Welcome back to the channel everyone today, i want to explain why i think that amt squeeze will be a managed squeeze that's controlled by the sec. Yes, i do think that amc will definitely squeeze, but i do think the sec will get involved to stop it crashing. The entire financial system so stay tuned and let's make some money, and now i'm gon na dive straight in with the key information. So what would happen if amg squeezes? They can't force people to sell, so the price would simply keep increasing and we would have one of two scenarios scenario: a the price of amc reaches millions of dollars.

Yes, we will have a lot of people that sell when amc hits a hundred dollars or 200 or 300. there'll also be more that sell when amc reaches a thousand two thousand and three thousand. But theoretically, if there's still people left holding amc at that point and the shorts still need more shares to cover their positions, they have to keep on increasing their price until the apes sell and therefore, theoretically, if there are a bunch of apes that haven't yet sold The price of amc could indeed reach millions, and those people that held those shares would be crazily, rich scenario b, apes simply do not sell ever and the shorts can never close. Surely, at this point, the sec would have to step in and force some sort of settlement to close out those short positions.

Now i think realistically, there's also a scenario c, which is that most, if not all, apes, sell their shares between 100 and 5 000 per share. I think at that level it wouldn't crash the us economy, but i think both scenario, a and scenario b - would effectively crash the u.s financial system and the wider economy. Really. It would only be scenario c where the apes sale between 100 and 5 000, that wouldn't crash the entire market and the poster says so what's more interesting here is scenario b.

If the apes never sell and the shorts can never fully close, he says the sec will likely have some sort of threshold limit as far as they would let it go. They would be hoping for scenario a or more scenario c, but i think there's simply too many shares, so scenario b is potentially more likely again. I do think the sec is gon na set a threshold limit to ensure the wider financial system doesn't get crushed in the process. Obviously, i've spoken before about these non-regulatory trading halts that i'll touch on later in this video, but also believe it or not.

The sec did in the past, restrict short selling, but only when it was systematically important. Back in 2008, the sec issued a temporary order restricting short selling in shares of 19 financial firms. Obviously the big banks, so it seems the sec - does actually get involved, but by the sounds of it only when the market is going to crash, if the sec back in 2008 stopped short selling to prevent a market crash. It wouldn't surprise me if the sec intervened and forced people to sell their amc to again prevent another market crash again.

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They already have a pot of money set aside for the squeeze that they've been preparing over the last year. The pot will be split between shares outstanding that are real and synthetic shares, but just to keep it simple. Let's say this limit is a hundred k per share. Don't get me wrong? This limit could be a million dollars per share, but it could also be five thousand dollars per share or even lower again.

For my video, the other day where i spoke about, whether amc could potentially hit a hundred thousand dollars per share. I think this is another one of those variables we don't know when the sec is going to step in whether it's at five thousand or a hundred thousand or a million dollars per share. So let's say this limit is a hundred thousand dollars per share. The sec.

May get involved and stop trading when we reach seventy thousand dollars per share and give everybody else with remaining shares. A hundred thousand dollars per share each to allow the shorters to close out of their positions if they bump up the settlement from a hundred thousand dollars per share from the current market price of seventy thousand dollars per share, it would mean more people would be fine With that price than for them to let it run up to 100k or even higher, and then reduce the settlement back to 100k. Obviously, if amc is trading at 50, 000 per share and they halt trading and forced me to sell for a hundred thousand dollars per share, i would be a lot less mad if that happened than if amc ran up to two hundred thousand dollars per share, and They stopped trading and made me sell for less. He says in this case.

I think people probably would still sue and most likely win some money in the future, but this will be a problem the sec can deal with then in the future. As a too long didn't read, he says if this will be a managed event and the sec have used all this time to prepare for the mass. It would be obvious, there's a limit that the sec set where they won't allow it to go any higher and they'll settle all outstanding shares at that level. Now again, i think this is a very plausible scenario, especially if, when amc starts to run up and when amc starts to squeeze, if it does get out of hand, it wouldn't surprise me if the sec do step in quite rapidly.

At the start, you'll see amc jump 10 to 20 cents at a time. That'll all of a sudden, rapidly increase to 50 to whole dollar jumps every single second and then at some point it will increase to 10 to 20 jumps per second. But i think if the amc price started, jumping by thousands of dollars, every single second, the sec would have to get involved very very quickly. So i touched on this screenshot a little earlier in the video, but why i posted this on twitter.

