From the prior DD in this series [1], we know that ComputerShare can “give” the DTC registered DSPP shares to hold onto for operational efficiency which are then “given back” as shares beneficially owned “for the benefit of” (“FBO”) DSPP Plan Participants at ComputerShare, as illustrated in this diagram:
From The Prerequisite DD
It’s time to explore what “operational efficiency” benefits may be gained by DSPP shares going around this roundabout. At first glance, shares are basically just going in a big circle from DSPP Plan Participants with registered ownership DSPP shares at ComputerShare heading to the DTC, who hands shares to ComputerShare’s broker who maintains those shares for the benefit of ComputerShare who holds those shares for the benefit of Plan Participants. While I think it’s unlikely that shares just go around in a big fat circle for no reason, I do remember people getting onto flights to literally go nowhere a few years ago [CNN, NYT]; so maybe these operational efficiency shares simply miss hanging out at the DTC?
Let’s look more closely… While title is held by a registered DSPP Plan Participant, ComputerShare is giving the DTC possession [1] of registered DSPP shares to the DTC to hold for operational efficiency which then ultimately end back in the possession of ComputerShare’s broker (who isn’t lending out shares) for the benefit of ComputerShare for the benefit of Plan Participants. If we treat the DTC’s operations as a big black box, we see registered shares going into the DTC black box and beneficially owned shares coming out of the black box to ComputerShare for Plan Participants.
DTCC Black Box: Inputs vs Outputs
Investopedia says that shareholders have rights, with a list of 6 main rights including:

1. Voting power on major issues.
2. Ownership in a portion of the company.
3. The right to transfer ownership.
4. Entitlement to dividends.
5. Opportunity to inspect corporate books and records.
6. The right to sue for wrongful acts.

By contrast, beneficial owners only need to have or share 2 of those rights (bolded) according to the definition of beneficial owner in Rule 13d-3: the power to vote and the power to dispose of the security (e.g., sell).

§ 240.13d-3 Determination of beneficial owner.
(a) For the purposes of sections 13(d) and 13(g) of the Act a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares:
(1) Voting power which includes the power to vote, or to direct the voting of, such security; and/or,
(2) Investment power which includes the power to dispose, or to direct the disposition of, such security.

ComputerShare basically confirms this list (except for the right to sue as that’s probably not one their issuer customers would emphasize) and adds that beneficially held shares may be lent by brokers generally (but not by ComputerShare’s broker).
Registered Shareholder Rights vs Beneficial Owner Rights
Maybe you’ve had different experiences from me, but I’ve never known Wall St to deliver more than the bare minimum they’re contractually obligated to. Which means the DTC black box is very likely watering down shareholder rights from the 6 that go in down to the 2 which come out. (And yet, we’re supposed to believe that all shares are equal. 🙄)
Dividends (#4 on the list) [2] may be the clearest example of a watered down shareholder right. Registered shareholders have the right “to directly receive share dividends” [CS FAQ] which means if a company (e.g., GameStop or OverStock) issues a dividend, registered shareholders have the right to directly receive the dividend as issued. If the company issues a crypto dividend (as OverStock tried to do), registered shareholders have the right to directly receive the issued crypto dividend. Beneficial shareholders would get an issued dividend, if available, or a cash equivalent if not. Historically, stock and other dividends to beneficial shareholders could easily be delivered as a cash equivalent, a watered down form. Crypto dividends don’t scale well with shorts (both naked and legal via, for example, share lending and borrowing) because crypto tokens are unique which makes it abundantly clear why a crypto dividend was nixed for a heavily shorted idiosyncratic stock like GameStop; especially given GameStop’s particularly active shareholders.
Ownership (#2 on the list) may be the second clearest example of a watered down shareholder right as more security interests to shares exist in the DTC’s beneficial ownership system than there are shares; with the SEC saying beneficial shares get a pro rata interest in the securities of that issue held by DTC. [See End Game Part Deux: Problems at the DTCC plus The Bigger Picture, particularly the section “The Pie Is Shrinking: Get Out (And DRS) While You Can”]
Voting (#1 on the list) is also an example watered down shareholder right; this one having a long history on this sub with, for example, BroadRidge tossing 7B votes and bragging about it. (Beneficial owners only need to get shared voting rights per Rule 13d-3 above so those 7B “shared” votes just lost out to who they shared with.) Unlike other beneficially held shares, voting rights for DSPP shares are not watered down as ComputerShare sends registered holders their voting forms.

