[ISL]

Agreed on all but the second point. Short-selling definitely does push prices downward in the short-term.

Suppose you own a share that you don't want to sell and are willing to loan it to me for a month. I'll have to give it back to you, as well as interest payments in the interim. I can sell that share today, which will push the price down. My entire bet is that I can buy your share back in less-than-a-month for substantially less than that for which I sold it.

If I am wrong, I will have to repurchase the share at or before the end of the month at market-price, restoring the number of outstanding shares to where they were at the beginning.