The problem, however, is that this subset of the economy (banking, investing), once past the IPO stage, is basically an entire exercise on how to make paper, no

The problem, however, is that this subset of the economy (banking, investing), once past the IPO stage, is basically an entire exercise on how to make paper, not how to make wealth. The system, in overvaluing short term results, is often counterproductive. (Note Costco's poor stock price versus Enron before the collapse.) Goldman Sachs was profiting billions by having access to millisecond-level trading capabilities. ( http://zerohedge.blogspot.com/2009/07/is-case-of-quant-trading-industrial.html http://zerohedge.blogspot.com/2009/07/is-case-of-quant-tradi... et al) This is a case of a society becoming good at creating paper, not wealth. And that is the point. Short sellers are capitalizing on the ability to create paper, not wealth.