Operational Efficiency Shares, Whatcha Doing In There?

A big black box is a pretty good description of the DTC which does not want us to know the ins and outs of what’s going on. Black holes are a pretty good example of a big black box and, most importantly, we know a lot about black holes even though they can’t be directly observed. Just as we learned about black holes without direct observation, we can similarly learn a lot about the Operational Efficiency shares even though we can’t directly observe them in the DTC habitat.
Even though we can’t look inside the DTC’s big black box, it turns out we don’t really have to in order to identify some benefits from these operational efficiency shares taking their roundabout trip to nowhere.
Locates A few commenters have suggested that OE shares could be used for locates so I’ll address this first. Possible, yes. But I don’t view this as the most interesting use for OE shares. Brokers are supposed to “locate” securities available for borrowing before short selling. [Wikipedia)] Basically, before selling short a broker is supposed to find a source to borrow. The “locate” requirement does NOT require the security to be borrowed before short selling which can result in a legal naked short.
You may be wondering why I don’t view “locates” as particularly interesting for OE shares if short sellers need to locate shares to borrow before shorting. Well, market makers are also exempt from this requirement as long as they’re market making. 🙄 On top of the market maker exemption, remember House Of Cards? In House Of Cards 3 [SuperStonk], we learned about the now 🤦‍♂️ hilarious F**3 key **- yeah, the one on a keyboard. Brokers like Goldman found the locate requirement simply too much work so they would press the F3 key and their system would auto-approve the locate requirement based only on the number of shares available to borrow at the beginning of the day; regardless of whether those shares were still available to borrow or not.
House Of Cards 3
Meaning as long as there were some shares available to borrow at the beginning of the day for their share copying system, brokers could just smash the F3 key to make as many copies of shares as they need. Even if only 1 share was available to borrow at the beginning of the day, a broker could simply smash the F3 key 100 times to approve the locate requirement for 100 shares.
So while OE shares could be used for locates, they wouldn’t need many shares each day to make an unlimited number of copies - even just 1 is enough.
Lending shares on the other hand…
Rehypothecation Rehypothecation is the reuse of customer collateral for lending. Per a 2010 IMF Working Paper, The (sizable) Role of Rehypothecation in the Shadow Banking System,

Rehypothecation occurs when the collateral posted by a prime brokerage client (e.g., hedge fund) to its prime broker is used as collateral also by the prime broker for its own purposes.

This IMF paper defined a “churning factor” to measure how many times an asset may be reused; and then estimated a churning factor of 4 noting that it could be higher because international banks (e.g., HSBC and Nomura) were not sampled. This IMF paper found a single asset may be lent and borrowed 4 times, or more; an average which could be higher globally.
https://preview.redd.it/ymr3j03zri0d1.png?width=795&format=png&auto=webp&s=1555314cefd520658a4f78dc4745867063e3bf34
Churn Factor Could Be Higher Globally
How much higher? We may have seen a churn factor as high as 10 for a less idiosyncratic meme stock per my prior post, Estimating Excess GME Share Liquidity From Borrow Data & Churn Factor. Presumably, the idiosyncratic meme stock would have a higher churn factor (but not that important for this post).
More recently (2018), the Federal Reserve published this Fed Note on ​​The Ins and Outs of Collateral Re-use studying how often collateral is reused (i.e., rehypothecated) for Treasury & non-Treasury securities [3] with a beautiful figure illustrating how “for any given moment in time, one security can be attributed to multiple financial transactions” where a share could be posted multiple times through Security Financing Transactions (SFTs) and sold short. [4] Sounds familiar, right?
https://preview.redd.it/zsztmji4si0d1.png?width=1530&format=png&auto=webp&s=f222dfe50929f668af8f8f0b39514a7d862db9c9
Figure 6c of this Fed Note shows a Collateral Multiplier over time illustrating how “PDs [Primary Dealers] currently re-use about three times as many securities as they own for non-Treasury collateral and seven times as many securities as they own for U.S. Treasury securities”.
AKA \"Money Multiplier\"
The Fed Note describes their Collateral Multiplier as a “money multiplier” (Seriously, I couldn’t have made this up in a million years.),

