/biz/ - Business & Finance

So let me get this straight.
A short is a contract, where you "Borrow" a stock from a guy, sell it, and then fulfil the contract to buy another of the same stock again, then give it back to him. If the price of the stock went down, you can pocket the difference.
i.e. if I shorted a single share that was initially worth $100, but it decreased in price to $20, I'd have sold a share for $100 then paid the guy back a single $20 stock so now I'd be $80 richer.

Gamestop has a situation where they've shorted more stock than available, meaning that when the time comes to pay, they HAVE to buy the stock to give back to the original owner, no matter how much the stock has increased or decreased in price since. So theoretically, if the price went up to say, $10,000, the company would be forced to cover it all out of pocket by paying $10,000 for all the shares.
But since there are more share contracts than there are shares to buy, there's nothing stopping someone from setting the price to an almost infinite amount, thus causing the company involved to lose an infinite amount of money, instantly bankrupting their company as well as any risk-holding shareholders and so on in a giant chain.

Is my understanding of the situation correct?