Welcome back to the channel everyone today, i want to talk about the shorts actually starting to cover, and i really want to break down why it's important that the shorts like iceberg research are choosing now to cover and how this could have a knock-on domino effect as Well so stay tuned and let's make some money, but before i dive into the video, if you haven't already be sure to sign up to moomoo using the special thomas james, investing promotion. Not only do you get a free stock worth up to 350 and not only do you get a second free stock with a guaranteed value of dollars, but you also get a third free stock on top of that with another guaranteed value of thirty dollars. So that's at least eighty dollars in guaranteed free stocks, just for signing up with moomoo and depositing at least a hundred dollars. You could always sell those shares and get two entirely free shares of amc just for signing up and depositing, and this promotion ends on the 20th of october.

So if you haven't already be sure to sign up and deposit, if you have already done that, then you should start getting your free stocks today, and i want to dive straight in with the key information so iceberg. Research tweeted yesterday saying we covered our amc shorts down 30 from our initial position, meaning the amc stock is down 30 and they made a 30 gain. They also went on to talk about how they agree with the apes, on demanding more transparency on the role of market makers in the meme saga. Payment for order flow structurally generates conflicts of interest, but there is frequent confusion between market makers and activist short sellers.

Different crowds - basically meaning there are some good eggs, but also, i guess, a lot of bad eggs as well. Now i want to explain why this is really really important and actually really good news for us: amc, apes, iceberg research started shorting amc on the 2nd of july, when amc was somewhere between 53 and around 48. Obviously, right then iceberg research was correct, as amc fell to a low of around 31 rose back up again and continued falling to a low of 29. But why this is important is because iceberg research was holding their short position at 29 and therefore at a low of 29 or 28.91.

At that time, iceberg research still saw amc going lower. Obviously it turned out to be the wrong move for iceberg research. As amc came back up here to a high of around 52 nearly 53 and then obviously continued back downwards now, the reason why iceberg research didn't cover their short at 29 is because, at the time amc was in this downtrend and they thought the amc was going To continue lower to below 20 and all the way back down to two dollars, but this is where it gets really interesting. Amc is kind of still in this similar downtrend.

If you had the mind of a hedgy and therefore surely amc is going to 15 or 7 or 10 right. So why is iceberg research getting out of their short now? If amc is going all the way back to five dollars, and the only answer is because iceberg research have done their due diligence and their research they've seen amc made a low of 29 and they also saw amc made. A recent low of around 33 they've realized that the second low is not as low as the initial low and therefore, amc is going to continue to set higher lows in the future and therefore iceberg. Research does not believe they can make any more profit continuing to hold their amc short position.

They feel that right now, amc is the lowest that it's going to possibly go and that's why they've closed their shorts? Now, let's flip this around and think of it from our perspective, when amc squeezes up to say 200 a share, are you gon na sell your long position? The answer is probably gon na be no because you know it can go much much higher than that, but when amc gets to the very, very tip of the squeeze whatever, that might be, whether it's a thousand dollars a share, a hundred thousand dollars a share. A million dollars a share or whatever it might be. Are you going to sell your long position? Well, the answer is yes, because it's at the very top of the squeeze and you don't think that you can make any more profit. Therefore, people close their long positions and their short positions when they don't think they can make any more profit and they think the stock is going to start moving against them and they're gon na start, taking on losses or just losing.

Those unrealized gains therefore clearly iceberg. Researchers seen that amc fell to 29 and then fell recently to 31. They know that it's setting higher lows and therefore they don't think that they can make any more profit from their short position. Basically iceberg.

Researchers just told us guys, we've closed our shorts because amc is going up now. I also want to talk about the legitimacy of iceberg, research and the impact that they might have had or the total short position they might have had on amc iceberg. Research has no 13f forms filed with the sec, therefore they're, not an investment, firm or investment fund. Now this isn't strictly true, because you can be an investment, firm or investment fund and not have to file 13 f's, as there is a de minimis of 100 million dollars.

Therefore, basically iceberg research does not manage 100 million dollars or more because they don't file 13 f's to use a quote from the big short. This basically means that iceberg research is a dinky little fund with a dinky little web page and a couple million dollars in a fund. Therefore, iceberg research are a nobody closing. Their short position likely didn't have much of an impact on the physical amc stock or the physical amc short interest, but the idea behind them closing the short position is still very important because clearly, short sellers are doing, their research and short sellers are seeing amc set Higher lows and therefore they do not think they can make more profit from their amc shorts.

Therefore, i think iceberg research are going to be one of many short hedge funds that close their short position in the near future. Now, as more and more short, hedge funds do end up closing their short position, it's effectively going to create their own future, because, obviously, when a hedge fund covers its shorts, they have to buy amc shares which will push the price of amc up now. I also want to talk about this short iceberg found by jackson, hunter and amc biggms. Now this comes from a report called counterfeiting stock 2.0.

I've read through this entire report and i have to say this report is the best thing that i've ever read that completely summarizes naked short selling and all of the manipulation going on in the market, so i'll be sure to leave the link to this report down. In the description below so, it starts off by giving you a glossary of terms such as broker dealer, a hedge fund, a market maker, a short seller, the sec, the dtcc, a short sale, a disclosed short, a naked short, a fail to deliver options. Naked calls, and also much more at the bottom which i'll get on to later, but first obviously i want to talk about this short iceberg. As you can see at the top of the iceberg, we've got fails to deliver and disclosed shorts things that are disclosed in the public eye and can be found on the fcc website.