In a sense, our Collateral Multiplier is akin to a "money multiplier," as it compares private liabilities created by a firm with the amount of specific assets held to create those liabilities. [​​The Ins and Outs of Collateral Re-use]

And, of course, the Collateral Multiplier aka “money multiplier” ratio goes up when there’s less collateral available and down when there’s more collateral available. (Can I get one of these multipliers?)

Intuitively, we expect the ratio to increase when collateral is scarce and to decrease when collateral is more abundant.

Which means Primary Dealers [Wikipedia has a list of familiar names including Deutsche Bank, JP Morgan, Morgan Stanley, Nomura, BofA, Citigroup, TD, UBS, and Wells Fargo; amongst others] can simply kick securities around a few extra times (e.g., with SFTs and short sells) to effectively multiply the amount of money and/or collateral they have any time they need it. (Within limits, I hope…)
Thus, rehypothecation is a very interesting use of Operational Efficiency shares from ComputerShare as various primary dealers can simply “multiply” the number of shares they have – a concept that we’re already quite familiar with. As rehypothecation, short sells, and securities financing transactions are all perfectly legal, rehypothecating more GameStop shares provided to the DTC via operational efficiency satisfies Ground Rule #2 [defined in (1/n) in this series],

1. All parties involved are all generally attempting to operate within the bounds of the laws and regulations wherever possible. (I know we often scream “crime”, but why break a law when money can simply [re]write laws to make activities legal. Regulatory failure is the reason why something that should be criminal, isn’t. And regulatory failure happens when armies of lawyers are paid to create and exploit loopholes so that actions which should be criminal, are instead legal.)

We can update our conceptual model to include rehypothecation to more clearly illustrate how Operational Efficiency shares held in the DTC can be rehypothecated (e.g., with SFTs and short sells) until a watered down share is delivered to ComputerShare’s broker to hold FBO ComputerShare, who holds the watered down share FBO DSPP Plan Participants.
https://preview.redd.it/bt3gnx99si0d1.png?width=4764&format=png&auto=webp&s=7b0b72b935f740e8a3036f88e1a4e1dfb57dd46c
You might notice from this illustration that ComputerShare has been telling the truth satisfying Ground Rule #1 [defined in (1/n) in this series]. Neither ComputerShare’s nor their broker lend or need to lend shares. All the rehypothecation happens “upstream” amongst other DTCC and NSCC Participants until shares are finally delivered to ComputerShare’s broker at the end of the “Churn Chain”. ComputerShare has made no representations about what the DTC can or can not do with the shares in their possession. And, realistically, ComputerShare is in no position to make any representations about what happens within the DTCC system – ComputerShare is only responsible for themselves and, to some extent, their broker.
The Fed Note and IMF paper found assets may be churned and reused 3-4 times (overall market average) which means the end of the chain is typically around D3 or D4. (If my prior DD estimates are correct, there were signs a less idiosyncratic meme stock may be churned up to 10 times ending the chain at D10 which suggests a potentially longer chain for GME, the idiosyncratic meme stock.) If there is no collateral reuse for an asset, the chain would have zero length meaning Operational Efficiency shares go straight from the DTC directly to ComputerShare’s broker. (Programmers almost certainly understand zero length chains very well – go find one if you need an explanation.)
GameStop is idiosyncratic, thus atypical. Per the IMF paper, collateral reuse increases when collateral is scarce and decreases when collateral is abundant (quoted above). If we consider GameStop investors have been direct registering shares (i.e., DRS) and registering shares (e.g., DSPP) thereby removing title and/or possession of shares from the DTC/DTCC/Cede & Co, then GameStop share availability has been becoming more scarce and the “Churn Chain” for GME should be longer than average representing a higher collateral multiplier and churn value.
While we may not know the exact length of the Churn Chain for GameStop shares, we can pretty well surmise that it’s not a zero length Churn Chain where there is no collateral reuse based simply on scarcity. After all, a shortage of available shares is, by definition, required for any short squeeze (including MOASS). Requests by brokers to enable Share Lending [5] is another example indicator that GameStop shares are scarce.
In addition, according to Investopedia [6], “Banks, brokers, or other financial institutions may navigate a liquidity crunch and access capital by rehypothecating client funds” and we’ve seen indicators showing us banks are in deep trouble:

