Economics Update

Wekk, retail gasoline has finally dropped below $4.00 per gallon, the first time in almost two months, oil moved very little, depending on grade, somewhere between ±$0.15/bbl.

Meanwhile, Nouriel Roubini is arguing that foreign central banks and sovereign wealth funds are increasingly less willing to take huge losses in order to bail the USA's financial system out, and that this will lead to a systemic collapse, with, "ensuing fall of the U.S. will make this fire sale of the best U.S. private asset a true bargain basement deal: with the dollar price of these assets now imploding and with the U.S. dollar now in free fall non-residents will be able to buy most of U.S. Inc. for the cheapest bargain."

One final note, and some information that shocked me, is the amount which short sales decreased in financial stocks as a result of the new SEC rules banning "naked" short selling: 98%.

S3 Matching Technologies is reporting that short sales in the newly regulated stocks fell by a factor of 50, which is far more than I would have expected.

Even if some of the decline in short sales was investors who were spooked by the new rules, it's clear that the overwhelming number of short sellers are engaging in "naked" shorting.