lowman, I don't see the answer as eliminating ALL shorts. I just don't see that being possible. It is the MM job to create a market on a low volume stock or any stock for that matter. What needs to change is they need to be held accountable for their decisions in what they decide to do just as you or I in our trades. If they think the damn stock is going to go up then instead of shorting it to "make the shares" they don't have they should RAISE THE PRICE to slow the buying pressure and increase the selling. That would be one heck of a concept, eh? LOL!
If I decide to short Microsoft using money in my account and the share price starts going UP, I can chose to cut my loses and cover or I can decide to just hold because it is MY money that I'm playing with. However, if I decide to short Microsoft using my margin account and the share price starts going up, I might get a margin call and be FORCED to sell at a loss. The above is EXACTLY how it should work for a MM. If they want to take their chances and hold a short hoping for it to recover at some point then they need to actually have the REAL stock in their possession and not have printed fake air shares for which they decide to hold indefinitely at absolutely ZERO cost to them. If they choose to NOT use their own money and create air shares so to speak then at the end of the 3 or 5 day period (whatever it is) they should be forced to cover even if they are losing money... just as you or I would have to do.
IF the MMs were forced to follow rules at least similar to the rules investors have to follow (as I mention above) then LEGAL shorting works just fine and would be good and healthy for the pink sheet market IMO. If they want to short HMGP then fine, have it at. BUT, if they are wrong in their decision then they need to pay for their mistake just as you or I would have to pay for ours. Make them accountable for their actions/trades and shorting would work just fine IMO :)
