The German government announced plans to ban naked short-selling at the country's 10 most important financial institutions on Tuesday. Bill Spiropoulos, CEO of CoreStates Capital Advisors, shared his insights on the new proposal.
“Naked short-selling is wrong and it takes the marketplace and turns it into a casino,” Spiropoulos told CNBC.
“When you see stocks get blasted with flash trading, it destroys the entire confidence in markets. And the roller coaster activity makes people run to the sidelines and they have no interest whatsoever in investing,” he said.
Spiropoulos proposed that there should be a “cooling mechanism” that takes place when markets become extreme or highly charged.
“What happened during the flash crash, that’s what I mean by creating a casino atmosphere,” he said. “You ruin the capital formation process—there’s a consequence for that and I think stability and fairness is what marketplaces have to have.”
- Watch Spiropoulos' Previous CNBC Appearance (Apr.16, 2010)
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- Why Germany's Naked Short Ban Is 'Reasonable': Strategist
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Thursday's Top Dow Laggards (as of this writing):
No immediate information was available for Spiropoulos or his firm.
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