Markets

DAVID EINHORN on SEC and short-sellers

David Einhorn, founder of the $6bn Greenlight Capital fund and author of "Fooling Some of the People All of the Time, a Long Short Story", says the recent decision by the Securities and Exchange Commission to curb naked short-selling on 19 financial stocks was "a rather peculiar action". He thinks the move could make short-selling a bit more costly. Mr Einhorn, who chronicles his experience of shorting Allied Capital in his book, says the focus on short-sellers, who are being blamed by some commentators as causing financial shares to fall, reflects a common need to blame someone. "I talk about this a lot in my book where when somebody isn't able to deal with their real problems, sometimes they want to talk about something else. It's not like the short sellers caused the financial institutions to be over levered, under capitalized, engage in bad lending practices and bad investment practices and bad risk management practices. It is a little bit peculiar to spend time on this, but the reason people want to focus on this is they have an interest in not focusing on those other things."