The run to $900 in early Jan was no "
momo move"; Momo doesn't cause a further 30% gain in 8 days, 17 days after the event.
No, the move to $900 was a short covering rally; MMs had sold short about 40M+ shares by the end of Dec 2020. That $900 SP is what was required for long term holders to actually hand over that volume of shares (Ron Baron's fund sold too early in Dec at ~$640, haha).
A simple supply'vs'demand economics model predicted the Jan SP peak given short interest data as of Dec 31, 2020.
Don't trivialize that fact that those shares were largely sold to S&P 500 Index Funds (this is a crucial difference vs Aug 2020). These are organizations who
will not accept a mere Broker's promise that they hold their shares. Large Funds are actual
Beneficial Holders of the shares they own, and thus their ownership is
registered in their name with Tesla's share distribution agent.
No group pooling scams were possible in Jan 2021, like happened to many Retail investors here at TMC upon the Fri, Aug 29, 2020 share dividend. Some retain investors didn't receive their rightfully owned shares in their accounts until Thu, Sep 3, 2020 or even later. In the mean time, they were denied access to their legally owned shares. What did that cost, you ask?
These retail shareholders were unable to trade 80% of their shares while the SP plunged, beginning in the Pre-market on Aug 31, 2020 ($538 @ 7:01 when Tesla announced their $5B share offering, giving shorts an escape hatch from the ongoing squeeze). SP plunged over 14% to $470 by 10:00 am. That's the power of a short squeeze, and the effect when the buying pressure is relieved: (the effect? Retail holds the bag)
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In 2021, any counterfeit shares sold to Index Funds would be easily detected ; Funds would sue any MMs or Hedgie that performed their usual
'fail-to-locate | short-sale | fail-to-deliver' kabuki dance. That's why the SP marched up to $900 in early Jan 2021; because MMs and hedgies HAD to locate and purchase real shares. It's called the
law of supply and demand, and it's how the Markets are supposed to work.
Instead, legalized naked short selling by Options Market Makers (via SEC Reg. SHO, a.k.a. the "
Madoff exemption"), allows the priviledged few to violate the law of supply and demand, and has artificially depressed TSLA's share price for years (except for brief breakouts). And the situation is not getting any better: as TSLA market cap increases, more MMs are piling in with their manipulation games. It's literal free money to them, and almost without risk since the SEC has turned a blind eye on MMs behaviour, it's long-term damage to both retail investors, and to the Market itself.
In the meantime, MMs and Hedgies play fat, dumb and happy. That is, until the next round of share dividend induced panic-buy-to-cover-shorts they've hidden since February as the SEC snoozes. This level of manipulation and white-collar crime can not continue, and will not end well. Who will break first?
The situation is ridiculous, embarrassing, and routinely ignored in polite society of NYC.
#GAMESTOP
insideevs.com