It says in august 2008 the sec issued a temporary order restricting short selling in the shares of 19 financial firms deemed systematically important by reinforcing the penalties for failing to deliver the shares in time. Basically, not only did they ban short selling in the stocks of these 19 financial firms, but they also banned naked short selling and effectively banned the failure delivers of these shares. It says effective september 18th amid claims that aggressive short selling read this is naked short selling. Had played a role in the failure of financial giant lehman brothers, the sec extended and expanded the rule, to remove exceptions and to cover all companies, including market makers, wyatt said so when does it become systematically important that the sec have to get involved? I think the answer to this question is: when there's a risk the market will crash, the sec will get involved.

He asks, though, why is there a double standard to banks and the rest of the industry? Why can't you naked short banks, but they're more than happy for any other stock in the market, like amc to be naked shorted, so i actually did a little bit of searching and managed to find the list of these 19 largest financial stocks. He said one last sub-sample is of interest. In july 2008, the sec announced a temporary emergency ban on naked shorting in 19 large financial stocks. These firms included all of the primary dealers in treasury securities, as well as fannie mae and freddie mac.

So this list includes the largest investment and commercial banks with the most extensive debt security market operations. Eight institutions on this list survive our filter, as in eight institutions are still operating so like not bear stearns or lehman brothers and the ones that remain are bank of america, goldman sachs, morgan, stanley, citigroup and jp morgan. So obviously the sec is more than happy to step in and halt trading or halt shorting when it involves these large banks, but when it comes to amc, the sec evidently just don't care. Now there are some comments made back in 2008 that i found very, very interesting cardillo says in the marketplace.

We need both sides of the equation, but the relaxed regulation of the sec has led to abuse of short selling that has destroyed many many companies. He said this decision made by the sec to prevent short selling on these big banks will squeeze the shores cardillo added now, if there's any good news shorts will have to cover. So it seems the sec is all for squeezing shorts. If squeezing the shorts prevents the market crash, but as soon as squeezing shorts endangers the market, the sec don't want anything to do with it, and this is why i think that amc squeeze will be a managed event.

The sec are more than happy to step in when the market is a risk, but it means if these large financial institutions and large market makers like citadel are at risk when amc squeezes. The sec is likely to step in. If some of these large financial firms are getting squeezed by the amt squeeze, then the sec is obviously going to step in and save them just like they did back in 2008.. Now i actually found the exact ruling issued by the sec in 2008, and i found it very very interesting.

They've said we were concerned about the possible unnecessary or artificial price movements based on unfounded rumors regarding the financial stability of financial institutions. Now i do quite like this part here, where it talks about the unfounded rumors regarding the stability of financial institutions, almost as if there was no financial institutions that are in a bad position back in 2008.. Oh, how wrong they were, but the sec was also concerned by other issues, exacerbated by naked short selling. So right here in this sentence, the sec has admitted that naked shorting does definitely exist and in this instance they believe the excessive naked shorting led to excessive fluctuations of the prices of such securities in such a manner so as to threaten fair and orderly markets.

So when naked shorting threatens fair and orderly markets, as in naked shorting threatens to crush the economy, then the sec will step in. But if naked shorting is only causing a few companies like amc to fail, the sec don't care, but if naked shorting suddenly causes large banks and financial institutions to be squeezed, then the sec are going to stop in and put a halt to it. Now. I also wanted to quickly refresh your mind on these non-regulatory hauls.

They occur on exchanges such as the new york stock exchange when there's a significant imbalance in the pending, buy and sell orders in a security, as in when the price of a stock is squeezing. During a moa scenario, there will be a massive discrepancy between buy and sell orders, so the sec will have to get involved when an imbalance occurs. Trading is stopped to alert market participants to the situation and allow the exchange specialists to disseminate information to investors concerning a price range where trading may begin again on this exchange. Now, you might say, hang on tom, who are these exchange specialists that get to determine a price range for amc? Well, these exchange specialists are the market makers aka, citadel and virtue.

So when the sec exercised their non-regulatory haul and stopped, the trading on amc citadel gets to decide the price range in which amc resumes at, and it says a non-regulatory trading hall or delay on one exchange does not preclude other markets from trading this security and the Sec can suspend trading for up to 10 days and, if appropriate, take action to revoke a securities registration. Guys be sure to. Let me know down in the comments below whether you think that amc will be a managed squeeze or whether you think the sec will just let it ride and as always guys, if you enjoyed this video, be sure to check out some of my others. Alternatively, subscribe to channel and ding the notification bell, because that way, you'll be alerted when i upload a new video cheers.