Interesting links. I'm aware that naked shorting occurs -- but from my limited understanding of the intricacies involved, I believe that MMs and hedge funds are responsible for most of that. I don't think the US Treasury has daytraders naked shorting stocks, if that was the claim being made. I am aware that Paulson gave a few select hedge funds insider info on the government takeover of FnF back in 2008. That's despicable, but still not the same as the US Treasury naked shorting a stock.
I was most interested by the link you provided about the emergency act that was enacted that temporarily put a stop to naked shorting for a month or two. What was the reason for them taking a stand to prevent the naked shorting? And why did they let the emergency act lapse? And why was it only enacted on certain stocks, and not across the broader markets?
One thing I don't understand is that my brokerage has lots of FnF shares available for shorting. Not that I would ever go short on FnF -- you could go bankrupt overnight -- but why do people naked short when even a lowly retail trader such as myself has access to all the FNMA shorts you could desire?
Sorry, didn't mean to bombard you with questions. I'm just interested in learning more about the behind the scenes stuff to help inform my trades. All I have to say is if there are naked shorts right now they are gonna get totally crushed tomorrow imo. I hope a lot of people shorted at 4.50 so we can squeeze the *$@! out of them.
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