He could just buy Ford, but Ford could fall if a recession hits. Finally, shorting is a way of putting money in the market when you can't find anything to buy. But as Armstrong points out, that was the situation a year ago, not today. All the studies show that the average investor has no real hope of consistently outguessing the ups and downs of the broad market through market timing. The arguments against shorting are persuasive.
Stock prices go up, and over time, generally go up more than they go down.
This means the short seller is running an uphill race. Another drawback is that often you can't short when you'd most want to. No law prevents a momentum investor from piling into a stock as it shoots up, but the U.S. Securities and Exchange Commission's Regulation T does exactly that in reverse to short sellers. A short seller also can get caught in a short squeeze. Lenders of shares enjoy the right to call them back at any time.