No, I think its deeper than that. There is a visceral negative reaction to “speculators” profiting from downward movements in prices. Its quite amusing to ask someone to justify why they feel like this – why is it ok to profit from increase in price, but not ok to profit from decreases in price; the tortured reasoning is a wonder to behold. I think the underlying reason is a instinctive dislike of someone gaining at a time when the tribe is seen as losing. The problem is due to the framing of the issue. Finance is presented in the media as having the purpose of delivering ever rising asset prices. Any increase in prices is described and presented in a positive tone, any decline in a negative tone. This is utterly pervasive; you would be considered utterly mad if you suggested that ever increasing asset prices was not a good thing. Against this background it is not surprising that ordinary people feel that declining asset prices is bad news for the tribe. Therefore anyone who benefits from this bad event for the tribe is a shifty, untrustworthy sort who must be punished for their disloyal behaviour. That is why hedge funds are disliked.

The solution would be to present the (financial) markets as having the purpose of discovering and disseminating information about investments and goods and services. In this light it is clear that hedge funds are doing something to benefit the “tribe”. Short sellers are calling bullshit on dodgy businesses and alerting everyone to poor investments.