Welcome back to the channel everyone today, i want to talk a little bit more about what is possibly one of the most corrupt things i've ever read about, which is non-regulatory hauls, so stay tuned, and let's make some money, i'd love to be massively massively wrong on This one, and therefore i'd really like it if some more wrinkled brain apes could do some due diligence on top of the work that i've done and find out a little bit more about non-regulatory hulls, and now i want to dive straight in with the key information. So i spoke about non-regulatory halts in my video the other day, if you missed out on that one i'll give you a quick recap, so non-regulatory halts or delays occur on exchanges such as the new york stock exchange, but not the nasdaq when there is a significant Imbalance in the pending buy and sell orders in a security. So what could cause a significant imbalance in the pending, buy and sell orders of a security? Well, you've got a if there's very, very thin liquidity if it's a scarce market and there's very few trades placed. Therefore, somebody could be selling a share for ten dollars, but somebody else might only want to buy that share for five dollars and there's a massive massive gap in the middle with a very heavily traded stock.

Like amc, there's only a very small difference between the bid and ask price of a singular cent or a fraction of a cent, and that's why trades execute in amc every single? Second, because there's always a buyer and a seller willing to buy and sell amc for the same price. But if you have a stock, that's very thinly traded! There's going to be a significant imbalance between the pending, buy and sell orders and there's going to be a giant gap in the middle now. The second scenario, where you'd see a significant imbalance in the pending buy and sell orders is, during a short squeeze. Obviously, the price is going to be increasing so fast that there's not much time for buyers and sellers to place orders very close together.

Obviously, the price is going to increase in leaps and bounds from the previous price. It's not going to jump singular cents at a time. It's not going to jump whole dollars at a time. It will jump in batches of 5 or 10 or 15 or 20 dollars per every single tick.

You're gon na have somebody placing a sell order at 3. 263, which will be filled, another sell order at 3 687, which will be filled and then another one at and 4 four dollars, which will also be filled and therefore the price will increase by say six hundred dollars in a matter of only a few seconds or A few minutes like i showed you in that example, from the other day in dja zf and the sec say when an imbalance occurs. Trading is stopped to alert market participants to the situation and to allow the exchange specialists to disseminate information to investors concerning a price range where trading may begin again on this exchange and therefore, when there's a significant imbalance in the pending, buy and sell, orders trading will Be paused and exchange specialists will disseminate a price range where trading may begin again. Now.

Obviously, that's also a bit worrying, because trading could be halted for up to 10 days as the sec say here, and we're having to rely on exchange specialists to disseminate that information. In that price range now, obviously, a little bit later in this video i'll dig into exactly who these exchange specialists actually are and what their role is. But the sec also say a non-regulatory trading call or delay on one exchange like the new york stock exchange does not preclude other markets from trading this security like the nasdaq or the brazilian stock exchange or any other exchange where those adrs or bdrs or whatever else Dr's are traded on. You may remember that, malarkey from a few months ago, where a brazilian exchange listed some depository receipts of amc stock amc, stock, depository receipts could also be traded on other exchanges and therefore those exchanges won't have to pause trading.

It will just be the new york stock exchange. Now please also bear that in mind for later on, in the video is that even if trading is paused on the new york stock exchange trading is still allowed to continue on other exchanges like the brazilian stock exchange, and there will still be a quoted price on That exchange, if you didn't already know, you can currently get up to 250 dollars in free bitcoin, just for signing up with block fi, using the link in the description below and making your first deposit with blockfi instead of just buying some bitcoin and leaving it in A wallet forever, you can earn interest on your deposits up to nine percent interest per year, also paid in more cryptocurrency. On top of that block fight also offer a rewards credit card with a whopping introductory rate of 3.5 cashback on your purchases, also paid in crypto. That way, you can continue to accumulate more and more and more bitcoin and not just leave it in a wallet and forget about it and when you've generated a massive profit on your investment.

Instead of having to sell off your crypto and potentially missing out on the next run up and recognizing all of those gains for tax purposes, you can just take out a crypto backed loan with blockfi. That way, you can get cash to meet your day-to-day expenditure without having to sell off your crypto. It says the sec does not halt or delay trading in a security for news pending or order imbalances, but it can suspend trading for up to 10 days. So i then clicked here on specialists, which opens a new window on the sec website and gives a bit of a definition or an explanation of what those specialists actually are.

It says a specialist is a person who is a member of the stock exchange, such as the new york stock exchange, whose role is to facilitate trading in certain stocks. Specialists must make a market in the stock they trade by displaying their best bid and ask prices to the market during trading hours. So a specialist sounds a little bit like a market maker. Let's read a little bit more and then i'll explain if they actually are a market maker and what specialists there are or who the specialists are for the new york stock exchange.

It says they're also required to maintain a fair and orderly market. I'd be interested to see their definition of fair and orderly market, but we'll let that slide. It says they do this by stepping in with their own capital, to help reduce market volatility. When there are not sufficient buyers or sellers, it says the rules of the exchange prohibit specialists from trading ahead of investors, who have placed orders to buy or sell a security at the same price.

