The Importance of DRS
This was a great weekend for progress. The community has restarted the DRS conversation and I wanted to highlight a great summary on the importance of DRS from u/Eptasticfail :
- DRS removes shares from the borrowable pool of shares. Even if you have margin turned off, your broker may be loaning your shares out to shorts without you knowing as per their terms of service, DRS completely stops this.
- DRS is all or nothing. Either the entire share count is DRS'd or it's essentially like none are. This is important because a lot of shills have been spreading talking points about how it's "done nothing for Gamecock so we shouldn't do it either." It won't have full effect until the whole share count is registered.
- DRS does not necessarily stop shorts from having more ammo. They can continue to use ETFs and swaps as well as rehypothication to print more naked shorts. What it does do is force them to use naked shorts rather than safer shorts that are tied to actual shares.
- Shares that aren't DRS'd aren't in your name, they're in your brokers name. The old addage of "not your keys not your coins" from bitcoin's older days rings true here. Not your shares unless they're direct registered.
- SHILLS FEAR DRS. The last 2 weeks have been filled with anti-DRS posting. Why would this be if the shills weren't coordinating on this talking point? DRS has very few downsides for the person direct registering their shares.
So a little more context on bulletpoint #2. It is a weak argument to claim that DRS isn't working for GME because no one knows where GME would be today if shareholders didn't DRS. We could be at $10 or $5 per share, no one knows. But one fact is if you look at the CTB for GME today, it's at 13.4%.
For the longest time GME had a borrow fee of 0.5%, which was quite perplexing because we saw so much down action since the November 2021 run. Well, GME has had a double digit CTB for quite some time now, which we might be able to attribute to DRS.
But as for MOASS and why GME isn't at its peak or higher with the DRS action, there are myriad reasons for this beyond the scope of time to write or to digest. In a nutshell, to prove naked shorts and phantom shares exist 100% of outstanding shares need to be DRS'd. It's very easy to understand.
If all shares that the company has issued is registered in household investors' name, and the stock still trades, then it proves the market is playing with "fake" shares. We know market makers are supposed to provide liquidity, but there has to be a balance and honest intention or understanding that they can locate the shares they are selling. Well, if all the shares have been DRS'd, there are no more shares to trade. And any other shares left in your brokerage are fake too.