The Economics of Naked Short Selling
Christopher Culp and J. B. Heaton
Despite the cries of alarm, we believe that naked short selling
is unlikely to have significant detrimental effects on capital markets.
In this article, we will first examine the relevant economics
and regulation, and then argue that, from an economic perspective,
naked shorting is little different from traditional shorting.
PDF (6 Pages): Paper Economics of Naked Short Selling
Editors Note: This publication embraces naked short selling as both legal and useful. CATO is funded by fake Libertarians such as the Koch Brothers who believe that Libertarians is about allowing them to shit in everyone’s punch bowl without interference. These two authors are probably not stupid — we therefore speculate they have been incentivized to argue against the truth and against the public interest.