They never covered their shorts. It's only a matter of time before it goes ballistic and, frankly, threatens to take down the entire stock market. It's a ticking time bomb -- and now it's smoking.
GME shorts have essentially written a blank check to the market. They don't have shares to cover their shorts. When it's time to cover, they'll have to pay whatever price the market demands. In order to cover, they'll have to liquidate their other holdings. Liquidating large holdings in a market like this could cause all kinds of problems.
The shorts were already due... deadlines passed and extended and extended again. The market making bankers are the same ones selling the short shares, they investigated themselves and decided to give themselves a break.
SEC numbers and a few other sources. I read somewhere that currently the estimated number of shorts is 4x actual number of actual shares. Not sure if it's true though.
They do, but not in bulk. The idea that suddenly, all at once, the people short GME will instantly need to buy shares to cover their shorts is just not how it works.
The implication being that the handful of parties who hold shorts in GME are "singlehandedly" responsible for propping up the value of the entire stock market? Seems unlikely...
A deer jumping in front of your car and totaling it doesn't imply that the deer is keeping the car running.
That said, I'm all for what's happening with $GME. They've been cheating the public for years and now the public has turned a cheat (naked shorts) around and is going to get rich off of it. Fair play.
Which leads to interesting questions like "How much would it cost to implode the market?", "Are there non-monetary incentives for doing so?", and "Are there any prediction markets where I can trade on the chance the stock market will implode?"
Is that a guess? Or does reporting data still indicate there is a lot short? Because my understanding was that much of the shorts had covered according to the drop in reported short interest.
It's not like GME is a fixed supply. Can someone explain why at some point GME wouldn't just issue more shares and capture the short squeeze themselves? Basically you buyback if you're undervalued and you sell (and issue if necessarily) if you're overvalued.
Timing and legal obligations mostly. Share issues require a lengthy process to get approved. GME actually had one pre-approved, but they still couldn't use it, as they may not legally do so while the executives have material information the public does not. GME had an earnings announcement that was unforunately timed.
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[ 1.4 ms ] story [ 61.1 ms ] threadCould you expand on that?
The shorts were already due... deadlines passed and extended and extended again. The market making bankers are the same ones selling the short shares, they investigated themselves and decided to give themselves a break.
The market is totally rigged.
GME just hit $170/share after hours, having closed around 90 an hour ago.
Edit: $180/share
Edit 2: $200/share
Once you cover a short it isn’t really a short anymore. The whole point is to speculate.
That isn't how shorts work. You pay interest on the loan. It isn't like at day X suddenly you owe the share back or else you go to prison.
I think we're already seeing shares called back since likely gme wants to do a stock offering on a good valuation.
There's also not many shares left to short... so it is going to be interesting.
I'm a shareholder. I can call back my shares if I want and refuse to lend them. This is what Michael Burry did when he bought a stake.
The rest is assumptions.
> Just because the stock is super high doesnt mean anyone is going to actually accept it as collateral for funding.
if they issue direcly on the market it is going to get bought...
That said, I'm all for what's happening with $GME. They've been cheating the public for years and now the public has turned a cheat (naked shorts) around and is going to get rich off of it. Fair play.