Imagine there are only two shares GME.
You buy two GME for $1ea. Two short sellers needs 1 GME each lest they hemorrhage money on fees. You loudly announce your plan to hold half your GME forever. The short sellers trip over each other to pay you stupid money for the one GME you are selling. You then sit on the other GME for awhile, maybe sell it in a year or two for a buck. In any case despite buying two and selling one you've made a ton of profit.
Now scale this up to several million people.
And many more shares, most of them hold by corporate and institutions (some of those institutions will be happy to lend shares as well). Also more shares can be issued.
There's so much discussion on HackerNews today about people who are going to lose out on these stocks where I've seen a healthy amount of comments on Reddit in the last week of people buying stock merely "for the lulz". I think there's a non-insignificant amount of "investors" who have tossed paltry sums at $GME with no plans on making a return.
Honestly, I'd have done the same, but I don't do any form of stock trading so I don't have accounts on any platforms to do it. I've done the same with various crypto shitcoins and made a few bucks off throwing $50 or $100 at something I don't expect to ever see return on too.
That's my understanding. What happens afterwards? No ideas. Some people want to see hedge funds burn, I would not mind that either.
Nobody is going to make the hedge funds burn. At this point the hedge funds are fleecing whoever was buying shares or options yesterday (who do you think they bought them from?).
if the stock price is higher when they borrow and sell, and lower when they buy and return, they make a profit equal to the difference. they lose money if the stock price goes up. all these people buying GME and driving the price up will hold GME stock, and the shirt sellers will be forced to purchase back the stock at premium prices. even if the stock price goes down slightly, the people buying up all the GME will still profit.
but more importantly a lot of people's goal is to f over a major firm that constantly over leverages itself.
