Welcome back to channel everyone today i'll talk about how a number of different hedge funds are currently in the process of going bankrupt after creating billions of synthetic shares, so stay tuned and let's make some money - and i want to dive straight in with the key information. So i want to start by showing you this video of doug sifu, the ceo of virtue, who just admitted to the creation of synthetic shares. I want to talk about how the creation of these synthetic shares has effectively led to infinite liquidity and how the fed and the u.s treasury is effectively backstopping. This infinite liquidity and supporting it and helping to provide it, but also how this backstopping is becoming more and more stressed, and how it's leading to a number of different hedge funds that are going to end up going bankrupt.

So roy tweeted, this video and said the wholesalers are effectively providing infinite liquidity. Here's doug sifu the ceo of a liquidity fairy aka virtue financial. He said it sounds like he's admitting to the potential of infinite synthetic shares they just hide or cover the share dilution with derivatives. So let's hear what doug sifu actually had to say on the mata, what we call size, improvement and we've been very upfront and very transparent about providing that level of data.

So what that means is in the 8 000 names to the extent there's not liquidity. On a lit exchange, fundamentally, the wholesalers are providing infinite liquidity at the nbbo or the inside price. So if we get an order for a thousand shares in reagan, mms stock that no one's ever heard of yeah and there's 200 shares on nasdaq and new york, we fill out a thousand shares at that inside price. That's meaningful liquidity 55 of the orders that we received bob.

We provide size improvement in a complete. You know, as he calls it an auction environment who's going to provide that the liquidity so right. There doug sifu, just admitted to creating synthetic shares if there's only 200 shares available to purchase, but somebody places an order for a thousand shares. They effectively create 800 additional shares to satisfy that order, and he says that's a good thing, because they're creating meaningful liquidity and helping orders to be filled and helping transactions to take place.

But as ashley says, the stock market doesn't need a liquidity ferry. It needs stock prices that are determined based on supply and demand. If you're trying to buy a thousand shares, but only 200 are available at the price you want to pay, then the price should increase until there is a willing seller. For example, if a fund is trying to buy a million shares of amc at twelve dollars per share, but there's only a few thousand shares available at twelve thousand dollars per share that, instead of creating additional synthetic shares, the price should just move upwards until the buy Order is completely filled and, as ashley says, infinite shares only dilute the price and effectively end up seller boxing, genuine american companies and rocket astronaut tweeted saying i get infinite liquidity to keep the wheels turning effectively naked shorting under the guise of liquidity.

But the problem comes when they take your money and never actually go and buy or find or locate those shares. This is why i believe, there's a massive amount of synthetic or naked shares, and he said it's why, once they're in such a deep massive buried situation ak when they've created so many synthetic shares that they can't actually get out from underneath the problem they instead put The companies under bankruptcy, so they never actually have to find those shares. Obviously, if you've created too many synthetic shares - and you can't resolve the problem - the hedges so far are taking the opinion of well. Let's just sell a box the company - let's just bankrupt it.

Let's get it delisted from the exchange, then nobody will want to buy the stock and we won't have to locate the shares or resolve the problem of synthetic shares and he said that's why the shorts pile in as well. They know a company is getting seller boxed. So it's effectively an easy win or an easy short for them, and he said that's effectively why it's a massive theft, fraud ponzi scheme, but their time is coming. Rizzo also answers the question of where exactly these market makers are getting the money to support and to help create.

All of these synthetic shares. Rizzo has said that infinite liquidity, meaning that hedge funds and asset management, companies, aka, blackrock and vanguard, are being provided. Infinite liquidity by the federal reserve and the u.s treasury fire repos, reverse repos derivatives, treasury bills, cdo securitization, mortgage-backed securities and more. He said it's.

The biggest ponzi fugazi slash fun, cayman island shadow banking scheme, you've ever seen, but at the same time we know the fed, and we know that these hedge funds are becoming more and more stressed in each of the last three or the last four days. We've seen the reverse reboot facility setting a new all-time high every single day, we're also seeing inflation continuing to spiral out of control, inflation, isn't reducing as expected or as told to us by the fed. Instead, inflation is continuing to rise and guys, if you didn't already know, moomoo, don't accept payment for order flow because they don't clear through clearing houses like apex brokers, they actually have their own clearinghouse future. That does not accept payment for order flow and clears the orders separately away from citadel.

Therefore, moomoo is brilliant for buying those amc shares and if you sign up to moomoo right now, using the link in the description below you can currently get five free stocks worth up to two thousand five hundred dollars each. That's a total of up to twelve thousand five hundred dollars in free stocks and a free share of lucid guaranteed. On top of that, and this is why many hedge funds are steadily going bankrupt and why some hedge funds are about to close sharp. So let's hear this interview from liz clemen about a number of different hedge funds and why they're about to go bankrupt? How much worse is this going to get i mean these are just a couple of names that have reported their very bad performance yeah.

