"Outlawing short-selling is a mistake," said Barry Ritholz, chief executive and director of equity research at Fusion IQ and author of "Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy."
"If you go back over the last few decades, every major fraud [Enron and WorldCom] has been uncovered by short-sellers," he said.
Ritholz thinks the U.S. looks at European markets' problems "as an excuse for something that was due to happen anyway." He believes the key is to look at various sign posts to gauge where the market is going.
He expects "the lows of May 6 to be a magnet" with the telling factor being: "Does volume attentuate as we approach those levels, or do we see supply really dominate demand and selling really pick up?"