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Nudity In the Senate

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Next Tuesday the Senate Judiciary Committee is scheduled to hold a hearing on the short-selling by analysts and hedge funds. Senators are apparently concerned about naked short-selling.

"Naked short-selling is against the law, and we're concerned about it," a spokesman for Sen. Orrin Hatch, R-Utah, a Judiciary Committee member, told Dow Jones.

It's probably a good idea to have legislators looking out for possibly fraudulent activities in the stock market. And the Good Lord only knows what those hedge fund guys are doing in those boxy little offices in Greenwich. But before the hearing, can someone get the Senators a good book on market regulation? They might as well know the law before they go mucking about in it. Some naked short-selling could be illegal, particularly if done with fraudulent intentions. But naked short selling is explicitly permitted for brokers who serve as market makers for securities.
More to the point, where's the evidence that there is enough naked short-selling, much less damage from naked short-selling, to justify a Senate hearing? Where are all those victims of undelivered stocks? Gary Weiss, call your office.
Gov't to Examine Hedge Fund Short Sales [Associated Press via Houston Chronicle]