You then also have settlement fails, continuous net settlement with a dtc x, clearing misc marked tickets, false locates one day, lens naked options, illegal stock lending, perpetual rolling foreign exchanges and probably even more down here as well. A major loophole that was intentionally left in regulation. Sho was the grandfathering inn of all pre-sho naked shorting. This rule is akin to telling bank robbers if you make it to the front door of the bank before the cops arrive.

The theft is okay. Only the dtc knows for certain how many short says a perpetual fails to deliver, but it's most likely in the billions in 1998 refco, a large short hedge fund, filed bankruptcy and was unable to meet margin, calls on their naked short shares now. First, i think this bit here is really really important, because it shows that even large short hedge funds that do have significant amounts of naked shorts can still go bankrupt and can still be margin called. Therefore, at the end of the day, even large institutions like citadel, cannot hide their naked shorts from margin calls.

Under this scenario, the broker dealers are the next line of financial responsibility. The number of shares that allegedly should have been bought in was 400 million naked shorts, but that probably never happened. The dtc owned by the broker-dealers just buried the 400 million counterfeit shares in their system, where they allegedly remain grandfathered into legitimacy by the sec and because they're grandfathered into legitimacy, the sec, the dtc and prime brokers. All pretend there's no longer any failed delivers and they just simply don't exist.

Even though the victim companies have permanently suffered a 400 million share dilution in their stock and the problem is that these companies can't even buy back these 400 million shares to undilute the stock, because the 400 million shares don't exist. What is there to buy back? They don't exist. A significant amount of counterfeiting is the result of the options market exemptions. The rule allows certain option contracts to serve as borrowed shares for short sales, even though there is no company issued share behind the options contract.

This is basically explaining those divorced puts and the deep in the money put options in the deep in the money call options. The loophole is easily abused, helped in part by the sec's apparent inability to globally monitor compliance. There has been considerable pressure on the sec to close the options maker exemption, but through january 2008 they have refused to act three months prior to show the aggregate failed to deliver on the nasdaq and the new york stock exchange averaged around 150 million shares a day. Three months after show it dropped by about 20 million, as counterfeit shares found new hiding places.

It is noteworthy that aggregate failed to deliver are the only indices of counterfeit shares, the dtc and the prime brokers report to the sec. The bulk of the counterfeiting remains undisclosed, so don't be deceived when the sec and the industry minimise the fails to deliver information. It's akin to the lookout on the titanic reporting an ice cube ahead. This report also talks about the grandfathering clause, the options maker exemption.

He also talks about short squeezes. He also then goes on to talk about bankrupting the victim company and crashing the stock, and it also talks about frivolous investigations and also class action, lawsuits pulling margin and much much more as well. Now i also want to touch on china and evergrande as well. The chinese property sector bonds slump amid evergrande crisis now back here in april 2021, pretty much all of the property bonds for evergrande, caja group, central china, real estate, easy tactic, fantasia, greenland and even more we're all trading somewhere between 85 to 105, maybe 110 pence on A dollar so basically at par value.

However, over the last six months, pretty much all of these bonds have fallen to somewhere around here and are basically worthless. Many other bonds have also fallen, but not quite as much. I just thought this graph was a really really good example of the contagion that's about to be spread worldwide as a result of evergrande and the chinese property sector. Now i also wanted to talk about the wider market and the s p.

500.. The fed's bostik says i see little evidence that present inflation is causing the kind of economic damage that would bring the fed's policy position into question. Basically saying that present inflation isn't really a problem and because of present inflation, they don't think the fed's policy position is wrong and they also don't think that present inflation is going to cause any economic damage, but fed bostick also says that u.s inflation is broadening and The fact that it's also not transitory and therefore inflation is going to get worse and is going to become a problem. Inflation data for september gets released tomorrow.

Therefore, we'll soon be able to see how inflation is stacking up compared to the last few months, which, by the way, are basically a perfect mirror of 2008 inflation. There are many rumors that september inflation is going to be 5.5 or even higher, which could spell the start of a potential hyperinflation. Now i also want to give some real examples of what the next market crash could actually look like for stocks in the s p. 500 - and i guess more specifically tech stocks without 2020 hindsight, would you hold a stock? You believed in through a 99 pullback congrats to everyone who held amazon through the 98.7 decline back in 2000 to 2002..

We can see here a perfect example which looks like it's been taken from a very old newspaper in the year 2000 amazon set high of 75.25, then in 2001 to 2002 it set a low of only 5.51 and 98.7 decline. Obviously, yes, nowadays buying amazon at 75. A share would be absolutely brilliant because it's now over 3 000 a share, and that is many many many many many times your investment returned, but you also would have been very, very gutted at the time buying amazon for 75 dollars a share if it pulled back To only five dollars a share, similar things can be seen with cisco falling from 82 dollars a share down to 11 a share and 86.5 pullback. We've also got yahoo falling from 238 dollars, a share down to only eight dollars, a share 96.4 pullback guys just imagine, buying a stock like paypal for 255 dollars a share and it pulls back to ten dollars.

A share. Imagine holding through that and seeing what happens over the next 10 or 20 years, but that's just a prime example of what could happen during the next recession and during the next major market crash. As always guys be sure to. Let me know what you think about the shorts starting to cover and how this is actually good news for amc and also, while you're down there be sure to sign up to moomoo, using their special thomas james, investing promotion to get those three free stocks and, as Always guys, if you enjoyed this video, be sure to check out some of my others, alternatively, subscribe to the channel and leave that notification bell, because that way, you'll be alerted.

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