alvan chow:so i tried to look for a historical precedenton what would happen if somethingwas over 100% shorted, but there was nothing. stock expert:when you sell stocks short, you re betting that the marketis going to go down. and if you re wrong,the stock can go up against youvery sharply, and you have to close thatposition, usually at a loss. so you can see guyson wallstreetbets who knew what they were doing. these guys are smart.they understand, ok, we can get leverageon this thing, right? i know that if we gathertogether, there s a point here at whichwe can really push against hedge funds enoughto force them to cover. we can force the market. we can forcethis stock higher. - all these short sellersbuying back their position drives the stock higher and squeezing outall the short players from the market.that s a short squeeze. - you ve got to bereally greedy to keep shorting gamestop when it was at like $6a share or something.
forcing the market makersto purchase more shares, pressuring shorts to close. institutional investorswill catch wind and join in. gme heads to $400 and we cash out. [music playing] this one is specialbecause we have math and great underlying news.to be clear, this will happen whether ornot we participate, but i prefer usto be a part of history. - it was a verycompelling thesis. i had never seensomething like this before. and you know,i m no stranger to something calleda short squeeze, where all these shorts, they ve got to coveron top of each other, and you know, the price shoots to the moon. but at the same time, it alsohad a huge downside, right? - gamestop announced today it s closinghundreds of stores. reporter:gamestop, the biggest video gameretailer in the world,
[laughs] all the shares outstanding for the companywere basically shorted, which is absurdand unprecedented. alvan chow:so i tried to look for a historical precedenton what would happen if somethingwas over 100% shorted, but there was nothing. stock expert:when you sell stocks short, you re betting that the marketis going to go down. and if you re wrong,the stock can go up against youvery sharply, and you have to close thatposition, usually at a loss. so you can see guyson wallstreetbets who knew what they were doing. these guys are smart.they understand, ok, we can get leverageon this thing, right? i know that if we gathertogether, there s a point here at whichwe can really push against hedge funds enoughto force them to cover. we can force the market. we can forcethis stock higher. - all these short sellersbuying back their position drives the stock higher and squeezing outall the short players from the market.that s a short squeeze.
[music playing] this one is specialbecause we have math and great underlying news.to be clear, this will happen whether ornot we participate, but i prefer usto be a part of history. - it was a verycompelling thesis. i had never seensomething like this before. and you know,i m no stranger to something calleda short squeeze, where all these shorts, they ve got to coveron top of each other, and you know, the price shoots to the moon. but at the same time, it alsohad a huge downside, right? - gamestop announced today it s closinghundreds of stores. reporter:gamestop, the biggest video gameretailer in the world, announced today that it willclose up to 200 stores by the end of the year. - that s pretty sad.- like, it could go bankrupt. that was alwayskind of the bear case. open talenti and raise the jar.
against hedge funds enoughto force them to cover. we can force the market. we can forcethis stock higher. - all these short sellersbuying back their position drives the stock higher and squeezing outall the short players from the market.that s a short squeeze. - you ve got to bereally greedy to keep shorting gamestop when it was at like $6a share or something. because that means if you reshorting at $6 a share, you re only profitingif it goes below $6. it was a post by jeffamazon, where he kind of laid outthe gamestop thesis. - i wrote this post called the greatest short burnof the century. my brother, who s an actor,is going to come and read it for me because it s too cringyfor me to do it myself.