upndown, you make some good points, however, here is why I believe shorting should be illegal. Weather or not only shares that have been bought on margin can be shorted, I am not sure, but regardless, I see it as being no different than someone borrowing money from a broker to buy a house, so lets say the broker really owns the house until said loan is paid in full, in the shorting world the the broker would be able to lend my house to anyone who wants to borrow it and sell it to someone else at todays market value with a timeline to buy it back at some point and return it to the broker. All without me knowing about it, and the bet is that the housing market will go down in the meantime so when the short seller of my house has to buy it back he pays much less. This could be applied to anything that is bought and sold and I don't think its legal in any other business transactions except stocks as far as I know. Stocks are no different than any other asset. Lets ask the politicians to make shorting open to everything LOL I bet that would go over real well with the rest of the population! I would be willing to bet that 99% of folks have no idea what stock shorting really is, including lawyers and politicians! Make that 99.9%!