Uptick rule is on the way back

The uptick rule was put in place during the great depression and was removed in July of 2007. It is now being revisited and hopefully will be re-instated by the Securities & Exchange Commission. The rule requires all short sales to follow an uptick in stock price. This has the effect of slowing down market slides. Since July 2007 when this rule was eliminated shortsellers could drive stocks down by selling while the stock slides. This amounts to piling on. Many examples of this have occurred lately when a company misses estimates by a small percentage and the stock tanks 20% or more the next day. This is a regulation that has stood for around 70 years and it’s removal for the past 20 months may have helped the market crash to where we are now. Click here for article in Fortune Magazine. Market purists who hate any regulation will wiggle & squirm but this rule is both sensible and responsible.