A hedge fund manager announced he was going to short GameStop stocks during the holiday season and the autists on r/WallStreetBets figured out that they had enough pooled resources to keep the stock from going down. This caused the hedge fund in question to become insolvent and now rich people are pissed that it happened and afraid that they'll organize to do something similar again.
It was also a naked short. Meaning they shorted more shares than the company had outstanding by around 30%. At the same time they were manipulating the market and doing behind the scenes strong arm deals to make sure GameStop tanked to bankruptcy despite having reasonable financials. Tens of thousands of jobs were on the line.
Now They literally can’t buy themselves out of this. Unlimited losses.
It was also a naked short. Meaning they shorted more shares than the company had outstanding by around 30%
Couple points of clarification. A naked short has nothing to do with the number of shares. Also, when you cover the short, you buy a position that goes back to the original owner. They buy themselves out by buying the same share multiple times. The problem is that the wallstreet bets crowd isn't selling so they have to buy on low volume which is making the price insane
GameStop? They're already dead, but the corpse has been weaponized to kill the Wall Street vultures.
Good
Except, Melvin is using CNBC to lie. There is no way they covered their shorts, there simply wasn't enough volume.
CNBC used vague language to report the 5:30AM call.
The sec should fine them for that. Is that not market manipulation??
Seems like market manipulation to me... but, the SEC is like the FBI. The exist to protect the status quo of criminality, not the constitution.
This is interesting because........?
Agree.. why??
A bunch of shit posters short squeezed a bunch of institutional investors.
Can someone ELI5?
A hedge fund manager announced he was going to short GameStop stocks during the holiday season and the autists on r/WallStreetBets figured out that they had enough pooled resources to keep the stock from going down. This caused the hedge fund in question to become insolvent and now rich people are pissed that it happened and afraid that they'll organize to do something similar again.
It was also a naked short. Meaning they shorted more shares than the company had outstanding by around 30%. At the same time they were manipulating the market and doing behind the scenes strong arm deals to make sure GameStop tanked to bankruptcy despite having reasonable financials. Tens of thousands of jobs were on the line.
Now They literally can’t buy themselves out of this. Unlimited losses.
Lol that is so dumb. They get what they fucking deserve.
Then their public shellacking was well-deserved.
Couple points of clarification. A naked short has nothing to do with the number of shares. Also, when you cover the short, you buy a position that goes back to the original owner. They buy themselves out by buying the same share multiple times. The problem is that the wallstreet bets crowd isn't selling so they have to buy on low volume which is making the price insane
Yes thanks for the clarification. Was trying to keep the technicalities to a minimum.
Thank you for that. (And LOL)
https://www.investopedia.com/ask/answers/how-does-one-make-money-short-selling/