Eregulla Deeps, page-238

"The shorts convert to stock.. "

I'm going to do a Pauline Hansen and ask you to please explain cos I am confused as buggery with that comment. How do you convert a net open sold position of 10% into actual stock??? That's like saying I can go from a net equity position of -100mn (essentially net debt of 100mn) to a net equity position of +100mn (net wealth of 100mn) by somehow magically converting my debt into double the amount of money (not only do I have to magically wipe out the 100mn of debt to zero, I have to magically create 100mn on top of that).

If someone borrows 1mn shares and short sold it, they will need 2 million shares to turn that 1mn short to 1mn long. And how is that created? Pretty sure this has been discussed before. No of shares on issue can't randomly be created out of thin air by some random arbitrary person sitting in a dark room somewhere...

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