Do you think these short sellers are idiots. They have a thesis. They have a price target. They have a price target date. They have all this calculated as well as interest carrying cost. Right now, they think they will still make a lot of money even paying 21 percent interest. That tells you something about their thesis price target doesn't it. I'm not saying they are right or wrong. But when you are the most heavily shorted stock on one of the exchanges, there are A LOT of pro's who are short and I assure you they have done their homework. They are not sitting in their underwear posting on the Yahoo message board.
You don't consider that the shorts are in the VAST minority, only 24 million short to 105 million long. People like to say shorts are smarter but there were dozens of biotechs that soared and buried the "smarter" shorts six feet under.
21% is charged on new positions, correct? Or do the established positions also have to pay the 21%? example, If I borrowed 6 months ago and the rate was 8% at that time do I keep that rate until I close or add to my position? Or is the rate fluctuating?
Schwab was charging 19 percent last week and have NAVB on the list of hard to borrow stocks. I dont doubt that it is up to 21 percent. Shorts have paid high rates for the past 3 years and it hasnt worked out for them. The charts shows a hard bottom around 2.35-2.45.