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This blog post originally appeared on RealMoney Silver on Sept. 25 at 8:29 a.m. EDT.

I don't have to tell you things are bad. Everybody knows things are bad. It's a depression. Everybody's out of work or scared of losing their job. The dollar buys a nickel's worth, banks are going bust, shopkeepers keep a gun under the counter, punks are running wild in the street, and there's nobody anywhere who seems to know what to do. And there's no end to it. We know the air is unfit to breathe and our food is unfit to eat. And we sit watching our TVs while some local newscaster tells us that today we had 15 homicides and 63 violent crimes, as if that's the way it's supposed to be! We all know things are bad -- worse than bad -- they're crazy.-- Howard Beale (Peter Finch), Network

As a dedicated short seller, it is not surprising that I have come to the defense of the practice.

I talk my book no differently (but hopefully more objectively) than many permabulls did over the last two years when they ignored an historic

Black Swan event

in credit that created a distortion and disconnect between debt and equity prices, a phenomenon that still exists today in the TED spread, which has gone over 3.00 for only the third time in history -- the other two times were during the market crash of October 1987 and on last Thursday -- and an

all-time high

in the two-year U.S. swap spreads (the two-year U.S. note vs. Libor).

A month ago, I wrote an

op-ed column

in the

Financial Times

that spelled out my view that short sellers shouldn't be restricted in their activity and shouldn't be blamed for the abuses in lending, credit formation and in the growth of the unregulated derivative markets that got us into the mess that we are in today. Rather, investors and regulators should have listened to short sellers' economic forebodings.

Last Thursday's "

Blame the Blamers

" again suggested that critics of short sellers were focusing on the wrong group and that those pointing their fingers are in denial and need to take a hard look at themselves in the mirror.

On Monday, in "

Wall Street Has Sold Out America

," I characterized Wall Street and its managements as some of the true culprits and unscrupulous players in the current credit morass.

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In Tuesday's "

11 Ways to Fix the Short Ban

," I wrote that the


short-selling ban would quickly have the opposite effect of its intended construction. Confirming my fears, the

S&P 500

has dropped by about 5% this week. In light of

General Electric's


guidedown this morning, my reference to the company in 11 Ways should be noted:

Companies begging to be added to the "do not short" list should be ashamed of themselves, especially great companies like General Electric. Indeed, I would like GE's chairman to "man up" and publicly say that the decision to put his company on the list is dumb. Exploiting and executing well in fair markets is what has made General Electric one of the best and most respected companies in the world. GE should act like it and be proactive.-- Doug Kass, The Edge

No one, it seems, wants to take the responsibility for their actions -- neither Wall Street nor the corporate managements that "kept on dancing" while they drank from the bowl of credit excess.

It remains to be seen whether GE's management will blame the short-selling community for their profit guidedown (and forced deleveraging) that was just


this morning.

The truth is that

Jeffrey Immelt

is cleaning up the mess that

Jack Welch

left as his legacy to General Electric -- much in the way that

Vikram Pandit

is cleaning up the mess at



that he inherited from

Sandy Weill


John Thain

is cleaning up the mess at

Merrill Lynch


that was dropped in his lap by "Ernest"

Stan O'Neal

-- but no one, it seems, wants to tell the truth anymore.

It's like everything everywhere is going crazy, so we don't go out any more. We sit in the house, and slowly the world we're living in is getting smaller, and all we say is, "Please, at least leave us alone in our living rooms. Let me have my toaster and my TV and my steel-belted radials, and I won't say anything. Just leave us alone."-- Howard Beale, Network

Regardless, I will continue to stand by my unwavering view that corporate profit expectations for 2008 to 2010 remain far too optimistic and will serve to mute the upside to equities and that the general reduction in credit availability will weigh on economic activity to a far greater degree than the talking heads expect.

Well, I'm not going to leave you alone. I want you to get mad!I don't want you to protest. I don't want you to riot. I don't want you to write to your Congressman, because I wouldn't know what to tell you to write. I don't know what to do about the depression and the inflation and the Russians and the crime in the street. All I know is that first, you've got to get mad.-- Howard Beale, Network

All this gets me to something suspicious that occurred in the trading of

Goldman Sachs'


shares near the close of trading on Tuesday, Sept. 23, when its shares


by over $5 in the last few minutes of trading, just as the S&P was finishing off a day in which stocks tumbled by nearly 2% and closed at their lows. As we now know, soon after the close, Warren Buffett's

Berkshire Hathaway


announced an infusion of $5 billion of capital in the form of a preferred investment in Goldman Sachs, and Goldman's shares rose by another $7 or so in after-market trading.

Whither the SEC?

Of course, the SEC will be nowhere to be seen in investigating the suspicious trading in Goldman Sachs; it is busy adding General Electric,

International Business Machines


and who knows what other companies' shares in its ill-chosen and paranoid quest for justice via a hastily crafted manipulation of the investment playing field, which bans short selling in selected issues.

SEC Commissioner Chris Cox is a loose cannon, and in this instance, I agree with Senator McCain: He should be fired posthaste.

I have watched the arrogant cabal of overcompensated Wall Street traders and executives take full advantage of every American (and many foreigners!) in their decade-long abuses in packaging credit for the sole purpose of lining their own pockets.

I have watched the regulators and ratings agencies rubber stamp financial weapons of mass destruction.

I have watched borrowers and lenders misuse mortgage and consumer credit.

I have watched the full Congressional hearings over the last two days, in which our uninformed political leaders have acted like school kids who are late in submitting their homework.

You've gotta say, "I'm a human being, goddammit! My life has value!" So, I want you to get up now. I want all of you to get up out of your chairs. I want you to get up right now and go to the window, open it, and stick your head out and yell, "I'm as mad as hell, and I'm not going to take this anymore!!!"-- Howard Beale, Network

I, for one, am mad as hell, and I am not going to take it anymore.

Things are bad -- they are worse than bad.

Doug Kass writes daily for

RealMoney Silver

, a premium bundle service from For a free trial to

RealMoney Silver

and exclusive access to Mr. Kass' daily trading diary, please click here.

At the time of publication, Kass and/or his funds had no positions in the stocks mentioned, although holdings can change at any time.

Doug Kass is founder and president of Seabreeze Partners Management, Inc., and the general partner and investment manager of Seabreeze Partners Short LP and Seabreeze Partners Short Offshore Fund, Ltd.