An Analysis of "The Everything Short"
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| Author       | Source       | 
| :-------------: |:-------------:|
|  [u/enthralled123](https://www.reddit.com/user/enthralled123/) | [Reddit](https://www.reddit.com/r/GME/comments/mi6bb4/an_analysis_of_the_everything_short/) | 

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[DD 📊](https://www.reddit.com/r/GME/search?q=flair_name%3A%22DD%20%F0%9F%93%8A%22&restrict_sr=1)

In this post I am going to expand on the DD done by [u/atobitt](https://www.reddit.com/u/atobitt/) regarding the US Treasury and their issuance of Notes, Bills, and Bonds (yes there is a difference). Also, credit to [u/MediaCorrectness](https://www.reddit.com/u/MediaCorrectness/) for showing me how to add pictures within the text. Let's start off with the basics because the whole reason I started my research was because I had no clue what the fuck their DD meant.

Maturity Dates: How long you collect interest for on your Bill, Note, or Bond.

Bills- maturity dates of a year or less

Notes- maturity dates of 2-10 years

Bonds- maturity dates of 10-30 years

Why does the government issue these 3? The government needs money. They get some from taxes, some from trade, but a lot from issuing these bad boys. Bills, Notes, and Bonds are essentially loans that the buyer gives to the government. If I bought a Bond with a maturity date of 10 years and an interest rate of 1.74% (current), I would get 1.74% of my original investment, payed out every 6 months (different depending on maturity length and type of Treasury Security).

Now let's travel down the wormhole.

An organization called GAO (Government Accountability Office) released an audit on the Schedules of Federal Debt. This report was directed to The Secretary of the Treasury.

Here is a link: <https://www.treasurydirect.gov/govt/reports/pd/feddebt/feddebt_ann2020.pdf>

<https://preview.redd.it/sq2p53uzomq61.jpg?width=1258&format=pjpg&auto=webp&s=f85a6e4f595bfe19b8a87f70e61f7d9a0a83df13>

Something must have happened to cause that big increase. I wonder what happened in late March of 2020... THE DISEASE!!! Once it hit, the US Government took on 4.5 TRILLION dollars in debt. How did they take on this debt? Through Treasury fucking Securities. Remember, this chart shows the debt HELD by the PUBLIC. Another way to word it, is debt STORED by the US government into the PUBLIC. Anytime the government issues a Treasury Security, they are putting themselves into more debt. Not only does the government have to pay interest on the Securities they sell, but also the face value of the initial investment. I'm warning you, this next part is scary, but by the end of this DD, you will be horrified.

So, the above graph is all about debt held by the public, but as smart apes know, the government itself also buys Treasury Securities, actually, they're REQUIRED to.

<https://preview.redd.it/zbxeato4pmq61.jpg?width=1294&format=pjpg&auto=webp&s=fcbdd2592e1b191b5376eab29ae4ae87ca231b58>

See that word I circled? Nonmarketable. Well, that means that the special Treasury Securities that different parts of government buy, Cannot be resold. Hmm... I wonder what percentage of Treasury Securities actually can be sold from one party to another. Us GME apes know what it feels like to have the same shares traded over and over... NO FUN AT ALL. It would be a shame if our beloved Liberty and Patriot Bonds could be exploited in any way.

<https://preview.redd.it/05bzpl98pmq61.jpg?width=1512&format=pjpg&auto=webp&s=2526b6f74345154d3d16f61f6775874de881c67b>

Thats right. 97 fucking percent of Treasury Securities are marketable. The GAO nicely explained it, "they can be resold by whoever owns them". Key word: WHOEVER. If you are a smart ape and kept reading you might have noticed how 64% of these marketable Securities mature within the next FOUR years. That totals up to 13,125 Billion. Hmm... whats 13,125 Billion thats a weird number. 13,125,000,000,000 TRILLION. Wait a second, didn't the 97% marketable Securities equal 20,353 Billion? Yeah, it does. First line. 20,353,000,000,000 TRILLION of marketable Securities are floating around out there. Here's a cool graph of all the debt the US will owe VERY SOON:

<https://preview.redd.it/fsp2wlocpmq61.jpg?width=1466&format=pjpg&auto=webp&s=aef47d463e6364c30d5c02d0de9d3e92deef57a6>

Here is another fun graph!

