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A comment on Naked shorting: The curious incident of the shares that didn't exist (2005). Parent comment

Re:Naked shorting: The curious incident of the shares that d... by rptr4 on Monday February 01, 2021 @02:15AM (#25986383)
I’ve seen that explained on WSB. I don’t think there’s much confusion about it. Nonetheless, SI being that high will inevitably drive the price up to unwind, and take quite some time to unwind. The evidence of naked shorts (which Market Makers are permitted to do to enable liquidity) seems primarily based on FTDs.
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Re:Naked shorting: The curious incident of the shares that d... by vlovich123 on Monday February 01, 2021 @02:39AM (#25986476)
What happens if a market maker fails to deliver the promised stocks due to inability to purchase stocks? Penalties to the government?
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Re:Naked shorting: The curious incident of the shares that d... by JumpCrisscross on Monday February 01, 2021 @03:18AM (#25986661)
> What happens if a market maker fails to deliver the promised stocks due to inability to purchase stocks?

Unless volume is zero, there is no “inability to purchase stocks.” Just inability at a desired price. If a market maker fails to deliver, they get hit with fines and fees from clearing infrastructure, exchanges and, eventually, the SEC.

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