Saturday, October the 4th, 2008
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Part 1: Short selling

  1. Let’s say BigWig has 10,000 shares of Apple Corp. (worth, say, $150 each).
  2. JoeWeasel approaches BigWig and requests to “rent” these shares for a week, for say $50,000.
  3. BigWig sees this as a good deal, for once JoeWeasel returns his shares, in effect, he’s received $50,000 “for free.” So he says OK, and gives his shares over to JoeWeasel.
  4. JoeWeasel then immediately sells these shares (at $150 each) and receives $1,500,000 for it.
  5. JoeWeasel then writes a blog entry about how Steve Job’s cancer has resurfaced (or he had a heart attack or whatever). Once the media picks up on this, there is mass hysteria and panic—and the perceived value of Apple Corp. drops. Consequently, a drop in its share prices follows; so it’s now, say, $100 per share.
  6. JoeWeasel then quickly buys back 10,000 shares at this new lowered price of $1,000,000 using the $1,500,000 he pocketed a couple of days prior; netting him $500,000.
  7. At the end of the week, JoeWeasel returns the shares and $50,000 as a renting fee to BigWig.
  8. JoeWeasel walks away with $450,000 for a week’s hard work.
  9. In a few days, people realise that JoeWeasel was lying about Steve Job’s cancer, and the Apple Corp.’s share prices correct themselves—returning again to $150 per share. So BigWig didn’t really lose either.

This sort of thing really hurts my brain.

This is a printer-friendly version of the journal entry “A beginner’s guide to being evil” from actuality.log. Visit to read the original entry and follow any responses to it.

One Response to “A beginner’s guide to being evil”

  1. uXuf says:

    That sounds so much like a thing called “shorting”! Lol just kidding, nice place you have around here. Will be back for more:)

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