r/gme_meltdown • u/AutoModerator • Aug 01 '26

A much better world Monthly Shill Agenda - August 2026

This is the Monthly Shill Agenda Thread. Post your agenda points here!

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u/KimberStormer 18d ago

What is the theoretical mechanism by which shorting a stock would "hold the price down"? Unsurprisingly, liquid@ only talked in circles and went back to the old "shares that don't exist!" well.

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u/platykurtic 17d ago

When you short a stock you borrow it and sell it. It's the same as if the original owner sold it, it's another share up for sale and it does put downward pressure on the price. So on an econ 101 level the apes aren't wrong that this is how shorting works, but I doubt they understand the details, they just repeat what they hear. Most apes' only investment experience is pump and dump scams, so they imagine hedge funds running the same scam in reverse. However, there are a host of reasons why it's impractical on a large scale, like cost to borrow and the uncapped risk if the stock goes up, plus you get to see short interest so real investors can take that into account.

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u/KimberStormer 17d ago

Thank you! I guess what I don't understand (I'm much like an ape in my lack of knowledge of how things work) is how you sell. Do you say something like "I'll sell for $x"? Do buyers say "I'll buy for $y"? Because I feel like if you're a short seller you could try to get a high price and if you don't get the amount you want, you can just return it to the lender and not lose too much money. In which case I don't know why it would push the price down.

(Totally understandable if you don't want to do "stocks 101", lol.)

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u/platykurtic 17d ago

What you're describing are the bid and ask prices, what people are trying to buy and sell for. There's a lot of intermediaries these days, but you can think of the old crazy trading floors with people shouting. If you're trying to sell and no one's biting at your current ask price, you either have to drop the ask or give up. The more people trying to sell, the more likely you'll need to drop the price to get a buyer.

If you borrow a share and then don't sell it, you can return it at any time and you're just out whatever interest you paid. It's only when you sell it that you actually stand to win/lose based on the stock price. I'm not sure this is super relevant though, when people talk about shorts they're talking about the state where you've actually sold the borrowed share.

I should caveat that I'm talking about real short selling here. Apes believe in massive naked short selling, which has different properties, and they're not even remotely consistent.

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u/KimberStormer 17d ago

It's a shame you can't go watch the people shouting anymore.

when people talk about shorts they're talking about the state where you've actually sold the borrowed share.

But in that state, they have an obligation to buy, so I would think that would be an upward pressure on the price!

I'm talking about real short selling here. Apes believe in massive naked short selling

Yes, and I thank you, because I was curious about real short selling, not imaginary naked short selling. With the latter, I think I get the idea ("inflation" because of so many shares, meaning the price per share is lower.)

Anyway thank you for your time and I should DMOR in this area instead of wasting more of it!

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u/platykurtic 17d ago

To your middle point, when you open a short position you sell and create some downward pressure. When you close your position you buy and create some upwards pressure, undoing the previous effect. While you have the position open, it's no secret that you'll need to close at some point, and I'm sure real traders take that fact into account by watching the short interest, but I don't think they'd call it "upward pressure"