[omarchowdhury]

> I believe it when I see it. Isn't the majority of shares hold by the heavy pros anyway? I doubt the other Hedgefonds and Yolon Musks will sacrifice shit.

They don't need to. It's mathematically impossible for shorts to cover, because they've shorted more than the entire float.

[monopoledance]

I don't think that's how this works. They "just" need to pay twice for it. The over 100% borrows happen like this:

Alice owns one GME. Bob borrows the share and sells it to John. John doesn't know this is borrowed stock and borrows it to Lisa. This way way you got two borrows on one stock.

As you can see, the hedgefonds likely already recovered some stocks from 140% down to 113%.

Their intention was to speculate on Gamespots bankruptcy and there for not even have to buy back any shares. That's why they overshot like this and also why they are human scum needing to bleed for their sins.

I honestly don't know what it means for the short squeeze, if they reach <100%. I assume at that point it becomes less of an we against them, and increasingly more of an everyone against everyone, again.

[nowherebeen]

> if they reach <100%. I assume at that point it becomes less of an we against them

In order to cover their short, they actually need to buy shares with willing sellers. So it wouldn't be a case of everyone against everyone. The amount of holders will decrease proportional to the short percentage.

They just need to make sure they aren't buying while the sellers are decreasing their exposure. But that's quite easy to tell as the price would shoot sky high from all the short sellers buying.

[imtringued]

>Alice owns one GME. Bob borrows the share and sells it to John. John doesn't know this is borrowed stock and borrows it to Lisa. This way way you got two borrows on one stock.

The question is what happens on the "margin". Lets say there are 110 shorted shares. You need to get rid of 11 of them to eliminate the short squeeze (assuming nobody buys the remaining 99 shares to hold them).

Lisa owes 30 shares. She only has to buy 11 shares and then the rest of her shorts will have the potential to be in the money. She could buy one share and return it to the lender. She could now make an agreement with the lender to buy a share for a fixed price from the lender and return it and repeat this 11 times.

The question is, why would the lender agree to this instead of just charging market rate?

In my opinion the lender should be on the hook. By lending out your shares you receive interest payments that cover the risk of a "default" just like a regular bank loan. If the borrower fails to return the shares due to bankruptcy you just lose your share. This would significantly reduce the potential for a short squeeze because the lender would just agree to a share price that does not leave the borrower bankrupt.

[omarchowdhury]

Thanks for the explanation. Yes, they would need to pay more than once for it. In any scenario, the demand would outstrip the supply and hence there is still a short squeeze on the table.

[nly]

It's very reminiscent of how fractional reserve amplifies the money supply. John puts $100 in the bank. Bank lends $90 to Steve. Steve buys a thing from Ali. Ali puts $90 in another bank...Bank 2 lends $81 to Sheila...

Does a short/float ratio of 100% require multiple brokers to participate? How is the bookkeeping on these shorts maintained?