Wall Street Short Sellers: Hated For Centuries

Wall Street "short sellers" are often cast as villains. They make money when most others are losing it — that is, when stock prices fall.

In recent weeks they were painted as the enemy again, when hedge funds made bets that prices would fall for several so-called "meme stocks" like GameStop and AMC. These bets drew the attention and ire of small investors, setting off a tug of war between the two sides.

This is nothing new. Shares of the very first stock ever created — the Dutch East India Company in the early 1600s — were soon shorted by an investor who didn't like the fundamentals, and who was pilloried for his views.

A great many more public companies and some 300-odd years later, President Herbert Hoover railed against short sellers after the market crash of 1929. In several speeches and public statements, Hoover and his allies denounced "bear raids" by groups of short sellers contributing to national distress "with purpose to profit from depreciation of securities and commodities."