Apparently one of the prime reasons that the market started allowing short selling of stock some 300 hundred years ago was "market efficiency."
Traders used to have to send messages afoot or on horse to arrange a sale. As riding horses for long distances gets old after awhile, people were open to tools that would make trading more efficient. Shorting a stock allows gentlemen traders to make a deal, then send a rider to get the stock later to clear the transaction. Combining carriage rides is efficient.
Today's communication technology obliviates most of the concern with market efficiency. If anything, today's market is suffering from hyperactivity. The trades take place faster than real information.
I am looking at Yahoo Charts. The chart currently indicates that over 100 million shares DJIA stock traded during September 29th sell off.
The cause for this sell off is that people don't know how to price mortgage backed securities. Consequently, they don't know how to price any stock that might have a dependency on such securities. To add more unknowns, they don't know the form of the bailout.
Trillions of dollars traded hands based on lack of knowledge, and herd movement.
We are in an age of trading hyperactivity. Artificial tools like the short sell, which were designed in a day when horses were common on Wall Street, just add to the turmoil.