Affiliation:
1. Federal Reserve Bank of Cleveland
Abstract
Some observers have argued that the short selling of bank stock contributes to bank runs and bank failures. Previously, no evidence has been available. We find no evidence that more short selling of bank stock is associated with materially larger outflows of bank deposits. We believe this means that proposals to restrict the short selling of bank stock should be supported by other arguments.
Publisher
Federal Reserve Bank of Cleveland
Reference18 articles.
1. 1. Asquith, P., and Meulbroek, L., 1995. An Empirical Investigation of Short Interest. Unpublished working paper. https://books.google.com/books?id=gP7UtgAACAAJ
2. 2. Battalio, Robert, 2023, "Short Selling and the Regional Bank Crisis," Promarket, July 6. https://www.promarket.org/2023/07/06/short-selling-and-the-regional-bank-crisis/
3. 3. Beber, Alessandro, and Marco Pagano, 2013, "Short-Selling Bans Around the World: Evidence from the 2007-09 Crisis," Journal of Finance 68:1, 343-381. https://doi.org/10.1111/j.1540-6261.2012.01802.x
4. 4. Beber, Alessandro, Daniela Fabbri, Marco Pagano, and Saverio Simonelli, 2021, "Short-Selling Bans and Bank Stability," The Review of Corporate Finance Studies 10, 158-187. https://doi.org/10.1093/rcfs/cfaa022
5. 5. Beneish, M.D., C.M.C. Lee, and D.C. Nichols, 2015, "In Short Supply: Short-sellers and Stock Returns," Journal of Accounting and Economics 60:2-3, 33-57. https://doi.org/10.1016/j.jacceco.2015.08.001