The stock market plunged 1,190 points on Thursday after falling 2,000 points earlier this week.

Bad actors are using the Coronavirus news to try to cause a market panic.

They are making a killing by short selling, and they are going to tank the Trump economy.

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To Stop the Current Short Sale Attack on the Stock Market President Trump Must Reinstate the Uptick Rule

President Trump needs to reinstate the uptick rule to stop the short seller attack on the market. The uptick rule worked great from 1938 to 2007. The current modified uptick rule in place since 2010 doesn’t work. Reinstate the uptick rule and stop the short seller attack.

The Uptick Rule in place from 1938 to 2007 prevented a short sale of a stock unless the previous trade caused an increase in price (an “uptick”). It was put in place by the Securities and Exchange Act of 1934 in response to the stock market crash in the Great Depression to prevent future attacks on the market by short sellers.

The rule was eliminated by the SEC in 2007, and the market crash of 2008-09, which was in part a short seller attack, followed almost immediately. The resulting crash absolutely helped Democrats win in a landslide in 2008.

In response, the SEC introduced the “Alternative Uptick Rule” (Rule 201) in 2010, “which imposes restrictions on short selling only when a stock has triggered a circuit breaker by experiencing a price decline of at least 10 percent in one day.”

(emphasis added)

In the current market decline, individual stocks are falling less than 10% each day, so they are not triggering the short selling uptick restriction. Stocks are declining 2%, 3%, 4% or 5% each day for several days in a row, but not 10% in one day, so the short seller attack on the market can continue.

The modified uptick rule only kicks in after a stock has fallen 10% in a single day. That doesn’t work. Stocks are falling 2% to 5% per day for consecutive days and so are not triggering the uptick restriction.

Reinstate the old uptick rule, and the short sellers will not longer be able to attack the market and cause the dramatic declines we have been seeing.