Fannie Mae-No Politics (FNMA)

[chessmaster315]

Why what happened to Gamestop can happen to FNMA:



Summary of what happened to Gamestop. Someone on reddit noticed that 200 percent of Gamestops shares were shorted.

The main shorter was Melvin Capital. Gamestop was about 17 per share.
After Elon musk recommended "buy Gamestop" the shortie was burned, and lost 5 billion dollars

Since Melvin capital had virtually more than 100 percent of the shares shorted, when it started to rise, Melvin capital had to pay pretty much anything the owners of the shares wanted. Some shares sold for over 400 per share.

That is the good news. Now for the bad news. Melvin Capital is an "accredited investor" and they can do things we can not. They managed stop the trading on Gamestop on TD Ameritrade and Robin Hood.
This means that retail investors of this firm could not take advantage of Melvin Capital's short squeeze. Had this not happeneed, Melvin Capital could have lost 15 billion or more, and this money would have gone into tdameritrade and robin hood clients smart enough to profit burning the shorts.

The brokerage firms supported Melvin capital by not allowing retail buys of Gamestop. THIS is a breach of fiduciary duty..these firms are to represent their clients not fellow accredited investor buddies.
sources:
and https://www.independent.co.uk/news/business/gamestop-share-price-reddit-hedge-fund-melvin-capital-b1793543.html

Sources: https://www.independent.co.uk/news/business/gamestop-share-price-reddit-hedge-fund-melvin-capital-b1793543.html


Now, THIS CAN HAPPEN TO FNMA, and why:
FnMA allows naked shorts. This means shorting fannie has huge volumes. If FNMA becomses a "target" of overshort buyers, FNMA could surge to hundreds of dollars per share, just like Gamestop.

Shorties, like donuts, taste best when deep fried. The same people who burned Melvin Capital for overshorting Gamestop are out looking for their next "overshorting" victim, and they are flush with 5 billion dollars of Melvin Captials money.