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My Not So Short Story on GME


Eastwood
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Reddit crowd talking about how/why sears and blockbuster had big increases today...tons of naked shorts finally get closed with new sec rules in place?

Seems weird to me but I did find on Google that blockbuster also had a 2000% increase back in January when everything was crazy

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So is this the graph that I see referenced on reddit

image.thumb.png.08e62438ceb3f3b125fd2a03b38da890.png

What explains the massive spike in SI all of a sudden? Was there a new massive coordinated short attack just recently, or is there an issue with the underlying data? And if it's the latter, is it even accurate now? Like most of this saga, a huge spike in short interest at this point in the game makes no sense to me. 

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3 hours ago, Blotto said:

What explains the massive spike in SI all of a sudden? Was there a new massive coordinated short attack just recently, or is there an issue with the underlying data? And if it's the latter, is it even accurate now? Like most of this saga, a huge spike in short interest at this point in the game makes no sense to me. 

Pure short interest data can be deceptive.  (1) the reporting is subject to almost 2 weeks of lag (2) does not represent a net short position - it can be offset by other derivatives position on the same underlying. 

a party can simultaneously short a put option (non-reportable position), and short the stock, to be roughly directionally neutral while collecting premium on it. 

If there was a market-wide spike in short interest of the shares, without any offsetting positions, you would expect the stock price to have dumped.  It hasnt.  Someone would need to tally all the net changes in all the derivatives and other instruments to really deconstruct the narrative of GME.

As always with this stock...theres fuckery afoot.

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13 hours ago, Eastwood said:

I haven't followed GME for a few months, is the split what is driving the current spike? Or is it a short squeeze again?
Also, are you still holding some GME?
Seems like a never ending story of crazyness, and the fight of good vs. evil, traders vs. investors, or suits vs. jeans.....I'm rooting for the commoners and reddidiots

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I haven't followed GME for a few months, is the split what is driving the current spike? Or is it a short squeeze again?
Also, are you still holding some GME?
Seems like a never ending story of crazyness, and the fight of good vs. evil, traders vs. investors, or suits vs. jeans.....I'm rooting for the commoners and reddidiots

The spike started before the announcement of the split. I hold 1 souvenir share of GME. In my opinion, anyone with any sense took the money and ran already. I’m now loaded up on CRSR because they have a high institutional ownership percentage and are a good acquisition target for companies looking to increase gaming peripheral market share. Also, they sell good products in a space that has had year over year growth for many years in a row, including during the heart of Covid.
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Also, this has been a rare day for me where I have a little time to burn, so I wanted to chime in on a lot of the chatter that has happened every since that fateful month of January. There’s been a lot of talk on the finance channels and in other media about the “meme driven,” “wallstreetbets,” or “retail investor” driven spike that was the GME trade. Horseshit. All of it. Look at the volumes. No way retail investors could be responsible. Retail player a part, as far as visibility goes, but the real reason behind all of it is that Wall Street was doing what it does but those who were doing it got out over their skis.

They were certain the GameStop was going bankrupt and if it wasn’t, it was damn near close enough that artificially depressing the share price would get it there anyway. Shit, the only reason I found it was because I was digging through stocks on TDA looking for value and found that GME was worth $10-12 after all assets and liabilities and was sitting at $5. Even if they went bankrupt, they were worth more than the share price. Groovy. But then they got to be 110% institutional ownership and 150% shorted and these finance douchebags want to tell us that retail is to blame? These are the same assholes who were telling us Bear Sterns, et al were just fine and the market was in no danger in 2007.

Same shit, different decade. Certain firms play stupid games, but only win temporarily stupid prizes. The game is rigged. Play by their rules as best as you can and don’t make any moves in the market that you can be held truly accountable for.

  • Hook 'Em 2
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I wished I had jumped into this thread from day one, since I have a unique insider view of GME.  But the following quote lifted from another forum I frequent outlines how/why 'HODL' still applies to $GME by the retail investor as yet another mechanism to expose the publicly-traded ponzi scheme and potentially squeeze the shorts even further.

And yeah, my GME shares are in book-entry form with Computershare.

Quote

Sure-- Basically, GME is believed to be heavily shorted and over-leveraged by hedge funds. Meaning the market is flooded with more "synthetic shares" than should actually exist, artificially keeping the price down (even through people continue to buy). There are 72M shares that should exist, and the current theories are that the amount shorted is at least that, all the way into the billions.

The problem is that even when you buy stocks with your broker, they are still "in the market", and can therefore be borrowed against. So the belief is that these hedge funds are continuing to naked short GME and sell them in dark pools, continuing to artificially keep the price down (essentially indefinitely) no matter how many are being bought by retail.

(John Stewart actually goes into detail about all of this, including naked shorting and dark pools, in his recent show on AppleTV. First 15 mins are also on his youtube channel: https://www.youtube.com/watch?v=bP74RBTE8kI )

To combat this, redditors started directly registering their shares (DRS tranfer) from their brokers directly to GameStop's holding company, ComputerShare. This effectively takes the share out of the market completely, and into the owner's possession. (Kind of like back in the days when you could get physical stock certificate and put it in a safe.)

Once all (or close) to that 72M shares are directly registered with ComputerShare, the belief is that this will finally be the trigger for those hedge funds to be margin called (forced to fill all those borrows/"buy back" all those synthetic shorts), triggering the squeeze. (Meaning the price of GME will skyrocket, larger than any short squeeze we've seen before.)

The movement has been so big, that two quarters ago, GameStop themselves started reporting on how many shares have been directly registered in their earnings reports. In October, it was 5.2M. In yesterday's earnings report, it was 9M for January, which is 12.5% of the total shares. (Redditors believe it to be at least 10M now, with their voluntary tracking, as people continue to buy/DRS every day.)

It's kind of amazing how a bunch of people on the internet figured this out, and how many are rallying to the cause.

 

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