More Regional Bank Drama, Short Selling Concerns & The Dangers of EIAs

More Regional Bank Drama & Short Selling Concerns

What a week on Wall Street! The Money Wise guys start the show with a recap of last week’s numbers across the three major indices. The Dow was down 1.2% and the S&P 500 was down 0.8%, while the NASDAQ ended the week up slightly. The Dow is up on the year, as is the S&P and the NASDAQ. We had an attack of the Fridays once again, but a good one this time. It didn’t quite get us back to positive range for the Dow and S&P, but it helped the market overcome considerable drama early in the week due to more regional bank failings, plus the Fed meeting on Wednesday. Many investors are experiencing 2008 fears again and it showed in the market early last week. For example, an exchange-traded fund that contains hundreds of regional banks and it took another kick in the pants due to short selling. The guys discuss why it may be time for a moratorium on short selling, and why regulators should take action.

What is Short Selling?

Short selling occurs when a trader borrows shares of a stock or other asset that they believe will decrease in value, then they sell in the hopes of being able to buy the shares back for far cheaper. Short selling can lead to a lack of confidence in a stock, which is what we’ve seen happening with short selling around several regional banks. You can read more about the pros and cons of short selling here, as well as the moratorium on short selling back in 2008 during the financial crisis and why it was important.

In the second hour, the Money Wise guys share The Dangers of Equity Indexed Annuities (EIAs). You don’t want to miss the details! Tune in for the full discussion on your favorite podcast provider or at davidsoncap.com, where you can also learn more about the Money Wise guys or take advantage of a portfolio review and analysis with Davidson Capital Management.

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