2008 REPLAY: Europe Moves To Ban Short Selling As Crisis Spreads

http://www.businessinsider.com/europe-short-selling-ban-2011-8

In 2008, several countries banned short-selling in an ultimately impotent attempt to control the crisis, but not everyone thinks a blanket ban works however. Analysts argue that it hasn't worked in the past, because it singles out a group that may not have been that active during the trades, and because it won't prevent panicked investors from selling their shares.

“Every time we have had a short selling ban, the sector it is supposed to protect has collapsed,” one hedge funder told the FT, adding that the measure seemed designed to stop hedge funds make money rather than stopping a collapse.