[trident5000]

A few thoughts here.

First, the short sellers getting taken to the wood shed absolutely deserve it for placing such an idiotic bet. The short positions outstanding are 150% of the available shares even today. Its a short squeeze even more than its WSB pumping it. And apparently the short sellers just keep coming back for more. They can play that game if they want and I dont feel bad that they lose all their money.

Second, theres no such thing as "short seller pressure". The act of shorting does not lower the price of a stock mechanically. You could argue they are forming a negative narrative but I would call that fair game. You're allowed to say a business is crappy.

Third, WSB pumping and dumping stocks is scammy and definitely not good for the markets. Thats just a mechanism where the early pumpers clean out all the idiots who follow their trade.

[ISL]

Agreed on all but the second point. Short-selling definitely does push prices downward in the short-term.

Suppose you own a share that you don't want to sell and are willing to loan it to me for a month. I'll have to give it back to you, as well as interest payments in the interim. I can sell that share today, which will push the price down. My entire bet is that I can buy your share back in less-than-a-month for substantially less than that for which I sold it.

If I am wrong, I will have to repurchase the share at or before the end of the month at market-price, restoring the number of outstanding shares to where they were at the beginning.

[invisible]

I agree with your points but it should be noted for the second point: they are doing more than just saying a business is crappy. They are betting billions on that business being perceived negatively. In essence, they are throwing their weight behind suggesting that the financials of GameStop are poor. They are betting that the average investor will see those negative signals and that, on average, the stock will do poorly.

[Supermancho]

> First, the short sellers getting taken to the wood shed absolutely deserve it for placing such an idiotic bet.

The bet was good. A lot of companies are doomed to contract drastically. The problem is that someone found out about this specific bet and rallied others around it.