Welcome back to the channel everyone today i want to talk about another fun withdrawing from melvin capital and how everything to do with melvin, the mainstream media and the sec is lining up for an imminent squeeze now i know that sounds very clickbaity, but just hear me Out so stay tuned and let's make some money, and now i want to dive straight in with the key information, so steve cohen's, point 72 is to redeem its 750 million dollar investment from hedge fund melvin capital. Now you may remember that citadel has also withdrawn the majority of its investment in melbourne. Capital citadel invested two billion dollars and so far has withdrawn one and a half billion point 72 invested 750 million dollars and has now requested the full 750 million back now it does say that point 72 will be redeeming the money in separate withdrawals, but they have Asked for the full 750 million dollar investment point 72, as well as citadel funds and firm partners, made the cash infusion into gabe plotkin's fund in january 2021.. Now there's actually a specific reason as to why they invested this money and i'll cover it.

In a few moments it says, melvin was dealing with a reddit inspired short squeeze that led to it losing nearly 55 that month are raising about 7 billion dollars worth of capital. So what happened with melvin capital short position in gamestop back in january of 2021? Why didn't melvin capital go under and end up being margin called so technically melvin capital's short position in gamestop was packaged off and sold to both citadel and steve cohen's .72. So not only did citadel and point 72 invest 2 billion and 750 million dollars. They effectively did this to take off some of the stress and share some of that short position effectively, that 2.5 billion dollar portfolio chunk was sold off to someone or somebody with a higher pain tolerance.

Back in january 2021, melvin capital were massively over leveraged on their gamestop short position, but i think back in january of 2021 citadel was only facilitating the creation of the synthetic shares and didn't hold a significant short position. Back then, therefore, citadel had more margin, availability and had massive amounts of free margin on its long positions. Large enough to share some of that risk from melvin capital. But now both citadel and point 72 are very, very close to being margin called and therefore need to offload some of that risk back to melvin capital by withdrawing their investment.

Colin gladman tweeted, saying melvin capital has seen increasing losses on all of their long positions. Citadel has recalled most of its two billion dollar. Investment from them and steve cohen has also redeemed his 750 million dollar investment from them. As well colin said, melvin is 100 going to be the full guy for what's to come, lenders are pulling money back, but things do take time so later on in this video.

I also want to tell you about how everything is falling into place with the mainstream media and the sec ready for an imminent squeeze and ready to pin the blame on melvin capital. Gergavin tweeted, saying melvin capital is down 60 over the last 14 months after another. Terrible january and february and march as well, he says melvin capital was down 39 in 2021 january. Melvin was down another 15.

On top of that february, they were down 2.8 and so far in march, melvin is down 5. On top of all of that, melvin has been taking on massive massive losses and citadel cannot afford to leave their two billion dollar investment in melvin capital, because they know that melvin capital will go barely up and citadel needs. That margin citadel is also very, very close to approaching that margin call and therefore needs the extra 2 billion dollars of liquid cash to make sure that they don't get margin called as well. But again considering.

The melvin fund is down 60 year-over-year, paying out an additional 2.75 billion dollars, won't leave it with much margin at all, and that's why melvin is 100 going to be the full guy for what's to come with this imminent squeeze and, interestingly, the mainstream media seem to Be getting on board with an imminent squeeze as well guys, if you didn't already know, mumu and futu have just officially announced that future does not accept payment for order flow, and therefore you don't have to worry about your trades, going through sketchy, dark pools or being Given to citadel with moomoo, you can currently get five free shares, valued up to three thousand five hundred dollars each and a free share with a guaranteed value of twenty dollars, just for signing up with moomoo, using the link in the description below and making your first Deposit moomoo is also a brilliant commission free trading platform that has tons of technical indicators and advanced charting tools, moomoo publishes daily short selling data position, cost distribution and much much more moomoo is also incredibly easy to use and will help you to trade like a pro. So guys be sure to send it to moomoo, using the link in the description below to get up to a total of seventeen thousand five hundred dollars in free shares. Donahue george tweeted saying that motley fool is putting out positive amc articles and it's not just the motley fool. It's the street as well and donahue.

George says this is a surprise to me. Is this because of the ricoh racketeering investigation by the department of justice? Are they concerned they could be indicted into the rico conspiracy or are the mainstream media preparing themselves for an imminent squeeze so that when amc and gamestop do squeeze, they can say guys? We told you so we've been putting out positive amc articles forever. We predicted the squeeze last year. We've been posting positive articles all of this time.

