In accordance with President George W. Bush’s Emergency Economic Stabilization Act, the temporary ban on short-selling expired today.
The SEC enacted the ban last month, as critics pointed to short selling as the cause of financial firm meltdowns. Most of the other major exchanges followed suit, banning the practice either temporarily or – in some cases – indefinitely.
As Wall Street opened this morning, the resumption of short selling pushed Morgan Stanley stock down 25%, according to Bloomberg.