If the government wants to make some money, which they obviously do and need to do, why not tax 50% of the difference between the original sold price and the re-buy in profit price in FTSE & AIM? It would clamp down on this ridiculous practise (which isn't open to the public) and calm volatility.

Alistair Kipling, Birmingham,

i really can't see what benefit short-selling brings apart from earning a small number of hedge fund managers a larger bonus. markets should be for the benefit of the wider society and unless a particular trading practice is in the wider interest it should be banned.

stephen, china, china

David (London), when you buy an out of stock product on Amazon and pay upfront only to be delivered a month later when they take delivery, do you consider this to be unregulated and unrestricted short selling?

Amil, London, UK

It's also thought US funds are pulling out of UK shares on a big scale - maybe they now see that the London exchange is inadequately regulated and prefer better regulated markets not at the mercy of short-sellers, insiders, private equity etc.

People are sent to jail in the US for market abuse!

David, London,

Not being a banker or an economist or even educated in those fields - I am just a 'customer' - isn't it time that organisations stopped playing with money as if it were a game of Monopoly?

Why can’t banks and building societies just lend money on what they have on deposit as was the case in the ‘old days’?

Alan, Llanerchymedd, Wales

If, as a holder, you knew you could sell say 30% of your shares at 495p and buy them all back at 275p - wouldn't that turn you into a little shorter. After all HBOS is looking for over 50% more shares, the price is bound to fall. I don't know what peeps expect?!

dan, dorset, uk

B & B have been hung out with the washing mate>>>>>

Derek Clifton, Andover, Hampshire, England

Bill - they also don't know it will be worth far less

they may think its going to go up in value when they lend it

tim, London,

To Tom Porter...

Yes, but would you lend someone a tenner in return for a 50p charge then and the aim of getting a fiver back later? Anyone who has lent out HBOS, housebuilders etc. in the last week has more or less done just that. Pension funds should not be doing this!

Andy Myles, Edinburgh,

As always in the markets, it's either too far up or too far down! 2x earnings for HBOS?? This is bargain of the century! Once the market picks up and/or bid comes in the underwriters will pick up a rather nice profit on their 4bn.. 'We'll write you if you depress the shares and give us a win/win!'

Kv, London,

"Shares in RBS, which successfully raised £12 billion last Friday at 200p, sank 9 per cent to 212.25p yesterday, falling lower than at any time during its fund-raising period."

Did this chap go to the same school of economics as the bankers? Or the Blair/Brown government?

Jay Tee, Oxford, UK

Bank of Scotland worked well for about 300 years when they were just a boring old bank with a funny old constitution. The Halifax was hugely successful as a dull old building society Then they started to be clever........

Frank Upton, Solihull,

David :

Without doubt your comments are correct. The markets must be cleaned up by the authorities responsible.They presently represent the unacceptable face of capitalism & are no longer a place for the small investor.

Malcolm, Neston, United Kingdom

Short selling is not an easy money spinner - plenty lose money when the share price continues to rise. Equally if you think a stock is worth holding long term there are three good reasons to lend it out to a short seller - you make the fee, you get them back and you can buy more if the price falls.

Huw Sayer, Norwich, England

Tom Porter, can you explain further. Although the lenders get the shares back surely they are worth less, also what happens if the borrower goes broke and can't pay them back?

Glen, Melbourne, Australia

All the gleeful lefties who glibly link HBOS to the death knell of capitalism, of course capitalism doesn’t work, it just doesn’t work as badly as all the other -isms don’t work. I shouldn’t have to point that out, you know.

Bill, Sydney, Australia

Bill Peter (Above), long term holders of shares, say Pension & Insurance Funds, will sometimes lend shares to be sold short because they can make money on the shares. i.e. they charge a fee for lending and their overall portfolio is not affected as they know they will get the shares back. Thats Why

Tom Porter, Singapore, Singapore

Who on earth would lend a share to a short seller knowing it will be worth far less when they get it back?

Bill Peter, Kuala Lumpur, Malaysia

When will this useless Government and FSA do something about unrestricted short selling and regulate it effectively. On such a scale it is market abuse. It will be interesting to see the extent of pension fund deficits when announced - so much value has been destroyed.

David, London,

Through your "comments" column I have asked time and again which banks have borrowed how much in return for what grade of security from the BofE.
It's time the public were made privy to these liabilities.

A.Williams, Stafford,

HBOS now valued at 9.7 billion profits last year 5.5 billion this year forecast profits 4.4 billion,this is looking like the bottom get ready for the upswing a bid for one of the big banks is not far away...................................

oliver, chichester, uk

So much for Scottish prudence...................

Peter, Bristol, England

Are we still absolutely certain that capitalism works?

Tom Perry, Singapore, Singapore

It is out of control - lost its rider, didn't you know that?

R Carolus, Kano,

Why are Lloyds TSB being hit so hard ?

Dene, Cardiff, Wales