Flagrant Market Manipulation

SEC Press Release Friday September 19, 2008: "SEC Halts Short Selling of Financial Stocks to Protect Investors and Markets; Commission Also Takes Steps to Increase Market Transparency and Liquidity" How does banning short selling increase liquidity? That would be 799 financial stocks, btw. SEC to market makers: never mind, short away!

SEC Press Release Sunday September 21, 2008: "Statement of SEC Division of Trading and Markets Regarding Technical Amendments to Short Sale Order"--

...However, this exception now requires that, for new positions, a market maker may not sell short if the market maker knows a customer or counterparty is increasing an economic net short position in the shares of the Included Financial Firm.

In effect, they're not allowing investors to buy puts.

Doubtless entirely of its own volition--

The SEC has delegated to each national securities exchange the authority to identify additional listed companies that qualify for inclusion in the list of companies covered by the revised prohibition.

--, the New York Stock Exchange has added 31 companies to its do-not-short list, including major foreign banks, General Motors, and the icon General Electric.

Such flailing around does not increase my confidence in the powers-that-be. If things are really serious, they should close the market and coordinate a coherent response.