Faced with an unprecedented financial crisis, the government is moving to rein in short selling that was blamed, in part, for the demise of Lehman Brothers, AIG and Bear Stearns & Co.

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Faced with an unprecedented financial crisis, the government is moving to rein in short selling that was blamed, in part, for the demise of Lehman Brothers, AIG and Bear Stearns & Co.

Presaging September’s credit-market meltdown, almost all of the 25 most shorted stocks through Aug. 31 were financial-services companies. On Friday, the Securities and Exchange Commission temporarily banned the practice of betting against financial stocks. The move will halt until Oct. 2 short-selling on 799 financial stocks.

Short selling involves betting against a company’s stock by borrowing its shares, selling them, and pocketing the difference if they fall.

“The emergency order temporarily banning short-selling of financial stocks will restore equilibrium to markets,” SEC Chairman Christopher Cox said in a statement. The SEC also said it would temporarily ease restrictions on companies’ ability to repurchase their stock, and force money managers to report their short positions in certain stocks that are not included among the 799 banned companies.