Biden’s executive order 14032 replaced Trump’s executive order 13959 last year.
Executive order 13959 prohibited financial institutions to use Chinese securities as collateral, momentarily.
This propped up margin calls because of the large exposure our financial institutions have to Chinese securities.
When these securities were no longer accepted as collateral on January 27th, 2021, AMC stock surged.
The order was shortly amended (moved) to May 27th, 2021, where AMC stock had its second surge, reaching an all-time high of $72 per share only a few days after.
Biden then shortly passed executive order 14032 which gave institutions their collateral back for 365 days on June 2nd, 2021.
Well, those 365 days are coming to an end, and it seems June of 2022 could be a big month for AMC stock.
Let’s discuss it.
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No dates, only info
I’d like to make clear that the information provided in this article is merely only information backed by real government documents and data.
This excerpt is not to confirm a specific date where we can anticipate AMC stock to move up in price action, but rather acknowledge what’s happened in the past that could very well occur today.
Redditors were wondering whether there was a document that confirmed the replacement of executive order 13959.
And here it is – the order was replaced by executive order 14032.
One of the biggest differences between these two orders is that the previous executive order affected a total of 30 securities.
Executive order 14032 will affect more than 70 securities.
You can view the list of companies here.
Executive order 14032 is to go into effect on Friday June 3rd, 2022.
Will executive order 14032 trigger a short squeeze?
Given the nature of the rule, executive order 14032 will prohibit institutions to use Chinese securities as collateral, which will result in large margin calls.
When executive order 13959 disarmed institutions with this collateral in January of 2021, AMC surged to $20+ per share.
The order was amended as stocks surged resulting in sharp declines, giving institutions this collateral back.
The amended date moved to late May, where we saw AMC reach an all-time high of $72 per share.
Institutions were then given their collateral back on June 2nd for a period of 365 calendar days.
This collateral will no longer serve institutions on June 3rd until the order is amended again.
The expiration date in early June leads us to conclude we will see major short covering in heavily shorted securities such as AMC stock.
And because the list of Chinese securities being affected has increased, this means the amount of collateral that will be removed has also drastically increased.
If history repeats itself, this next surge will be massive.
That’s not even taking into consideration the next amended date.
Will this executive order lead to MOASS?
I’ve mentioned in previous articles I don’t think institutions will be held accountable for synthetics, but I hope I’m wrong.
One thing I do know is retail investors will need to keep an eye out on AMC’s short interest data to identify whether short sellers are calling it quits or sticking around longer.
No matter how high AMC’s price surges, the short interest data essentially provides investors with insight on how much fuel is left in a short squeeze play.
When AMC rose to $72 per share, the short interest had dropped to 16% from 20%.
AMC’s current short interest is 21.57%.
We’ve also seen that AMC short sellers have hit a record high number of shares on loan.
This means they owe more shares today, than they did AMC surged to $20 and $72 per share.
A third runup will be huge for AMC stock.
Only time will tell whether executive order 14032 is the catalyst or not.
Related: Are Institutions Preparing to Close Short Positions in AMC?
AMC is going to reach a new ATH
I believe AMC is going to reach a new all-time high from its previous record high of $72 per share.
Simply because the data is there.
The data that told us AMC was going to $20, then $72, and now even higher, is still there.
It’s just taking longer than traders would like.
But despite how long it takes, you can’t change the data.
You can’t change the fact that short sellers now owe lenders more than ever before.
And at some point, these lenders will need their money back.
Executive order 14032 seems like a highly likely trigger for AMC stock.
I’d love to hear your thoughts on the matter.
Leave a comment below for the community to see.
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Related: Will AMC Entertainment Stock Reach a New ATH This Year
A good reason I don’t see the president extending or removing this executive order is because it helps China and China helps Russia while we help Ukraine fight against Russia. It would lead the American public to ask what side of the fence is the president really on or is he sleeping in bed with both has been hinted to before with Biden‘s son having meetings with China. The president is not stuck between a rock and a hard place and the best way out is to let it go forward.
Frank I think you need to really look at this because the kids cover all the headgeunds
market makers and big bank institution as I don’t want another 2008 crisis going onNSCC-2022-003 Play this was approved yesterday by the SEC APPROVED!!! 05/31/22
This used to be NSCC-2021-010 that would implement the SFT Clearing Service. It got delayed 9 months and was then removed and resubmitted as NSCC-2022-003. This is the one i was waiting for to pass to tell us they were close to being ready to let the MOASS happen. It would limit or prevent the rest of the market from tanking when the hedge funds started defaulting because it would let them use the NSCC as a go between for loans from other members. If they defaulted the other party would not have to worry they won’t get there money and the NSCC would be able to sell off the loaned securities in a controlled manner to keep the stock from crashing. If it was just a loan between the shorter and the loaner the shorter would dump everything at once and fuck the market. There is no listed date for when it will go into effect so it’s possible it will go into effect right away but don’t be surprised if it’s in a month or so instead.
Here is a link:
https://www.sec.gov/rules/sro/nscc/2022/34-95011.pdf
STAY STRONG APES! UNITED WE GET RICH DIVIDED WE FALL!
They have had 365 days to prepare for this. Have they gotten away from these companies and made the appropriate adjustments to not be affected? How do we find out if anyone that’s actually involved in shorting amc will be margin called?
Good question. You mean like use something else as collateral?? If they had other options, don’t you think they would have used them by now??
What stopped them from doing that last year with AMC and GME??
What is stopping the gov’t from extending/replacing the order another year literally the following day, I don’t mind holding but blowing constant smoke is blind optimism.. it’s impossible to predict what will happen let’s be real here.. we have seen already that the sec dtcc and pretty much everyone at the top is not on our side and just looks to screw retail again and again… I’m hopeful but prepared to watch this go nowhere per usual….
Proves that RC is a time traveler 🙂
This should be straight forward – 14032 releases on Wednesday 2nd June and triggers a short squeeze in AMC, on the same day GME holds its AGM and votes for the stock split which in turn triggers a short squeeze in GME. What a double that would be – is this just a coincidence or has it been planned because the timing seems incredible?
Made a video on the fact that the Lenders will want their shares back and when they do the HFs will be in a heap of trouble.
I’m a little confused on your comment about the synthetic shares not being paid. Could you elaborate? I love your articles and trust your insight. I just understand that portion.
I agree, how can they not be responsible to cover the synthetic shares? There are probably billions of synthetic shares. I see no way that they could just walk away and act like nothing happened.
How are they not going to be held accountable for synthetics? That’s ridiculous for you to say that. So you’re saying they’re blatantly gonna go into people’s brokerage accounts and erase their shares that they paid real money to purchase? That’s spreading FUD in my eyes!
i dont think its gonna happen. if we know they know
They know we know; they will stop it from helping us.
Know Joe Brandon my guess he will extend the plan and once again save their ass’s .
Hope I am wrong.
Thank you Frank for explaining this in more detail than what I research myself. I wasn’t aware of that the numbers were changed when the administration went from Trump to Biden however the theory is the same should have the same results. Hopefully we can see some positive results in the price section of AMC from today increase going forward till June 3, 2022
I don’t think you’re wrong – also note that June 2nd in the GME annual shareholders meeting – the stock dividend will be voted in and they have promised they will implement it ASAP – likely within 10 days. So massive pressure likely for both – I’m bi-stonkual, so I can’t wait!!!
It’s not a vote for the dividend; it’s voting to allow the company to increase the amount of class A shares to 1B. 10 days later the company may announce a dividend split. Still all positive anyway.
Let’s start a discussion! Leave your thoughts below.