<https://preview.redd.it/hgi1kskfpmq61.jpg?width=1512&format=pjpg&auto=webp&s=8ad2493f413d583cee8992125c0da6fcb9588a5b>

So we've been dealing with some light stuff lately, it is time to get terrified. To be terrified, you should understand what a CMB or Cash Management Bill is. According to investopedia: <https://www.investopedia.com/terms/c/cmb.asp> "Cash management bill (CMB) is a short-term security sold by the U.S. Department of the Treasury. The maturity on a CMB can range from a few days to three months. The money raised through these issues is used by the Treasury to meet any temporary cash shortfalls and provide emergency funding." OH YEAH, I almost forgot, "These debt securities have minimum denominations of $100 and must be purchased in increments of $100. A minimum purchase of $1 million is required, hence, the reason sales are targeted to institutional investors." ENTER INSTITUTIONAL INVESTORS. About fucking time am I right? Now let's look at how this applies to our current situation:

[Institutions essentially gave the US government 1.9 Trillion dollars. No wonder why the SEC hasn't done anything about GME shorts...](https://preview.redd.it/6a15grknpmq61.jpg?width=1411&format=pjpg&auto=webp&s=28198d6bec04a719e4e795a33ef6a8816d83ab13)

So CMB issuance increased 20x, AKA government needed money to pay for the relief they were spitting out left and right, and institutions wanted to make some money. Not a coincidence that the rich somehow got richer during a global pandemic.

REMEMBER, this Audit is only as recent as September 30, 2020. Imagine how many more CMBs Citadel and Co bought??? The US Treasury Securities and GME are LINKED. As long as Citadel owns US debt (as outlined in The Everything Short), and as long as the Repo market relies on US Treasury Securities as collateral, the US government CANNOT let Citadel and other institutions fail. Institutions used their money as leverage over the US government. They don't care about interest on CMBs to make money, no way. They care that they gave the US Gov 1.9 Trillion dollars, used to fund vaccines, stimmy checks, and other forms of relief.

Hate to break it to you, but there's a phenomenal chance that your stimmy checks are actually dirty money from Citadel.

<https://preview.redd.it/fl5n25qrpmq61.jpg?width=1429&format=pjpg&auto=webp&s=d22b649bc9768b7ec13826109000f80aabdbf3cc>

In only 1 year, foreign ownership decreased by 7% (yeah other countries can buy Securities). It is widely known that China has been unloading their positions holding/ storing debt<https://www.globaltimes.cn/content/1198141.shtml#:~:text=China's%20holdings%20of%20US%20Treasury,from%20the%20US%20Treasury%20Department.&text=Fears%20of%20a%20US%2DChina,of%20US%20debt%2C%20experts%20said>..

The US is at a pivotal point. The more Securities the US issues, the more interest we have to pay. How do we pay for this interest? Issue more Securities that's how. GME shorts are covering shorts with shorts. The US government is paying interest on Securities by issuing more fucking Securities. That is why our debt is increasing astronomically.

Explained beautifully by GAO (im tired of taking and editing pics) "For example, in its 2020 long-term budget outlook report, the Congressional Budget Office (CBO) projected that interest rates on 10- year Treasury notes will rise from an average of 0.7 percent in mid-2020 to 3.2 percent in 2030 and 4.8 percent in 2050. Interest rates can also have a compounding effect on the debt, as borrowing to make interest payments adds to the debt." Well folks right now we are at 1.74% already! - <https://www.treasury.gov/resource-center/data-chart-center/interest-rates/pages/TextView.aspx?data=yieldYear&year=2021>

Fuck it, apes love crayons:

[What happens when that blue line hits 0? Those shorting US Treasury Securities make bank that\"s what.](https://preview.redd.it/tcdl1h0vpmq61.jpg?width=1512&format=pjpg&auto=webp&s=f9034c2fe47a83d40fb29e0d68194dba10bd4b5a)

I bet you're pretty disgusted right now and scared. Want to see the Department of The Treasury's response?

