Short Sellers vs The DOJ??

What is going on at the SEC? The reddit community has become fixated on this idea that the SEC and The Department of Justice are going after illegal naked short-sellers. These sellers are assumed to be the same sellers that where driving down the price of “meme stocks” such as GameStop (GME). These claims of illegal shorting has many convinced that these stocks are short squeezes waiting to happen. It is speculated that there are hundreds of millions of shares of GME stock in circulation, the problem with this is there are only 76,000,000 shares that were offered! It has been proven that their are large dark pools where people trade mass amounts of stock that are not with in the rules of the New York Stock Exchange. It is believed here synthetic shares of GME are produced using various financing tools.  

The Founder of Chewy and now is in charge of GME believes that there is going to be justice brought to those who have been illegal manipulating markets and that we may witness the greatest short squeeze of all time. Cohen stirs the pot of twittter buy hinting at possible investigations. 

As of the past few days Elon Musk has shared in a that he has been compiling evidence that shows these illegal market manipulation tactics and is going to try and bring those responsible to Justice. He really saw how Wall Street has operated when launching Tesla. Tesla is his baby and I think Wall Street tried to kill it. They tried to short it out of existence, Munger told him several reasons why he thought it would fail. You have to remember the world from 2000 to 2008 was so much more different. Oil and military defense ran the show in the stock market and there was no room for an EV company to come and disrupt that. This obviously didn’t work so now Elon he has the ability to go on the offensive.

Russia invading Ukraine has smothered all other news as of the past couple of weeks and this has really allowed this investigation to go under the radar. But, it is very important as these short sellers play a large role in markets and there may be major structural changes coming to the market place faster than we realize.  There are many ways this can play out moving forward and will be worth paying attention to. 


Leave A Comment

Your email address will not be published. Required fields are marked *