” buying creates excess counterparty risk, but selling doesn’t, WHO’S ON THE OTHER SIDE OF THE TRANSATCTION? ONe hand can’t clap. Somebody has to buy the trade.
This is the part that’s been bothering me for a few days now. Do they mean you can put up for sale, but allow no buyers? So the only effect is to drive the price down.”
The only thing I can figure is that the counter party in this case is the clearing house itself. There are not two parties to a trade but three - the seller, the clearing house and the buyer.
Because Citadel sold and/or lent stocks they didn’t have, now they are desperate to buy them at ridiculous because the prices are going to get even more ridiculous.
I’m pretty sure they didn’t block all purchases. It looked like they only blocked them for some customers - the ‘common folk’. They went right on selling any stocks they could get their hands on to the institutional buyers.