The shorts are the bag holders. Longs sell their shares to shorts at peak prices, who then return those shares to the lenders. The lenders could sell, but they probably won't since they are in this for the long-term and that's why they lent the shares in the first place.
Back then there was no Ryan Cohen or WSB. Shorts don’t control the narrative anymore. They had the chance to cover at $3-4 (at a significant profit) last year, but they were too greedy and wanted the stock to go to $0 and see GME file for bankruptcy.
The interest rate to borrow GME shares has little to do with the Fed rates. It actually hit 45% last week as there are almost no more GME shares available to borrow.
Shorts are bleeding about 2% every day just on interest and have little road left to run.
Yes there is. At current prices it would be a disaster and Ryan Cohen and his 2 other mates on the board would likely block that. If share price hits $100 would make more sense. In effect GameStop would save the shorts who wanted the company to die in the first place.
Also, for this to stop the short squeeze the company would need to issue 30% of their float and then the shorts would still need to find another 100% of float to cover fully. The shorting emperors are left without clothes any way you cut it.
Here are a few pointers from a WSB member with a position in $GME
1. Short sellers have been running the stock into the ground over the past years and have been stupid enough to get to roughly 130% short interest as percentage of available float.
2. There are no more shares available for them to borrow and sell short, WSB has jumped into this trade following Ryan Cohen (your dog must know him), buying as many shares as possible, decreasing the float even further and pushing the price up.
3. Ryan Cohen owns about 13% of the company. He founded chewy.com and is an e-commerce wizard who wants to turn GameStop around from a brick-and-mortar shop to a digital / e-commerce player. He joined the board last week together with two other former Chewy execs (COO and CMO). FYI GameStop digital sales are 300% yoy and the company has recently posted a profit for the first time in many quarters. Shorts pretend like Chewy never happened, Ryan has nothing to do with GameStop and digital sales are nonexistent.
4. This short squeeze is inevitable. There are no other moves short sellers can do. They are trapped and check-mate is near. It will be similar to VW in 2008 and more aggressive than Overstock last year.
No it’s not. WSB is orchestrating a short squeeze. The aim is to make a transfer of wealth from shorts like Melvin Capital to WSB. This whole charade is due to the stupidity of short sellers who shorted more Gamestop shares than there are publicly traded. Check out the Overstock story from last year or VW from 2008. This will be exactly like that.