Drewy99

Drewy99 t1_jbl5afg wrote

Thank you. Final questions -

What happens if you order 100 widgets with a pay -on-delivery agreement, pre-sell 100 widgets to other party, and those widgets don't ever get delivered by the time specified in the contract?*

Because that's what's going to happen in the case of these shorts, right?

*In this scenario the other buyer has plenty of stock and this was just a 'top-up' order for the warehouse. Because of the billions of widgets this company goes through they have a steady flow from multiple suppliers so they are not make or break counting on you.

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Drewy99 t1_jbkx3gh wrote

>This type of account isn't odd, it's absolutely the norm.

Right I understand that, I'm just wondering what happenes in the reverse where you order 100 widgets and the supplier takes your money then goes bankrupt after only shipping 10.

You will still end up in bankruptcy held responsible by your creditors, right?

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Drewy99 t1_iy92mow wrote

I just look at it like if the plane is going to crash it probably doesn't matter if it's hydrogen or jet fuel, you're gonna go boom either way.

But you make a good point about a plane that is still on the ground.

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