• SEC FTD-ing FTDs Because A Clearing House 🪦 and Big Banks Bankrupting Soon
• Banks On The Brink Of Bankruptcy since March 2023
• Fed & FDIC 🦵🥫 can't hide unrealized losses
• Bank Term Funding Program: The Not-A-Bailout Can Kicking Bailout

The downside to rehypothecation is the higher leverage increases risks of default and a single collapse can start a chain reaction knocking down others like dominos.

There are also leverage considerations that increase that risk of default. Overleveraged investments often face covenants; when specific conditions are met, trading accounts may receive a margin call or face debt default. As a row of dominos fall after a single collapse, a single margin call may cause other debts to fail their account maintenance requirements, setting off a chain reaction that places the institution at higher risk of overall default. [6]

This risk for rehypothecation sounds exactly like what the Options Clearing Corporation was complaining about to the SEC when the ​​OCC Proposed Reducing Margin Requirements To Prevent A Cascade of Clearing Member Failures [SuperStonk] early 2024. If the OCC can eliminate margin calls, then no dominos get knocked down. (Thankfully, apes have done a phenomenal job in convincing the SEC that this OCC proposal is a very bad idea. Support the SEC’s rejection of this as Simians Smash SEC Rule Proposal To Reduce Margin Requirements To Prevent A Cascade of Clearing Member Failures!)
Most importantly, it may be tough to regain possession of an asset when someone in the rehypothecation chain defaults. Remember from the prior DD the expression about possession: Possession is nine-tenths of the law.

Clients must be aware of rehypothecation as it is technically their own assets that have been pledged for someone else's debt. This creates complicated creditor issues where an investors shares may longer be in their possession due to their custodian's default. [6]

We know assets are rehypothecated 3-4 times on average, GameStop shares are scarce, banks are in trouble, stock loan volume is skyhigh, and the risks of rehypothecation are real. So it’s pretty clear that rehypothecation is happening generally with pretty darn good reason to expect GameStop’s Churn Chain is at least of non-zero length (i.e., GameStop stock is being rehypothecated).

