Originally Posted by capjak
Short Sellers are interested in driving a stock down, they do not really care if it is over valued or not.
In a normal market short sellers are disciplined by a market that generally trends higher. And also the knowledge that their upside is capped but their downside is unlimited. These conditions normally create a very difficult environment for the short seller. His mission is to find not only a stock that is over valued, but also a catalyst that will bring about a price correction.
In the current market, where panic prevails, the normal discipline is significantly curtailed. If in addition to that their are firms who are widely known to be troubled, have opaque balance sheets and whose liquidity is dependent on investor confidence, the short seller can create his own catalyst by trying to drive the price down rapidly.