[quantgenius]

107% of available shares being shorted is NOT a physical impossibility. Let's say there are only 10 shares of OSTK outstanding. I own them all and make them available for borrow by short sellers. Short sellers borrow all 10 and sell them. I buy 1 of the 10 shares shorted. I lend that out too and it gets shorted. Now 110% of all issued shares have been shorted. Nothing impossible or illegal here.

This is a situation that would be EXTREMELY unusual because it's very, very dangerous for the short sellers. I could recall all my lent out shares and unless I sell one of the shares I own there is no way for the short sellers to deliver so the price will spike into the stratosphere due to a short squeeze.

The fact that short sellers were willing to short stock despite the massive short interest (which is a publicly available number) means the market as a whole believed that OSTK was wildly overpriced, which in hindsight it was.