Breaking The Chains

While some may like chains and being tied up, I’m not one of those apes. Especially as a Churn Chain waters down my shareholder rights and may make regaining possession of DSPP stock difficult in the event of a cascade of defaults, as warned by the OCC. (If you like chains, feel free to skip this section.)
As it turns out, we don’t need to know exactly how long the Churn Chain is for GameStop stock. Simply knowing a Churn Chain exists with non-zero length means there is a chain. Where there is a chain, it’s possible to break the chain. (Even if you don’t know how much health) your enemy has in a game, you still try to take your enemy out. Right?)
A churn chain that starts from ComputerShare holding DSPP shares in DTC for operational efficiency can easily be broken as “[a]n investor can, at any time, withdraw all or part of their shares in DSPP book-entry form and have them added to their DRS holding”. [ComputerShare] See also [7]. Quite possibly one of the easiest chains in the world to break as the Churn Chain is weak to DRS. Simply DRS the DSPP shares to take away the head of the chain and the rest of the chain falls apart. (And, DRS-ing "street name" shares cuts chains into pieces too!)
One side effect of breaking a Churn Chain is that all shares attributed to transactions in a broken chain (e.g., SFTs and short sells) need to be reallocated to other chains, effectively making other chains longer and increasing the risks from a default.
Analogy: Think of the shares as a deck of cards. If you deal 52 cards to 4 players (A, B, C and D), each player gets 13 cards. Each stack of 13 cards is basically a Churn Chain. But if you take out a stack by removing the bottom card from A and distribute the remaining 12 cards from A to B, C and D then B, C and D each now have 17 cards. If at any given time a card can cause a player to lose the game, it's better to have fewer cards than more. And, the players who get out early won't lose.
Any party in the Churn Chain who defaults will make it hard for the original owner to regain possession. Longer chains include more transactions and more parties so there’s more risk of default on longer chains than shorter chains. Thus we see another vicious cycle setup where incentives are aligned such that DSPP and beneficial shareholders may want to avoid the impending default and rehypothecation risk from their shares being held in DTC. In order to avoid the impending default and rehypothecation risks, shareholders are incentivized to Directly Register shares to ensure having both title and possession. (Shares held in “street name” have little or no protection from rehypothecation risk and simply registering shares in DSPP doesn’t guarantee possession [1].) As with the other vicious cycle, any remaining shareholders in DTC share a shrinking pie of diluted ownership so it is in their best interest to get out and DRS; thereby shrinking the diluted ownership pie even more which is more reason for remaining shareholders to get out. These vicious cycles will eventually leave few, if any, remaining shares at the DTC for beneficial shareholders. Nobody knows what will happen if this ♾️🏊 happens.

Footnotes

[1] If you haven’t already, please read the prerequisite DD in this WalkThrough Series to understand how ownership of property is separated into two concepts: title and possession. [See, e.g., StackExchange] Understanding the differences between title and possession are particularly important here where it’s worth being extra careful identifying how an entity is in control of an asset.

1. DSPP is technically different from DRS [WalkThrough] (1/n)
2. Definitely DIFFERENT "DRS Counts" [WalkThrough] (2/n)

[2] Dividends have been heavily discussed on SuperStonk with many DD posts, including for OverStock and the precedent OverStock set which would have allowed GameStop to issue their own crypto dividend, possibly as an NFT.
[3] Footnote 16 of the Fed Note itemizes various classes of non-Treasury collateral which includes equity which, per Investopedia, is a synonym for stocks.
[4] While short selling is pretty well known, Security Financing Transactions (SFTs) may be more obscure despite discussion of them in the past so here’s some historical SuperStonk links for you (where you may notice some well known OG DD apes):

• Visualization of how SFT trades could prevent shorts and/or naked shorts from becoming reported FTDs per DTC-2021-010 filing
• SEC Comment Against Proposed Rule NSCC-2021-10 because SFTs Will Be Used To Obscure Abusive Short Selling
• How market makers, broker dealers and the DTCC game the markets: Why lending and short interest data to evaluate the true number of shorts is plain useless: Revisit SFT clearing to avoid Fail to Deliver, Reg-Sho, Forced-Buy ins and ALD altogether
• Let's talk RRP, SFTs and DOs
• DTC-2021-014 Settlement for SFT Services Risk Control Management

[5] Simply search SuperStonk for share lending. Don’t make me Google That For You.
[6] https://www.investopedia.com/ REMOVE_FOR_AUTOMOD terms/r REMOVE_FOR_AUTOMOD /rehypothecation.asp
[7] Withdrawing whole DSPP shares into DRS seems to make a lot of sense as doing so guarantees possession. Selling fractionals, less so. If you intend to keep buying, I would think adding to the fractionals to later withdraw whole shares makes more sense. As for the concern about fractionals tainting the whole account, I’ll cover that in another post. For now, you do you.

