Hedge funds typically buy on margin so when they 'borrow' the 100 shares, they are only required to have a fraction of the amount borrowed in their account (either in cash or other securities) essentially to guarantee the broker doesn't get stuck holding the bag. They have to maintain this margin ratio (i.e. percentage of the position) whichever direction the stock is going.

When there is a rapid increase in the price of a stock they have shorted, they will no longer meet the margin requirements. So they either need to deposit more funds/securities to keep the position going or start buying back shares to get back in line with their margin requirements. However, if the fund is maxed out on their positions buying back shares often just helps raise the price further causing them yet another margin problem... it's a downward spiral. Plus, once other hedge funds smell 'blood in the water', they'll start piling on too (i.e. buying shares raising the price further) knowing that the fund(s) that are in trouble have no choice but to cover their short position regardless of the price. That's part of why you'll see these gigantic price spikes.

You don't have to have over 100% but you do need a significant amount. For a squeeze to occur you have to have 1) some initial upward price movement and 2) enough short interest that as people get uncomfortable with the increased downside (or their broker calls them on their margin), they have to buy real shares to close out their short positions, thus increasing the upward pressure on the price. That drives the price higher, and causes more people to get uncomfortable and more margin calls to be made, driving the price even higher. Other people notice the price and trade volume going up and want in on the action, which drives the price even higher. This cascades until there are no more surviving short positions.

The whole thing about borrowing 200 cows is illustrating the concept of leverage, but it isn't necessary. We could have illustrated the concept of a short squeeze by saying the hedge fund borrowed 50 cows, and a Redditor noticed and bought 51 cows. When the hedge fund needs to close their position there are only 49 cows available and the Redditor can ask an insane amount of money for the last cow. And that isn't even really how a short squeeze works (see top paragraph).

A squeeze can happen with any amount of short interest. But if it's a tiny amount it will be swallowed by the other random noise in the market, and won't cascade into a giant news story. Gamestop had right around 150% short interest in December. The other crazy thing is not just the number of shares shorted, but what prices they might be at. The 50 day moving average is about $30. If you shorted at $30, you had a 500% downside yesterday. If you still weren't forced to close your position then you were at 1000% downside today. The one year low is $2.57. If you shorted any sizeable position at $2.57 you're probably thinking about jumping off a skyscraper.

You don't need to borrow more than 100 cows, the short squeeze of Porsche/VW had a much lower short interest because the shares were all tied up in institutional holdings.

Well over 100% of GME’s float was short.

150%