From the Washington Post:
Federal regulators shot down rumors in the financial markets Tuesday afternoon that they were planning to ban short-selling of stocks in which the government has a stake.
"There is no truth to the rumor that we are considering restricting the short-selling of stocks in which the government has a stake," said John Nester, a spokesman for the Securities and Exchange Commission.
Financial markets were abuzz Tuesday with reports that the government was planning to ban short sales in the stock of some companies that have public investments. The government gained these shares in exchange for bailing out the firms as part of efforts to rescue of the financial system.
Freddie Mac and Fannie Mae soared as much as 18.5 percent and 15 percent, respectively, before closing 7.6 percent and 5.9 percent higher. American International Group spiked 12.6 percent, and Citigroup jumped 7.6 percent....MORE
