They are not shorting the stock themselves. The scenario...

They are not shorting the stock themselves. The scenario discussed above was whether they might lend shares to short sellers.

To me I can't see any reason why they would "trash the stock" as you say. There is simply no benefit in it to them.

Lets say hypothetically, they lend 20% of their holding (or 1% of A2M's overall shares) and that goes on to be shorted.

1) If the SP decreases, the shorters profit whereas Vanguard would see a decrease in the value of the other 80% of their holding. This would far outweigh what they make in lending fees/interest etc

2) if the SP increases, Vanguard profits on their main holding + still rakes in the interest /borrowing fees.

Explain to me why on earth they would prefer outcome 1 over outcome 2 - it would make no sense.