Jonathan
- 18 Sep 2008 18:35
FSA/PN/102/2008
18 September 2008
FSA statement on short positions in financial stocks
The Board of the Financial Services Authority (FSA) today (Thursday 18 September) agreed to introduce new provisions to the Code of Market Conduct to prohibit the active creation or increase of net short positions in publicly quoted financial companies from midnight tonight.
In addition, the FSA will require from Tuesday 23 September daily disclosure of all net short positions in excess of 0.25 per cent of the ordinary share capital of the relevant companies held at market close on the previous working day. Disclosure of such positions held at close on Friday 19 September will also be required on Tuesday 23 September.
The FSA stands ready to extend this approach to other sectors if it judges it to be necessary.
These provisions will remain in force until 16 January 2009, although they will be reviewed after 30 days. A comprehensive review of the rules on short selling will be published in January.
Hector Sants, chief executive of the FSA, said:
While we still regard short-selling as a legitimate investment technique in normal market conditions, the current extreme circumstances have given rise to disorderly markets. As a result, we have taken this decisive action, after careful consideration, to protect the fundamental integrity and quality of markets and to guard against further instability in the financial sector.
The detailed changes to the Code of Market Conduct, and a schedule of the companies whose securities are covered by them, will be published before the market opens tomorrow (Friday 19 September).
NOTES FOR EDITORS
1. The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; securing the appropriate degree of protection for consumers; and fighting financial crime.
2. The FSA aims to promote efficient, orderly and fair markets, help retail consumers achieve a fair deal and improve its business capability and effectiveness.
ENQUIRIES
Press: Kirsty Clay 020 7066 3232
Outside office hours 07795 351 956
Public: FSA Consumer Helpline 0845 606 1234 (call rates may vary)
Website: www.fsa.gov.uk
dealerdear
- 18 Sep 2008 21:46
- 4 of 30
The fact you can't speak or write English means you must be one of them.
banjomick
- 18 Sep 2008 21:47
- 5 of 30
You have to laugh,if shorting contributed to the sharp falls in HBOS surely a shorter would say that HBOS were a doomed company anyway which has been made apparent by the shorting success!
All that has happened is shorters have took advantage of the current climate to their advantage and used this method to it's logical conclusion,if it's there use it!
While we still regard short-selling as a legitimate investment technique in normal market conditions, the current extreme circumstances have given rise to disorderly markets. As a result, we have taken this decisive action" -bollocks,it's only because shorting has maybe been seen to effect a major sector that is going through a bad time anyway and made worse by this method so resulting in a serious knock on effect eg jobs,votes,pensions.......... again,if this method is there then use it!
Never mind the younger AIM companies where smaller volumes can have a dramatic effect when shorted and put unnecessary pressure on the best of them!
Not talking about you,Treble before you jump in :-)
Bullshare
- 18 Sep 2008 21:51
- 6 of 30
List of UK incorporated banks and insurers in connection with SHORT SELLING (NO 2) INSTRUMENT 2008
1 ADMIRAL GROUP PLC
2 ALLIANCE & LEICESTER PLC
3 ALLIANCE TRUST PLC
4 ARBUTHNOT BANKING GROUP PLC
5 AVIVA PLC
6 BARCLAYS PLC
7 BRADFORD & BINGLEY PLC
8 BRIT INSURANCE HOLDINGS PLC
9 CHESNARA PLC
10 EUROPEAN ISLAMIC INVESTMENT BANK PL
11 FRIENDS PROVIDENT PLC
12 HBOS PLC
13 HIGHWAY INSURANCE GROUP PLC
14 HSBC HOLDINGS PLC
15 ISLAMIC BANK OF BRITAIN PLC
16 JUST RETIREMENT HOLDINGS PLC
17 LEGAL & GENERAL GROUP PLC
18 LLOYDS TSB GROUP PLC
19 LONDON SCOTTISH BANK PLC
20 NOVAE GROUP PLC
21 OLD MUTUAL PLC
22 PRUDENTIAL PLC
23 RESOLUTION PLC
24 ROYAL BANK OF SCOTLAND GROUP PLC
25 RSA INSURANCE GROUP PLC
26 ST JAMES'S PLACE PLC
27 STANDARD CHARTERED PLC
28 STANDARD LIFE PLC
29 TAWA PLC
dealerdear
- 18 Sep 2008 21:51
- 7 of 30
banjo, your point is...?
banjomick
- 18 Sep 2008 21:57
- 8 of 30
Evening dealerdear,
It's not a level playing field! Ohhh,you can't short financial stocks,it's just not fair as the sector is going through a bad patch at the moment!..............type thing.
dealerdear
- 18 Sep 2008 22:15
- 9 of 30
Evening.
