Stock Market Crisis: Four European Countries Prohibit Short Sales. The week ends on a strong growth in European stock exchanges. Over 4% in Paris, 3% in London and 5% in Madrid. The origin of this rally, the announcement of measures on the part of several countries to curb speculation, the prohibition of short selling, it is selling securities that one does not. But the subject is not consensus among the leaders of the euro area.
Since 12 August, short sales are prohibited in France, Italy, Spain and Belgium, but only for 15 days and the shares of banks and insurance, the more heckled in the last days only.
This initiative was welcomed by the Germany which already applies this ban for a year to all of the values listed, financial or not. Berlin calls for an extension of this measure to Europe in the fight against destructive speculation that destabilize markets.
But the British are not at all considering regulation full or even partial short sales that represent a significant part of the activities of the City. Same reluctance to the Netherlands.
The European Commission has proposed to limit these short sales already implicated for their harm during the crisis of 2008. An agreement seems to more transparency and monitoring of these operations, but it will be as definitive as the current German practice any.
The Germany welcomes the decision to ban short sales
Our correspondent in Berlin, Pascal Thibault
Fifteen months ago, Berlin had taken the lead and decided to prohibit certain short sales. The measure had then decried by partners of the Germany denouncing an action taken without consultation. A measure the relative effects because markets globalized, only global decisions can be followed to effect.
Berlin was not left impressed by critics and had then extended a measure – initially to a dozen of the Frankfurt Stock Exchange securities, all of the shares traded in Germany. The law passed in July 2010 is still valid.
Berlin has beautiful game today welcomed the decision of four European countries to temporarily ban short sales. The German Ministry of Finance also goes further and argues for a ban on the whole of Europe and to counteract the destructive speculation convincingly.
The Federation of German private banks found that distinct national measures were acceptable on a temporary basis. The Organization advocates for reasonable European rules.