%53, so far. The problem with the short interest being %140 is that the notional value of shares to cover that extra %40
is in fact, infinite. It's literally everything those funds can sell, borrow, and get bailed out to cover their position.
My prediction last week was this has system wide implications, and I'm thinking 1. the Fed will intervene, leverage Robinhood's EULA, and buy out everyone's shares at a price that will be profitable but still piss everyone off. 2. the new U.S. administration will use this as leverage for some backburner, discredited radical regulations for things like a financial transaction tax or a tax on assets in custody, but only for retail investors and not their donors, 3. the admin will direct the IRS to prioritize making public examples of new traders who screw up their filings. And that's the optimistic view.
The alternative is contagion that takes down Citadel, and causes a lot of institutions to sell otherwise valuable stocks to cover knock-on effect positions, risking things like indexes and pension solvency.
Imo, this is a macro level liquidity crisis, and there are some other players who might use the moment as well. E.g. China could dump some of its massive U.S. treasury holdings, ostensibly to hedge dollar devaluation risk, but really it's seizing its moment to cause enough chaos to tip the U.S. into actual domestic chaos while it consolidates its position in Taiwan and Hong Kong.
Viewed this way, the Treasury and the administration doesn't really have a choice, assuming they can a) use Robinhood's EULA to sell everyone's shares to the Fed, and b) convince the Fed to provide that liquidity vehicle to unwind this execrably stupid trade.
Fanfic? Maybe, but I think the system level risk means the stakes are about opportunities to make moves that upset the global balance of power, and not just a domestic populist issue.