That isn't the point surely. A cy is defined by it's sp. If the shorters start destroying that then confidence in the cy goes. Investors start pulling their money out and other institutions stop dealing with them 'just in case'. A vicious circle ensues and sure enough the company has to be bailed out. This means that a cy's survival short term at least is in the hands of the shorters which can't be right. A company has to live and die by it's accounts granted, but it was plainly obvious to me that the continual shorting would bring our financial system down within days, for what? So that some can walk away with loads of money and a total disregard for anybody else? The government had to act today to stop the destruction of our system and for that I applaude.
banjomick
- 18 Sep 2008 22:23
- 10 of 30
dealerdear,
I agree and my point is that short selling is deemed as an acceptable way of trading/gambling unless it effects the major players like we have seen!
That's why I say if it's there use it,I don't,as I think in many cases it's morally wrong but that's just my opinion.
spitfire43
- 18 Sep 2008 22:24
- 11 of 30
Dealerdear
Agree with every word, it's not often I agree with anything this Government does, but this time I applaud them.
I guess they had no choice really, we good have seen the financial system destroyed. That's how serious it could have been.
Strawbs
- 18 Sep 2008 22:30
- 12 of 30
Yep. Whilst I think short selling has a purpose, it can't be right to let people wreck the financial system. If people are still sure a companies in a bad way, then they can continue to hold their existing short positions. I suspect others will make it a painful choice though. :-)
In my opinion.
Strawbs.
dealerdear
- 18 Sep 2008 22:33
- 13 of 30
A psychological study of those that seriously short and those that don't would be interesting!
On that point gentlemen, I bid you goodnight as I'm going to need plenty of rest before tomorrow kicks-off. I feel as though I have aged 10 years today!
chocolat
- 18 Sep 2008 22:34
- 14 of 30
Blimey Mick - you and blondie actually agree on something :)
Cor, I must make a note of that.
Treblewide
- 18 Sep 2008 22:36
- 15 of 30
"people wreck the fianancial system"
were bear sterns attacked by shorters? was northern rock? was lehman brohters? erm no...
the governments who allowed this to happen and the directors of the said financial institutions are solely to blame......so the governement are now telling me I cannot hedge a pension position if i wanted to.
we are meant to live in a free market economy......only when it suits the government it seems
deardealer...thanks for your feedback
banjomick
- 18 Sep 2008 22:38
- 16 of 30
lol choc
chocolat
- 18 Sep 2008 22:46
- 17 of 30
And dealerdear - your analogy of a vicious circle is way off the mark - it has been and still remains a vortex. And it was all of their own doing. It's going to take years to realise the true extent of their idiocy.
As ever, the real winners have long since run off with the spoils.
Pyramid selling, take a bow.
Treblewide
- 18 Sep 2008 22:50
- 18 of 30
go on Mick give us a cuddle :-)
banjomick
- 18 Sep 2008 22:52
- 19 of 30
Treble,
You just concentrate on looking after your Gold trades...............
Treblewide
- 18 Sep 2008 22:54
- 20 of 30
aye thanks for the reminder pal :-)
banjomick
- 18 Sep 2008 22:55
- 21 of 30
np
banjomick
- 19 Sep 2008 00:35
- 22 of 30
While I'm in the mood :-)
Lets take Teblewide and MDW:
He has stated that he has shorted them successfully 3 out of 4 times and posts comments like:
"in short 3p by chrimbo and a real chance if they do not get rid of management they will go into receivership.....when they bough the MDT business I said at the time it must have been a bag of shite as they only paid buttons for it.......looks like that was fairly correct......i feel sorry for shareholders"
He has probably used my shares to enable his short positions and then can freely go about telling lies and basically scaremongering,is this right?
Then again he could be just talking bollocks and using the threat of 'shorting' to drop the SP to buy more shares!
The above is just an example (sorry Treble) of how powerful just the shorting word can be!
The idiots who invented this shorting system have said this aids liquidity in the market place have been proven correct,so can't fault them there!
If we take HBOS as an example would the old regime of buy,sell or hold have staved off what has happened?
The rules for shorting were put down and agreed that it was a fair system,it has been proved wrong when it effects the big players but how many young AIM companies whether they have gone down or struggled by this form of trading and just been ignored as they must have been a bad company? So,were HBOS a bad company?Why protect the rest of the financial sector from a trading system that is thought to have merit?Are they all bad too?
I hate,oh yes hate,the BB lies that are told and can get away with but it's part and parcel unless you are a major ot course!
Lets short the UK into destruction as it's legal!-lol
banjomick
- 19 Sep 2008 00:37
- 23 of 30
Sorry for above but just gets my mad up-lol