/biz/ - Business & Finance

>>50569732
>It's confirmation that they shorted sometime between Friday and today and needed to deliver on soon-to-be FTDs. They can then fulfill the borrowed shares with an actual FTD that's done through ex-clearing with a collaborating broker who is willing to accumulate toxic positions via non-delivery, FTRs/FTDs that happen via off-exchange purchases are not included in FTD statistics but rather are private contracts between the buyer and seller of the security. So long as you have a collaborating broker-dealer (such as loop capital) they can stack themselves with FTRs without any reporting requirements. REFCO did this for decades until it exploded on them in 2005. Market makers snipe the real buy orders with naked shorting, the naked short is delivered via a borrow, the borrow is then itself delivered via ex-clearing. The accounts receivable side now sits on the cooperating broker-dealer's balance sheets like an asset, and the securities sold but not yet repurchased sits on the market makers balance sheet. This is how they maintain extremely long-duration naked shorts. As far as the DTCC is concerned this method is a delivery in full because all market participants are happy and they've all got their shares 'delivered', but they ignore that the system just got flooded with shares and there's a toxic debt bomb out there on the ex-clearing side sitting on some company's balance sheet.