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Who made those accusations, and what evidence did you see? I've only seen those accusations on reddit and twitter. The only "evidence" I've ever seen in suppor

Who made those accusations, and what evidence did you see? I've only seen those accusations on reddit and twitter. The only "evidence" I've ever seen in support of those accusations is repeated citation of short interest. Short interest is an aggregate figure which doesn't track specific firms, so it can't be used to discover if an individual fund closed or opened a short position.

x3n0ph3n3 6y ago
There's no actual evidence of those short positions actually being closed, other than vague language indicating that it would happen.
- fractionalhare 6y ago
  Well there's the evidence that any firm short at $20 would have been dead if they didn't get out before $200. I'm only aware of one firm that went bankrupt, and it wasn't Melvin or another major fund. Put yourself in the firm's position and think about this from a game theoretic perspective...what is the upside in lying? The thinking is that you might convince people to lay off the voracious buying if you make it seem like the short squeeze isn't possible because you're out? That seems like a stretch and would require navigating lots of wild assumptions about why this almost unprecedented price action is happening. On the other hand, there is tons of downside. If the plan doesn't work and the price continues its meteoric rise, you're bankrupt. If you're caught lying, you're additionally hit with securities fraud. Then the veil is pierced and the partners are at risk of losing their money. On top of this if your investors are savvy they'll sue you for breaking fiduciary duty because you didn't close out a position that makes selling naked SPY calls look safe. This also puts the partners' private capital at risk. It would be cartoonishly dumb to lie about closing the position instead of actually doing it.
  - thebean11 6y ago
    What's your math on that, considering Melvin's multi billion dollar bailout?
    - fractionalhare 6y ago
      Their AUM was around $13B at the beginning of the year. They were short at $20. As was reported, they lost about 53% of that, call it $6B, as GME rose from $20 to $100, which is when they said they closed out. Their AUM wouldn't be able to survive $100 - $200 given their losses going from $20 - $100.
thebean11 6y ago
> Who made these accusations Random redditors, and they were quoted by CNBC and the like The post I replied to asked what people are demanding. They are demanding that institutions not lie to manipulate the market. I am not claiming this lying ever took place. > The only "evidence" I've ever seen in support of those accusations is repeated citation of short interest. In addition to that, they claimed that volume in GME was not high enough for the shorts to be closed. I'm not familiar enough with the markets to know what I don't know here though.
- gruez 6y ago
  >In addition to that, they claimed that volume in GME was not high enough for the shorts to be closed dark pools/OTC trades, maybe?

x3n0ph3n3 6y ago

There's no actual evidence of those short positions actually being closed, other than vague language indicating that it would happen.

fractionalhare 6y ago
Well there's the evidence that any firm short at $20 would have been dead if they didn't get out before $200. I'm only aware of one firm that went bankrupt, and it wasn't Melvin or another major fund. Put yourself in the firm's position and think about this from a game theoretic perspective...what is the upside in lying? The thinking is that you might convince people to lay off the voracious buying if you make it seem like the short squeeze isn't possible because you're out? That seems like a stretch and would require navigating lots of wild assumptions about why this almost unprecedented price action is happening. On the other hand, there is tons of downside. If the plan doesn't work and the price continues its meteoric rise, you're bankrupt. If you're caught lying, you're additionally hit with securities fraud. Then the veil is pierced and the partners are at risk of losing their money. On top of this if your investors are savvy they'll sue you for breaking fiduciary duty because you didn't close out a position that makes selling naked SPY calls look safe. This also puts the partners' private capital at risk. It would be cartoonishly dumb to lie about closing the position instead of actually doing it.
- thebean11 6y ago
  What's your math on that, considering Melvin's multi billion dollar bailout?
  - fractionalhare 6y ago
    Their AUM was around $13B at the beginning of the year. They were short at $20. As was reported, they lost about 53% of that, call it $6B, as GME rose from $20 to $100, which is when they said they closed out. Their AUM wouldn't be able to survive $100 - $200 given their losses going from $20 - $100.

thebean11 6y ago

> Who made these accusations Random redditors, and they were quoted by CNBC and the like The post I replied to asked what people are demanding. They are demanding that institutions not lie to manipulate the market. I am not claiming this lying ever took place. > The only "evidence" I've ever seen in support of those accusations is repeated citation of short interest. In addition to that, they claimed that volume in GME was not high enough for the shorts to be closed. I'm not familiar enough with the markets to know what I don't know here though.

gruez 6y ago
>In addition to that, they claimed that volume in GME was not high enough for the shorts to be closed dark pools/OTC trades, maybe?