Just look at this positive article right here that we posted a few days ago, then what we full post this article saying the struggling movie theater chain, is bouncing back from the struggles caused by the pandemic and the street actually went on to talk about gamestop and The shorts are running out of available shares to shore and they said with short interest on the rise. Short sellers need to be more resourceful to continue. Betting against gamestop shares. The street is even talking about the utilization rate at maximum levels for 21 consecutive days.

A quote from the street itself says: according to ortex data, it's been more than 21 days since gamestop utilization rate stood at 100. If correct this rate implies there are no more shares available to be lent for shorting. Thus, theoretically an eventual buy-in can occur if lenders decide to recall those shares. This may cause a short squeeze, so it seems like citadel and point 72 are readying for an imminent squeeze by withdrawing their investments from melbourne capital and the mainstream media is also preparing for that imminent squeeze by posting positive article after positive article, but interestingly bloomberg in The sec seems to also be trying to ready everyone for that squeeze as well.

There was five separate headlines posted by the bloomberg terminal today, saying ussec urges broker-dealers market participants to remain vigilant to market and counterparty risks amid heightened volatility and global uncertainties. They also said that broker dealers should collect margin from counterparties to the fullest extent possible. Concentrated positions of prime brokerage counterparties pose particular concerns. Broker-Dealers must seek data to determine counterparties, aggregate positions and the staff are urging broker-dealers to stress test positions with the proper severity.

In light of current events and finally, the sec is urging broker-dealers to monitor risk management limits closely intraday and escalate any breaches to senior management. Therefore, it seems like the sec are trying to prepare market participants and broker-dealers for a very large incoming movement they're, trying to help prevent as many of these market participants from being liquidated as physically possible. Obviously, when amc and gamestop do squeeze, we know that a number of long hedge funds will be okay, but we know that a specific number of short sellers will end up being liquidated. The sec also issued this statement today from the division of trading and markets, urging broker-dealers and other market participants to remain vigilant to market and counterparty risks that may surface during periods of heightened volatility and global uncertainties.

Now, interestingly, in the recent fed financial stability report, they said specifically that meme stocks could cause heightened volatility and present a massive amount of uncertainty to financial stability, literally taking the exact words used by the sec. In this statement issued today, as corey says, this seems quite literally like the last call or the last warning, before those margin calls end up going out and for acorn, also tweeted, saying jon. Stewart is now calling for the sec to throw ken griffin citadel securities out of the stock market. Now, while i do think citadel securities are definitely part of the problem, they're, not the entire problem, all on their own, while citadel securities do facilitate the creation of synthetic shorts and likely hold a number of synthetic shorts for themselves.

There's also a number of other short hedge funds that are requesting citadel to create those synthetics if citadel ends up being kicked out of the market. I'm sure a number of these short hedge funds will just locate another market maker, like virtue to create them. Those synthetic shares personally, i think, the only real way to ensure that all of these corrupt short hedge funds, end up being kicked out of the market at the exact same time, is to allow amc and gamestop to squeeze when amc and gamestop end up squeezing all Of these short, hedge funds will be liquidated all at the same time and will effectively all end up going bankrupt and won't be able to trade any longer, and maybe this is exactly what the sec is planning. The sec is warning those prime brokers to ensure they collect all of their margin, from counterparties to the fullest extent possible, before allowing the amc in gamestop squeezes and effectively kicking out all of these short hedge funds, if the prime brokers request and collect all of their Required margin to the fullest extent possible.

It should protect a number of those prime brokers and ensure that they don't end up going bankrupt and being liquidated, while the short hedge funds do. Everything seems to be falling in line for an amc and gamestop squeeze and for melvin to end up taking the majority of the blame and being the full guy. Citadel and point 72 have withdrawn their investments and therefore are likely preparing themselves for the squeeze. While preparing melvin to take the blame, the mainstream media is also preparing for the squeeze by printing tons and tons of positive articles so that when amc and gamestop does squeeze, they can say that they were right all along and they knew the squeeze was coming and Again, the sec and the department of justice also seem to be preparing for the squeeze by warning.

The majority of market participants guys be sure to. Let me know down in the comments below what you think about point 72 withdrawing from melvin and whether you think the squeeze could be imminent and as always guys, if you enjoyed this video, be sure to check out some of my others. Alternatively, subscribe the channel and ding that notification bell, because that way, you'll be alerted. When i upload a new video cheers.