Wednesday, 17 September 2008

how to short the market

bear market
It looks as if the traders are still finding ways to make a turn even during the demise of once famous financial institutions.

It's easy really, borrow something you don't have. Sell the thing you've borrowed. Wait for it to devalue because of the market conditions. Buy it back with the money made when it was sold. Hand it back to the person who loaned it and pocket the difference in value.

Its called shorting, and there's a lot of it about.

It can bring down banks. Or governments.

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