The mechanics of the situation work like this:
First, short term gains and losses are netted, resulting in a short term gain or loss depending on the numbers.
Second, long term gains and losses are netted, resulting in a long term gain or loss depending on the numbers.
If you have a gain in one category, (long term/short term), and a loss in the other category, then those numbers are netted.
If the result of all that is a capital loss, then $3,000 of the loss can be subtracted from all other income - salary, dividends, interest, etc. If there's still capital loss available after that it's carried forward to the following tax year and the cycle of netting begins again.
The process is completely mechanical, you have no options or elections to change these mechanics.