While the number of stocks as specialist trades depends on how active the stock actually trades and most specialists are responsible for trading five to ten stocks. So therefore, if there's a massive massive inflow of buyers, because if fund is being liquidated, it's going to have a massive market buy order placed, they can fill the role of sellers if necessary by selling off some of their own amc stock. If they hold any. This could potentially somewhat curb the squeeze, as we may have large specialists with large holdings of amc selling stocks at an earlier price to help reduce market volatility.

But again, let's first figure out who these specialists are and if they hold large amounts of amc or not. So i then went over to investopedia to try and figure out the definition of a new york stock exchange specialist or an nyse specialist investopedia has an article saying nasdaq: market makers versus nyse specialists. What's the difference so the new york stock exchange and the nasdaq each employ market makers, dealers or traders whose role is to increase the liquidity of their respective exchanges, provide more fluid and efficient trading and maintain a fair and orderly market. So an nyse specialist is a market maker.

So, as a more in-depth explanation, it says the new york stock exchange operates with a system of individual security specialists who work on the nyse trading floor and specialize in facilitating trades of a specific stock. A specialist is simply a type of market maker and the main difference it says. In contrast, the nasdaq is an electronic market that does not have a trading floor. Instead, the nasdaq relies on multiple market makers, major broker-dealer members of the nasdaq for actively traded stocks.

Now, obviously, i'm sure we all know of some of those major broker dealer members, but who are the new york stock exchange specialists? So in new york stock exchange specialist has to be capable of holding multiple roles. They have to be an auctioneer to post, buy and sell orders on behalf of investors. They have to be able to act as an agent to execute trades and settle transactions. They have to act as a catalyst to ensure that enough interest exists for a particular stock to ensure the market is active or liquid enough.

And if it's not, they have to seek out investors to make the market liquid, and they also have to be able to act as a principal in the case of a demand, supply and balance by making adjustments and buying and selling from their own personal inventory. To equalize the market, so i then went over to the new york stock exchange website to figure out who are the new york stock exchange, designated market maker firms and, as you may expect, we have citadel securities gts securities and virtue america. So, basically, if there's a significant imbalance in the pending, buy and sell orders due to a short squeeze, then the sec can stop trading and allow the exchange specialists or citadel to figure out a fair trading range. Now that to me seems very, very corrupt, but how exactly is citadel going to determine a fair trading range and what happens after a trading suspension ends? So it says the broker filing the form must have a reasonable basis for believing the information is accurate and that it comes from reliable sources.

A broker generally cannot quote the stock or solicit or recommend the stock to any investor until the form is approved. So, basically, that responsible specialist has to submit a form for what price they plan for amc to trade in, and it says after approval, the broker can begin quoting and other brokers may also quote the stock relying or piggybacking on the first brokers quote without filing the Form or reviewing the company's information on their own and therefore it's likely the very first broker, which is going to be that responsible specialist is going to determine the amc price by relying or piggybacking on other quotes, which may be on a different exchange. Like the brazilian stock exchange, so after the sec has paused trading citadel can take whatever price amc is trading at on the brazilian stock exchange and use that, for the new trading price for amc after the sec has finished stopping the trading or halting the trading. So i wonder who's responsible for setting the price of amc on the brazilian stock exchange and who's responsible for trading those bdrs.

Well, i don't think it's you and i, because only accredited investors can trade, those bdrs and they're not available to regular retail investors. So it's going to be institutions only and that i think, is the corruption in these non-regulatory halls. As i said earlier in the video. Hopefully, an ape with more wrinkles than i have can prove me wrong or point out where i've gone wrong here, but so far that's what i found now.

I also wanted to go through this article sent to lou versus wall street and what i think it means for the amc squeeze billionaire chris rockhoss and his partners paid themselves 914 million pounds or 1.2 billion dollars just before their investors suffered a record year of losses. Now we know that many hedge funds, like melvin capital, suffered record losses this year, but i'm sure that gay, plotkin and many other owners of these hedge funds still took home a very hefty wedge of cash. As we can see here, chris ruckos took home 1.2 billion dollars. I'm sure we could find how much money gabe plotkin took home as his salary and bonus, and we also know just how much money ken griffin earns, but obviously these hedge funds are also taking on massive massive losses and therefore what that means they don't have.

Is cash, but what they do have is synthetic short positions that still need to be covered, and this is just another one of these expenses that is going to cause the amc squeeze to happen. Amc isn't going to go back to two dollars and amc isn't going to go bankrupt, so these hedge funds can never realize a massive gain and they're going to be sitting on massive unrealized losses, and this is why these hedge funds can't continue pulling these tricks forever. Obviously have to pay money to borrow the shares - it's not much, but it's still some money. They have to pay money to reset those failed delivers.

They have to pay money to their staff and their hedge fund owners, who often take out billions and billions of dollars. Every single year and therefore, if these hedge funds are paying out billions of dollars to the hedge fund owners, they obviously aren't going to have any more cash to continue supporting their massive amc, short positions and their massive amc, synthetic short positions and when they start failing Those margin calls they are going to be forced to cover their shorts, guys be sure to. Let me know down in the comments below what you think about the true corruption that is non-regulatory horse and, as always guys, if you enjoyed this video, be sure to check out some of my others. Alternatively, subscribe to channel and ding that notification bell, because that way, you'll be alerted when i upload a new video cheers.