@originalmarkz: Lots of political pressure on settling naked shorts. Things are heating up for our politicians!! Now THEY are responsible for their actions.
Definition of 'Naked Shorting'
The illegal practice of short selling shares that have not been affirmatively determined to exist. Ordinarily, traders must borrow a stock, or determine that it can be borrowed, before they sell it short. But due to various loopholes in the rules and discrepancies between paper and electronic trading systems, naked shorting continues to happen.
While no exact system of measurement exists, most point to the level of trades that fail to deliver from the seller to the buyer within the mandatory three-day stock settlement period as evidence of naked shorting. Naked shorts may represent a major portion of these failed trades.
[spirit156] Hi Is MarkZ referring to currency trading or some other stocks? I read the link.
[BigDog-OH] spirit156 Applicable to any asset
[spirit156] BigDog-OH So if the pressure is one "settling" naked shorts, then it means the "debt" is being called due. And if it is currency, then it must refer to their early trading??
[BigDog-OH] spirit156 I think you are close. The term is used when the seller really does not have the asset that they expect to lose value, borrows it from someone that will lend it to them, they sell it to another investor that does not know that it is shorted and then the seller expects to buy it back from the purchaser at a lower rate so that they can return the asset back to the original holder
[mellon] Naked Short is when you sell a stock or comodity you don't own or have the stock to deliver hoping it goes down and then you buy it to deliver at a lower price
[mellon] making the spread
[mellon] BigDog-OH naked means they don't even borrow before they sell
[mellon] highly illegal but still goes on all the time
[BigDog-OH] mellon Right... the "Naked shorter" is getting the asset from someone who owns it and is betting on it to reduce in value
[mellon] BigDog-OH from what I understand that is why it is called naked. They don't borrow but sell with out a cover such as the borrowed stock
[spirit156] BigDog-Oh Can we relate it to currency more specifcally and does it refer to the early exchanges that were going on in December and January?
[BigDog-OH] mellon Right
[mellon] process kills small companies. lots of shorting crushes stocks and scares out small investors so there is no support and price drops fast then shorters buy cheap to cover
[BigDog-OH] spirit156 Could happen with currency but I don't think it has much to do with the unconfirmed early exchanges you referenced
[mellon] I wonder if MarkZ is refering to early sales at high prices politicians supposedly did. But they could easily cover by going to dealer.
[mellon] confused as to where the short comes in. Weren't we told they were sent to dealers to buy for their exchanges?
[BigDog-OH] mellon I find it hard to believe that he is referencing it in regard to Dinar exchanges
[mellon] BigDog-OH Well if it has to do with the market, they are screwed since the market is up
[BigDog-OH] mellon the 1166 value really hasn't changed so I would think it would be hard to short the currency
[BigDog-OH] mellon True, but there was a killing made when the market plunged
[mellon] BigDog-OH I saw that Soros was shorting S&P
[mellon] BigDog-OH but if they didn't cover they are stuck
[BigDog-OH] mellon Yeah I saw that too. He is the master of shorting the market
[Grandpa10] BigDog-OH I agree with you, I believe MarkZ is refrencing dealings that have been going on with our represetatives and thier illegal actions, not dinar related
[BigDog-OH] mellon Yep
[mellon] from wiki: Naked short selling, or naked shorting, is the practice of short-selling a tradable asset of any kind without first borrowing the security or ensuring that the security can be borrowed, as is conventionally done in a short sale. When the seller does not obtain the shares within the required time
[Mark mc] I hope MarkZ saying there under pressure because the Dinar is moving up in value and will expose those that have been shorting the market. Soon
An explanation of MarkZ's "Naked short" tweet
Ok room I’m going to take a stab at explaining what MarkZ’s tweet was trying to say. In the investing world a “Naked short” is a method for an investor to profit from the “downward” movement of an investment such as a stock.
Prudent investors will most times do this in a “covered” basis meaning they have own stock of the stock that they wish to “short”. Thus a “covered short” so that if the investor guessed wrong in the stock’s movement (stock price rises instead of falling) he can put up the shares of against these losses and therefore mitigate his losses.
In this scenario the investor who does not have the stock to put against the losses is referred to as a “naked short” and therefore theoretically is exposed to an unlimited losses (ouch!!!).
Markz”s analogy makes suggests that some politicians and their questionable behavior may have exposed them to limitless liability.