hope it rally today, page-30

"You go to a bakery and borrow someone else's bread that they have paid for."

Of course. How do you borrow something of value that *someone* hasn't paid for? If no one's paid for it (or spent money producing it), the item will be worthless and not worth borrowing.

'The bakery doesn't tell the real owners of the bread that you have taken it."

The owners are aware. There will be a clause in institutional documents that informs owners that their shares are viable to be lent out.

"You then buy back stale bread (its now not worth as much) and give it back to the bakery."

Your above two comments were on the silly side, but this one's DEAD wrong. You don't give back stale bread, in this hypothetical scenario you're giving back the exact same bread in the exact same condition. The only difference between the loaf you took and the loaf you're giving back is that the latter loaf is *Worth* less on the free market.

Let's just say I short 0.01% of FMG and a month later the price falls a bit and I'm about to cover. I'm repaying my debt of 0.01% of FMG, exactly what I borrowed in the first place. The shares I'm returning aren't difference in any way at all, they entitle me to the same portion of the business in every way. The only difference is that the public has applied a lower MONETARY value to the same proportion of the company.

"buy back in off market thus never having to worry about short squeezes."

Liquidity is VERY low off market. You need to do more research on this - to cover large positions, you'll only ever get the liquidity by trading on the open market. You see short squeezes everywhere when shorters have gotten it wrong.