[imtringued]

>Alice owns one GME. Bob borrows the share and sells it to John. John doesn't know this is borrowed stock and borrows it to Lisa. This way way you got two borrows on one stock.

The question is what happens on the "margin". Lets say there are 110 shorted shares. You need to get rid of 11 of them to eliminate the short squeeze (assuming nobody buys the remaining 99 shares to hold them).

Lisa owes 30 shares. She only has to buy 11 shares and then the rest of her shorts will have the potential to be in the money. She could buy one share and return it to the lender. She could now make an agreement with the lender to buy a share for a fixed price from the lender and return it and repeat this 11 times.

The question is, why would the lender agree to this instead of just charging market rate?

In my opinion the lender should be on the hook. By lending out your shares you receive interest payments that cover the risk of a "default" just like a regular bank loan. If the borrower fails to return the shares due to bankruptcy you just lose your share. This would significantly reduce the potential for a short squeeze because the lender would just agree to a share price that does not leave the borrower bankrupt.

[monopoledance]

This is over my head, sorry.

Tho, I think your scenario doesn't exactly mean "mathematically impossible" but rather speculation about the short situation's specifics. The whole situation only exists because the big fishes can deceive and manipulate the market mostly to their liking. I wouldn't bet on them not playing dirty to distort analysis of what's really going on.

Sadly, I didn't get into a broker in time. I literally have no shares in this and just hope wallstreet burns over this one way or the other. Would have preferred to throw 50€ or 100€ into the game just for the education. There will be another crisis for me :)