Nikkei Opens Higher On Wednesday

Reuters: Nikkei leaps 3.4 pct as Citi news lifts bank shares

A little it more on the "uptick rule" -

The rule's original intent was to restrict short-selling in a declining market....Without the rule, short-sellers can drive prices down in times of uncertainty and effect greater price declines than might ordinarily occur.

The rule was designed essentially as a market-stabilizing feature and added greater certainty to the markets. Stability adds confidence, confidence attracts buyers. Less stability and confidence are generally not good as they tend to drive the rational decision-making process into an irrational one.

The net effect is greater market price swings, i.e. volatility. In times of more significant uncertainty (such as we have now), where it is going to take a while to sort out the woes of the credit and subprime mortgage markets, we are destined to get more significant price swings, much more so than we would have if the so-called Uptick Rule had not been removed.

The Uptick Rule has had particular effect (and potential opportunity) on the stocks that people have been most eager to short. It's these shorts, unleashed by the abolition of the Uptick Rule, that could become most vulnerable to a squeeze. source

I believe that there needs to be some very serious investigation of this change that occurred in 2007, when the SEC eliminated the "uptick rule." If you want to identify who is profiting from this recession and how they are profiting, this is the door.

Market Watch: Bernanke: Uptick rule might have been useful during crisis

Robert Brusca, chief economist at FAO Economics, said too many people on Wall Street were able to make profits from the pessimism in markets and restoration of the up-tick rule was needed.