True, that's the actual crux of the question here; if you are inventing bad news and trading on it, then by my reading you're probably engaging in stock manipulation.
On the other hand, it seems that uncovering new true information, and then taking a short position on it, not illegal.
A lot of the comments in this thread were assuming that there was some crime just from reporting the bad news and trading on it, unconditionally on whether or not the news was true.
On the other hand, it seems that uncovering new true information, and then taking a short position on it, not illegal.
A lot of the comments in this thread were assuming that there was some crime just from reporting the bad news and trading on it, unconditionally on whether or not the news was true.