Rep Barney Franks comment that he had spoken with the Mary Shapiro, head of the FTC. He said he thought that the uptick rule would be returned by the end of the month. The uptick rule was one of many regulations initiated in the 1930's to provide stability to the stock markets. It was one of the rules eliminated by the anti government crowd that surround George Bush and led to the disaster we are facing economically in the US and world today.
The uptick rule, requires a person who sells a stock short to wait until their is an uptick, an increase in market price before they can buy. This serves to prevent a cascading descent where one short sale generates another driving stock prices down and creating a feeding frenzy of negativity.
The news seemed to set of a positive buying spree on today's markets which have been seriously oversold. If and when the rule change takes effect it will probably have a less significant effect, but will once again add stability to the market.
The underlying message is that some regulations are in fact healthy for the market. And those who championed the notion that all government regulation was evil were wrong.
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