Is turmoil caused by financial terrorism?

The Dow was up 240 points before opening, then lingered between 100 and -100, then finally surged 400 points on news that the U.K. temporarily banned short-selling. Following suit, the SEC may also enforce such a ban as early as Friday morning.

Short sellers are getting a bad rap these days. It's perfectly legal to bet against a stock, but it's illegal if rumors and misinformation are spread to manipulate a stock's price. Some people have even gone as far as to call these short sellers unpatriotic in betting against American investment pillars like Morgan Stanley and Goldman Sachs in a time of market upheaval.

Others are also joining forces to discourage, if not stop, short selling. New York A.G. Andrew Cuomo will investigate into whether there were any illegal activities to influence stock prices of financial companies. Several mammoth pension funds -- California State Teachers' Retirement System and the New York State Common Retirement Fund -- ceased to lend shares for short sales.

Jim Cramer even speculated on "financial terrorism" -- people out there who want to weaken America by bringing capitalism to its knees.

The ban on short selling is controversial. Is it really fair? Why not also ban long buying? Just stop all trading completely for a few days then. Are short sellers being singled out and punished unreasonably? Well, the next few days would be interesting. If the market continues a downward spiral even after this ban, then we'll all find out the problem is really deeper than short sellers. But right now the ban is welcomed news to investors, CEOs, and regulators.