You don't seem to understand the $2.50 rule - you keep posting that everyone has $2.50 - and you have hopelessly not understood what the $2.50 rule means.
"its downright impossible. Its unimaginable. no one has $2.50. just nphc hogwash conspiracy."
Let me explain it once again.
The $2.50 rule applies when you are short selling stocks that are priced under $2.50. Basically, the rule states that for every share you are short, you still need to put up $2.50 of capital, even if the stock is priced lower.
It is a margin requirement.
The average investor can't or it is extremely difficult to short a penny stock - the margin requirements are just cost prohibitive. You have to have $2.50 margin per share to short a stock under $2.50. It just isn't economically feasible.
The good thing is you won't get a margin call unless it gets over $2.50.
MMs do not "short" penny stocks. As part of making a market, they may have periodic short positions throughout a trading day if they fill buy orders for more shares than they have in inventory, but they also often have inventory when they fill sell orders. Having an inventory does not mean that they are going "long" any more than having a temporary net short position is "shorting." This kind of temporary short position is legal and necessary for efficient trading.
The FINRA daily short data does not show true short positions and that the Bi-Weekly report is the only reliable one. It also explains that when new shares are entering the market, they are reported as short until the stock is delivered.
The short data for all OTC stocks including those quoted on OTC Markets (fka Pink Sheets) is sent to FINRA twice a month by broker/dealers. FINRA compiles it and publishes a semi monthly report. These bi-weekly reports show the aggregate short position by all market makers as of that settlement date.
IG
"The Hour Between Dog and Wolf"