I think it's going to get a lot worse, because what i'm astounded by is a lack of risk discipline in these hedge funds. We talk about asset bubbles in meme stocks, we talk about bubbles and specs. We talk about bubbles in cryptocurrency, but these are supposed to be some of the most sophisticated investors and the reason people give 2 management free and 20 incentive free is to manage the risk in down markets. What we've seen is that the large hedge funds, long short equity hedge funds, have got into spac investing, have got into private equity, investing got into venture capital, investing which is not their traditional expertise and they're borrowing money.

So when the market turns they're not able to be flexible and move quickly, what amazes me is people, as you say, are paying these guys to be much smarter than the rest of us in the room and look what is happening here when the markets flip a Switch and the tables do turn that's when, as buffett likes to say, you see, who's been swimming naked as the tide goes out. Well, i know you can't name names, but what types of bets have gone so wrong way that we will start to see some hedge funds that have made those bets maybe go under, and i think raj has really hit the nail on the head here. He said that these hedge funds have been investing in crypto they've, been investing in spax they've, been taking risky bets trying to shore meme stocks, all while borrowing billions and billions and billions of dollars from these major banks and from the fed in terms of reverse repos. They've made these risky bets, they've lost my inspects, they've lost money in crypto, they've lost money, shorting, the meme stocks, and they don't have enough money to pay back these loans and to pay back the cash that they've borrowed, and that is effectively why these hedge funds Are stuck and they can't escape, the market has fallen against them.

Meme stocks have run against them as well and they're just stuck, and they can't get out and that's why we're seeing some hedge funds, like melvin capital, already closing their doors. Some hedge funds, like tiger global management being down over 50 percent and we're now seeing even more funds like maverick and lone pine, both being down over 30 this year. Both of these hedge funds have likely been stung by the route in technology stocks and also been stung by other risky bets like crypto, spax and shorting meme stocks. It says lee and steve's hedge funds have tumbled by roughly a third this year joining other tiger.

Cubs stung by the slide in technology stocks, maverick capital dropped 32.5 through may, among its largest first quarter, bets were stakes in south korean e-commerce giant and amazon. Both wages would have been among its biggest losers if the firm continued to hold the stocks through last month. Two stocks it held in the first quarter work day and shopify have been among the hardest here, dropping 43 per cent and 73 respectively. So we're seeing more and more and more hedge funds losing 30 50 or even more and closing their doors, and it now seems like they're, also trying to suck even more money from crypto average ape tweeted, saying, eth or ethereum got the knife.

They are in desperate need of liquidity. Over the last 24 hours, ethereum has dropped by 12 over the last month, it's down by 23 as well in total. This goes to show these hedge funds are scrambling for their money back in cash to meet these margin requirements. They were selling off bitcoin in the past, now they're starting to sell off ethereum and other smaller crypto coins and as nazim tweeted.

All of these sources are pointing to one thing, which is the fact that citadel securities is slowly also going bankrupt and as the capacity letter tweeted they said, may cpi, showing inflation at a fresh 40-year high of 8.6 was the fed's worst nightmare. They've said signs of inflation peaking in april were wrong, and now the fed must raise rates at least eight times. They've said the only way to control inflation will be a fed induced recession. This can't end well.

Obviously, inflation is continuing to spiral out of control and therefore the fed needs to continue raising rates and raising rates faster and more dramatically in order to fight inflation. But obviously raising these rates so fast and so dramatically is going to cause a stock market crash and will effectively cause a fed induced recession. Obviously, as all of these large blue chip stocks end up crashing, these hedge funds are going to struggle more and more and more to meet their margin requirements and we're going to see more and more large hedge funds, like melvin capital, closing their doors, and don't forget These large funds that are currently shorting amc, even though they've shorted billions of synthetic shares, which is obviously worth billions and billions of dollars, that's only a fairly small percentage of their overall portfolio. Many of these large funds may only have say 10 percent of their overall fund size, shorting amc and the remaining 90 is still very long on the market, long on tech stocks and long on the s p.

500.. These funds are obviously getting closer and closer and closer to that margin. Call as their overall 90 of their entire fund portfolio is steadily shrinking and when they do end up getting that entire fund-wide margin call they'll, be forced to sell off their long positions and, most importantly, cover their short positions and close out of their amc. Shorts and obviously, when these large, the largest of the large funds, are forced to close out of their amc shorts while being liquidated, it will cause that amc squeeze they'll be forced to not only buy back millions of amc shares but forced to buy back.

Billions of amc shares and obviously, when these large funds start placing market buy, orders for billions of amc shares right in the open market. Amc will squeeze to unimaginable highs, so guys be sure to. Let me know what you think down in the comments below and also be sure to ding that notification bell, because that way, you'll be alerted. When i upload a new video cheers.