That shorting explanation of SNG makes no sense…… this is what really happens…..A short has no shares ….they sell to a buyer, the buyer want’s his/her shares, so the seller has to borrow the shares from a pre existing long, which they do and then deliver those shares to the new buyer…..there are no shares to give back, as the new buyer holds them.
As long as the short remains they have to keep borrowing. That is why a short squeeze can happen in a stock which has a known and well managed float. Once the buyers get to a certain level of the float, the shorts get panicked, cannot borrow as longs refuse to lend and are forced to cover.
That was how it worked before electronic trading took over, plus most importantly the physical certificates actually changed hands. Once the certificates became digital it all changed….Off exchange trading took off, exchanges opened all over the world, Germany is particularly bad, look on Yahoo for a stock quote and you will see quotes from exchanges in Hamburg, Munich etc…..plus you have the Dark Pools run by GS, JPM etc…..Then it seems the SEC are very lax to say the least in policing short delivery certificates. So in essence the ‘float’ is now an unknown number of shares, just like a Commodity ….That is why shorts exist in abundance, they no longer have to deliver, or very rarely.
That is how I read the problem. That said, if that is the situation the shorts are way more exposed than normal, as once sufficient buyers turn up and demand delivery the naked shorts will have to find the shares, they never borrowed to deliver and by definition that will only happen at much higher prices.