HWF, all brokerage accounts are set up to ensure that such representing brokerages don't take losses incurred by their clients. This is what 'margin calls' are all about.
In the event that a short is over-extended on a position, the broker will automatically sell whatever other positions are needed to cover the call. The broker won't take the loss for a client's stupid mistake. The broker covers his azz first, and if anything is left over, the client counts his loss, if anything is left over, to count.
The thing here though is, it won't be retail shorts caught in a squeeze.
It'll be MMs who filled buy orders naked, believing this greysheet would ultimately die the slow death that 99.9999% of all others do.
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