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Economy
Losses on short positions in U.S. firms top $70 billion
2021-01-29
[Reuters] - Short-sellers are sitting on estimated losses of $70.87 billion from their short positions in U.S. companies so far this year, data from financial data analytics firm Ortex showed on Thursday.

The hefty losses come as shares of highly-shorted GameStop jumped more than 1,000% in the past week without a clear business reason,
...no business reason, just a bunch of trolls with $600 stimulus checks to use for vengeance...
Somehow the sympathy meter isn't twitching one little bit for the hedge funds that lost billions here...
forcing short-sellers to buy back into the stock to cover potential losses -- defined as a short-squeeze -- while retail investors then piled in to benefit from the surge.

Chasing shorted companies became a trend among retail traders, rippling across U.S. markets and Europe. Ortex data showed that as of Wednesday, there were loss-making short positions on more than 5,000 U.S. firms.
From Instapundit: “10,000 national guard troops to Wall Street by Monday.”
More at the link
Related:
GameStop: 2017-06-11 Ann Taylor, Dress Barn, Loft, Lane Bryant: Store closures on the way
Posted by:badanov

#13  /\ I realize there's lots of frustration and angst out there, but let's keep it friendly and collegial here in Burgstad if we possibly can. Thanks :-)
Posted by: Besoeker   2021-01-29 15:30  

#12  @#7: Based on your comments it is clear you do not understand what stock shorting means. Plenty of information on the web for that. Also, plenty of information about what is actually going. Don’t wait to be hand fed, do some research.
Posted by: Gritch Clomoting4297   2021-01-29 15:00  

#11   No, WallStreetBets isn’t robbing Wall Street to help the little guy

Sooner or later, GameStop's stock is going to return to normal levels. And when it does, we are likely to find that little wealth was actually transferred from wealthy hedge fund investors to the general public. Short losses as the stock appreciated will be largely balanced out by short gains as the stock falls. The gains of GameStop shareholders as the stock appreciates will be balanced by losses as the stock declines.

But while there won't be a big transfer between short sellers as a group to shareholders as a group, there will be big wealth transfers within these groups. People who bought GameStop early and who had the good sense to sell near the top of the bubble will make a lot of money. People who buy into GameStop near the top and don't sell until after the stock starts to fall will lose money.

In other words, the GameStop bubble will have the same practical effect as any other pump-and-dump scheme: transferring wealth from those who got into the scheme late to those who got into it early. The fact that there are short-sellers on the other side of some of these trades doesn't change the analysis.
Posted by: KBK   2021-01-29 14:10  

#10  These kids think they are getting Wall Street back for 08. My son is in the group and bought AMC It’s kind of funny
Posted by: Beavis   2021-01-29 11:43  

#9  Many of the initial shorts at the $40 level have covered with a massive loss. Then the Redditers and hedgies rode it up long. Now it’s an obvious short again, if you can manage to borrow it. Lot of people getting an education.
Posted by: KBK   2021-01-29 10:28  

#8  According to S-3 Partners which tracks short interest on a daily basis, they haven't liquidated anything. In fact they are even more short at 139.7% of the float and a hunk of it is naked short.

It is not some kind of state secret that shorting has the potential for unlimited losses. The redditt kids did excellent due diligence over quite some time. They further restricted their shares and used way out of the money calls to cement their position.

If S-3 is correct and they have been thus far, there hasn't been any short squeeze. At least not yet.
Posted by: Cesare   2021-01-29 09:28  

#7  (1) Maybe I don't get what happened but wouldn't someone who sold it short (to hurt Gamestop initially) have no more stock because they sold it. And thus don't owe anybody, they just missed out on opportunity when it went up and up?

(2) Or did they sell at whatever price was set at the end of the day, they thought it was a buck but ended up 300 dollars or something like that?

(3) Lastly although I'm gleeful to see someone shank Wall Street, aren't those guys playing with other peoples retirement money and isn't it unlikely the folks who lost billions will ever be punished?
Posted by: rjschwarz   2021-01-29 09:19  

#6  The pros might have jumped in but they were late to the party. The seventy billion dollar loss is not going to be felt by the retailers who used Robin Hood to do their damage. And by the way, after being closed out, they are back at work this morning on a half dozen stocks. The is like West Texas State beating Notre Dame.
Posted by: b   2021-01-29 09:11  

#5  you shouldn't buy things that you cant pay for nor sell things that you dont own.
Posted by: irish rage boy   2021-01-29 08:50  

#4  "Mortimer - turn those machines back on!"
Posted by: Raj   2021-01-29 07:58  

#3  ^ unless you know those who rig it. See - Congress
Posted by: Procopius2k   2021-01-29 07:36  

#2  Day trading is all about knowing when to get in and when to get out. Basically the same odds as calling two consecutive coin tosses correctly.
Posted by: M. Murcek   2021-01-29 06:14  

#1  The pros jumped in on the squeeze. They’re making out like bandits.

When the music stops, it will be the amateurs on Robinhood that will be suspended like Wily Coyote over the chasm.
Posted by: KBK   2021-01-29 00:20  

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