<https://preview.redd.it/t3jod4lgwmq61.jpg?width=1512&format=pjpg&auto=webp&s=026bd18570d6e1015c99ae9614ee389ac8b0dd65>

Here's a great article explaining How To Short The Treasury Securities: <https://www.moneycrashers.com/how-to-short-bonds-selling-us-treasury-bonds/>

Notes:

1.  """"""Historically low interest rates. Many investors are getting frustrated that interest rates on Treasuries are now at about a quarter of a percent. Fewer investors are willing to tolerate such dismal returns and either aren't buying or are selling their holdings.

2.  Interest rates may rise if the Fed stops the quantitative easing program. The Fed's have been under a lot of pressure to cease driving up the price of inflation. If they stop printing money with their quantitative easing program, they will be unable to purchase new Treasuries. This may drive interest rates up further. In other words, treasury values may decline if interest rates stay where they are or if they increase. Either way, this creates a good opportunity for investors who want to sell short.

3.  Diminishing value of the U.S. dollar. If the Federal Reserve continues to print more money to save the U.S. economy, the rate of inflation may skyrocket. The [price of gas](https://www.moneycrashers.com/gas-prices-rising-prepare/) has already increased to over $4.00 a gallon, largely due to the declining value of the dollar. As the dollar loses value, investors become more anxious about investing in U.S. Treasuries. *Also, many nations are discussing removing the dollar as the world reserve currency, which would cause serious ramifications for U.S. Treasuries.*

4.  Institutional and foreign support of U.S. Treasuries is declining. China is the largest single holder of U.S. Treasuries, holding approximately 8% of all U.S. debt, and has been selling its holdings. Bill Gross, the manager of the largest bond fund in the country, and [Warren Buffet](https://www.moneycrashers.com/buffettology-warren-buffet-quotes-investment-strategy-stock-picks/), another legendary investor, are both shorting U.S. Treasuries. Other countries are starting to unload U.S. debt as well. This is a widespread indication that faith in the U.S. government as a lender is at an all-time low.

5.  Fear that the U.S. government will default on its loans for the first time ever. The S&P is threatening to take away the U.S. government's AAA bond rating. Many are terrified that as the U.S. is on its way to reaching $15 trillion in debt (i.e. [national debt ceiling](https://www.moneycrashers.com/raising-national-federal-debt-ceiling-definition/)), it will not possibly be able to make all of its payments.""""""

There is also information regarding exactly HOW to short Treasury Bonds in that article.

What this means for GME Apes:

Citadel's connections with the US Government are widely known, but why hasn't the government tried to distance themselves? Because Citadel was willing to buy those CMB's to take on government debt. I bet Citadel bought some CMB's 1.9 Trillion/ 116 CMBs= Average of 16 Billion per CMB. Think about that. The minimum amount to buy is 1 million, but Institutions were willing to spend 16,000x that on average.

Like what was beautifully analyzed earlier by The Everything Short, the economy RELIES on the Repo market, therefore relying on Treasury Securities, therefore relying on those who purchase them.

The US economy will enter a VERY bad place pretty soon. Once we squeeze, if the government bails out hedgies again, the US economy will fall even further into a depression. Personally, I will use my gains to help those in my community. Tough times are ahead of us. It is important to note that the IMF has major cash reserves designed to be dispersed to members in the event of a financial crisis. The US government will need to rely on the IMF soon to bail them out, and an event of this magnitude will lead to STRICT restrictions on the US economy. The IMF reserves the right to impose sanctions and rules on any member who receives funds and aid. The US will be forced to accept these sanctions, which could hinder many opportunities for short term growth. For myself, I am considering moving my USD from GME post squeeze, and converting to Yuan or placing it all in a different safe haven. The parallels between the US government and the hedgies are appalling. Both crave money, but the hedgies are fueled by greed, while the US needs the money. *However, both have put themselves in this position. This is not financial advice.
