Today I Want to talk about how to reverse split will cause massive liquidations I Want to talk about how much the shorts will be losing before and after the reverse split and how that ties in with the current run on heavily shorted stocks. and I also want to dispel some more fun around that reverse split as well. So stay tuned and let's make some money. And now I'm going to dive straight in with the key.

Invasion So you may have seen yesterday that Matthew tweeted saying the average cost to borrow on AMC has increased to 368 percent and the Max cost to borrow increased to a blinding 495 percent. Now that's obviously been blown out of the park today with an average cost to borrow of 643 and a Max cost to borrow of 905. But Matthew Also, we're saying there's 185 million shares on loan 6.3 it is the cover and still 100 utilization. He said it's no coincidence the Costa borrow has skyrocketed since the FTX collapsed.

He said with the tokenized stocks from thin air. the last magic trick that these hedge funds had. Ever since the apps of FTX the Costa borrow has skyrocketed and these Hedges haven't found a way to bring down that cost to Borrowed fee. It seems those FTX tokenized synthetics may have been their last trick in their magical hat.

In order to bring down that cost to borrow and avoid crazy borrowed fees, we know they were using those FTX tokenized stocks as locates, but since the collapse of FTX it's been uncovered. they were indeed false locates. Since they now don't have those locates, whether it's false or not, they simply can't locate any real shares of AMC And that's why they're having to pay exorbitant costs to borrow now. I Think this is going to force these shorts to lose literally billions, if not trillions of dollars is how the cost to borrow ties in with the actual interest that's being paid before and after the reverse split stocks.

Batman's weirdest thing: I've been seeing 500 cost to borrow. So here's the numbers. When AMC was trading at 25 around December to November of 2021, it was being borrowed at a one percent borrower 8 or 25 cents for a 25 stock. Obviously, these shorts weren't losing much money paying only 25 cents for a 25 stock.

But now a 500 borrow fees, they'll be paying 25 for only a five dollar stock. And as Bigam's tweeted, that number now has actually increased even further. So we're seeing a Max cost to borrow fee on all takes of 905 and it cost to borrow average of 643 and again, even on Weeble which usually shows the cost of borrow fee around 120 130 percent. It's now showing it at 658.

So how exactly does these crazy borrow fees actually translate to monetary amounts lost by these hedge funds before and after the reverse split? Now, right now AMC is a six dollar stock. There's currently 185 million legal shares on loan, but let's round that down to 100 million just to make the numbers really, really easy. Therefore, the actual money be Shorts are paying is likely more than these calculations. But again, on the other side of the spectrum, we know these hedge funds have likely created billions of synthetic shorts.

Celestist assume is 2 billion shares actually shorted again. I Think 2 billion shares shorted is a fair estimate. That number may be higher, say 5 or 10 billion, but it may also be slightly lower. And again, we'll also use a range of borrow fees ranging from 300 like it was the other week to 900 like it has been today.

Or six dollar stock at a 300 cost to borrow fee means these shorts are paying 18 for every one AMC share they're borrowing over a full year period and again at a 900 cost to borrow fee. These shorts are paying fifty four dollars every year for a singular six dollar stock. Now, if you take 18, they're paying to borrow one AMC share and multiply it by the 100 million legally shorted shares. That's 1.8 billion dollars these shorts are paying each year.

However, again, if you factor in this synthetic shorts, that number could be as low as 1.8 billion, but could increase all the way to 36 billion dollars if these shorts are shorting 2 billion synthetic shares. Now, obviously 1.8 billion to 36 billion dollars is the annual fee they'll be paying on a pre-split valuation After a ten to one reverse split, the Shorts would theoretically be paying 10 times as much money. Now, obviously, the share price isn't exactly going to increase by 10 times because the AMC float has been combined with the eight float, and then the reverse split is happening after. At the same time, the float does also get 10 times smaller.

But if these Shorts theoretically are going to continue shorting AMC off the reverse split, those short positions would be increasing dramatically. Once again, basically saying that these two billion synthetic shares would theoretically decrease down to 200 million synthetics. but at the same time, if these Shorts continue shorting I'm sure it won't take that long for them to create another few billion synthetic shares. So once have created these new synthetic shares, instead of paying 1.8 billion to 36 billion dollars, they'll be paying 18 billion to 360 billion dollars per year.

