Greece Bans Short-Selling After Monday's Stock Drop

Shares on the Athens Stock Exchange plunged to their lowest level in more than 14 years on Monday in response to market uncertainty over U.S. debt restructuring. The Greek authorities imposed a ban on short-selling after the drop, which was exacerbated by worries about European debt and the stability of the Euro.

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Although people in Greece are especially worried, regulators there banned short selling for two months after shares dropped to their lowest levels in 14 years during trading yesterday.

Joanna Kakissis reports from Athens.

JOANNA KAKISSIS: Short selling means people are betting on the prices of shares falling. Regulators hope the ban will keep share prices steady and reduce volatility in the market. But economist Yanis Varoufakis says it's a desperate move for desperate times.

Mr. YANIS VAROUFAKIS (Economist): When Greece is a broken economy within a eurozone which is in tatters. You may have noticed that a few weeks ago, Greek politicians were mindlessly celebrating the latest package for rescuing Greece. And if you look at that package, what it entails is substantial help from the eurozone. If the eurozone is on the verge of collapse, then, of course, Greece cannot expect to be saved by anyone.

KAKISSIS: Greece is more than $450 billion in debt. Last year, it became the first European Union country to seek international bailout loans. In exchange for the loans, the Greek parliament had to pass tough and unpopular austerity measures that have caused riots in central Athens.

The EU has long feared that the Greek debt crisis will spread. It is now trying to save two bigger eurozone economies: Italy and Spain. The European Central Bank is buying bonds from both countries. Yields on those bonds fell this morning.

For NPR News, I'm Joanna Kakissis, in Athens.

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