Presumably the crash would occur after the GME price skyrockets and shorts (and then their brokers and clearing houses) go broke trying to close the short positions.

The insurance pays up if they buy your share.

Do you have another idea how it could end?

It could end by simply crashing without shorts going broke. There's not much reason to believe a larger short squeeze is forthcoming.

Why would that crash the entire stock market?

The theory I've seen is that there could be hidden systemic risks here. If GME tanks suddenly, there's some possibility that traders bailing out of their trades will take down Robinhood (who doesn't seem to be very healthy right now), and a major broker collapsing is never gonna be great for the market.

I share your skepticism that it would actually happen this way, but it seems at least somewhat plausible.

Robinhood are tiny on the brokerage stage. Important to retail, barely matter otherwise. That’s my understanding at least

That seems consistent with what I've read recently. Good news.

It's got nothing to do with Robinhood. If a hedge decides to cover the short so they don't have to admit defeat and go bankrupt, then the entire market goes down because they'll end up selling thousands of unrelated shares for their cover.

You've fallen victim to some common misinformation that's spreading. Multiple hedge funds have already been able to cover their shorts, and there's not much reason to believe this will change.

Not an endorsement but this was retweeted by Kai Ryssdal: https://twitter.com/TheStalwart/status/1355531873896824834

> Are you under the impression GME wouldn't crash right alongside the market?

Well ... yeah. Today it hasn't.

We all know why it hasn't. Do you really believe it will last forever? or even 6 months from now? People are trying to make money. Once the momentum slows down the big sell off will start and nobody would be able to stop it. Not DFV or even the biggest troll of all, mr. Elon Musk.

Forever is a long time. No, I do not believe it will last forever, or even six months.

I do believe it will last at least one more week, though, yeah. And I'm putting money where my mouth is.

The best part in all of this is that you're free to short it if you disagree. See where that leads you.

So you basically agree with me. You still wrote your last paragraph. That is because you're invested emotionally in this.

Never shorted a stock in my life. Not going to start now. I cannot predict when this will stop. Nither can you. What currently holds everything together is the unknown. People don't know who, when, and how the shorter s are going to close their positions. Once things will clear out I predict it's gonna be the beginning of the end.

Just to be clear. I don't think it will crash to nothing any time soon. It will keep trading much higher than what it was pre this saga. When I say crash I mean down around 70-80% from its current value of $330.