And at the same time, that's using our lower cost to borrow. For the example of only 300. If we increase that to 900, the numbers seem catastrophic. Uh, 900 cost of borrow fee with 100 million shorted shares, they'd be paying 5.4 billion dollars per year, including the 2 billion synthetics.

That increases to 108 billion dollars per year being paid just to borrow AMC shares. And as I said, that's before the reverse split or for the ten to one reverse split, and when the Shorts continue shorting more synthetic shares, that number could even increase by 10 times. meaning they'd be paying somewhere between 54 billion dollars and one trillion dollars per year just to continue borrowing AMC shares The shortest? Paying a trillion dollars per year just to continue borrowing AMC shares for a few more days seems absolutely crazy if these ridiculously high custom borrow fees stay elevated. I Don't think it will be long until these shorts simply don't have enough money left to continue borrowing those aims he shares.

and obviously as they burn through their entire fund and end up being liquidated at that liquidation point, they will be forced to close out of their short positions now again. I Also wanted to dispel some thud with the help of Boss Blunts and AMC for all you may have seen. Some people saying that after the reverse split will be losing 90 of our shares and it will be even more difficult for AMC to rise again and even easier for the Shorts to continue shorting. but I think ultimately that is major major third.

As Boss Blunts explains here, yes we are seeing a 10 for one River split, but at the same time the value of each share goes up by 10 times as well. He said, what's the difference between 10 10 bills or a singular one hundred dollar bill? Basically saying, what's the difference difference between holding ten six dollar shares or holding one sixty dollar share Whether you're holding ten ten dollar bills or a singular hundred dollar bill, they both equal one hundred dollars. Now again, some people have said we were at seventy two dollars and they bought it down all the way to three dollars and eighty cents. What stops them bringing it down from the post reverse split price all the way back down to five Dollars again.

and Below. But as Ligma said, how come they don't bring the price down from five dollars to Fifty cents? Because it's the exact same percentage drop. Bringing the price down from fifty dollars to five dollars is the exact same as bringing the price down from five dollars to fifty cents. Fifty dollars to five dollars is a ninety percent drop, and five dollars to fifty cents is also a ninety percent drop as well.

Whether we do a ten for One reverse split or not, ninety percent is still ninety percent. Fifty Dollars down to Five Dollars is the exact same as five dollars down to fifty cents. The only difference is is that all for the reverse split. If the Shorts continue creating more synthetic shares, they'll be paying 10 times as much to borrow those shares.

Percentage gains are still the same no matter which way you look at it. A one dollar stock increasing to a thousand dollars is still a one hundred thousand percent gain. A ten dollar stock increasing to ten thousand dollars is also a one hundred thousand percent gain. A one dollar stock increasing to ten thousand dollars is a million percent gained, and a ten dollar stock increasing to a hundred thousand dollars is also a million percent gained as well.

It's just as likely that AMC will increase from twenty dollars per split to twenty thousand dollars as it would from two dollars up to two thousand dollars pre-split I Really do hope this dispels some of the fud around the reverse split. Even though the flow of AMC and 8 will be getting smaller, the share prices of those stocks also increase with the exact same percentage. A reverse split isn't some kind of unfair measure where the stock price decreases from six dollars down to say, like, one dollar while they take away ninety percent of our shares. A reverse split is a fair calculated process whereby if there's a ten for One reverse split, the share price also increases by 10 times as well to balance out the reduction in shares.

And finally, Mactan has tweeted something about the current market that really does suggest we're just about to see the next leg down of the market crash. He tweeted saying an alien searching for intelligent life would not come to this planet. In the last few legs of the market crash, we've seen the market crashing a small bear Market rally with more crashing followed by another bear Market rally that's slightly stronger than the one previous to it. Again, we've then seen more crashing small bear Market rally more crashing and then a bear Market rally that's slightly stronger than the one before back 10 is suggesting this time is no different.

We've seen more crashing a small bear Market rally more crashing and then another bear Market Rally that's slightly stronger than the one before Mag 10 is basically suggesting that over the next, say a week or so the next lay down of the market crash will continue. But guys, be sure to let me know what you think down in the comments below. And as always, guys, be sure to ding that notification Bell because that way you'll be alerted when I upload a new video. Cheers!.