Stupid stupid sleeping mat why won't it just have all the holes at once instead of having a new one each night. I've cut my remaining patches such that I'll have enough to cover 20 holes if necessary. I'll go to war with this thing before I give in and buy a new one. I patched the thing on the roof of the tent by dribbling water on it til I found bubbles. I'll do it again tonight and probably find more. Nasty holes. Terrible holes.
Anyways I slept fine, just a little interrupted. Every day I feel like I'm not sick and every morning I still am. Maybe today's the day. I dragged my ass in the morning, not moving too quick. The spot we picked was nice and chilly to let us sleep a little longer, nobody bothered us under the bridge this time. Last night we had a real treat in the form of a golden sunset over the mountains, hues of orange and pink lighting up the evening sky. It was very lovely. I forgot to mention we met another person doing a long distance ride, we've seen this person a few times since leaving Tokyo. Japanese travelers love pinning a piece of paper on their back that says where they're off to if they're traveling some ridiculous distance, for this person it was Tokyo to aomori. A respectable distance, but he nearly fell over when we showed him how far we've gone.
Eventually we got moving and did some sightseeing. The castle in aizuwakamatsu was rebuilt in the 60's as a museum, so we read about the history of the area. In a nutshell, it used to be called Aizu up until the local clan sided with the shogunate during the Meiji restoration and caught the wrong end of a brutal smackdown. In a way it felt framed in such a way that they didn't deserve it, and the subsequent suppression of the local people has left a simmering resentment. The city was renamed Wakamatsu, but is now aizuwakamatsu, and many t-shirts for souvenirs just say Aizu. The history of the city prominently includes the story of the Byakkotai, the "white tiger unit". They are hailed as heroes, but were teenagers who rushed into battle unprepared and were either slaughtered or committed suicide after hiding in a cave. Only one survived after a failed suicide to tell the tale. I guess things were different in the past, but poorly trained child soldiers killing themselves out of clan loyalty just strikes me as a tragedy, not a heroic epic. You know who disagrees? Fascist Italy and the Nazis, both of which donated monuments to the shrine for the Byakkotai and both of which remain to this day.
Alongside this bizarre tableau was the hexagonal shrine with a wooden spiral staircase, the only Edo period wooden structure still around and one of the oldest in the world. Honestly I'm surprised they let people walk through it, it felt so old. But they managed to build a double helix tower many hundreds of years ago and I was duly impressed. The ancient rafters and walls were covered in paper pasted to the walls to indicate a particular pilgrim was there. None of the old timey stickers looked new, as I imagine if people still did it the shrine would be covered like feathers on a bird. People did feel the need to scrawl their names in the wood of the wall directly, though. The whole place looked like it is in need of refurbishment and maybe someone to scold people with pocket knives.
After the shrine, we stopped to get some sandwiches at a conbini and then a drug store to get me better meds. The bufferin just wasn't working and I needed something to help me clear the congestion in me. We found some better meds and in took those. The feelings of having taken meds that really didn't work well and the stress of the heat of the day got to me and I had to stop and have a big cry. I hope I get better soon. We'll be stopping for a few days soon, I'll plan to just rest in bed. Doing a whole week of craziness followed by a week of biking in hot weather while a cold racks me has brought me to a low.
Naturally, when I get real low, that's when I feel the need to do big emotional processing. I knew it would happen eventually, though I'm impressed I could avoid it for three quarters of the trip. I wanted time and space to do some thinking, some crying, and some healing. The topic is private, of course. There was a bike path that led from aizuwakamatsu to kitakata to the north and we followed that, the depths of my thoughts so severe that I barely even acknowledged I was moving at all. Bryce told me later we were going pretty fast, so I guess it's good we were somewhere I could be on autopilot. The views in the valley were lovely, the panoramic mountains ringing the bowl shaped valley we were in. We biked towards snow capped mountains, but I was fully turned inwards, my process taking all of my focus.
Before too long we were in kitakata, a city that reminded Bryce of Roblin in Manitoba. It was a pretty quiet place, and rural too. It was known as one of the big three ramen regions in Japan, the second of which we've seen. We found the place that is most well known in Japan for kitakata ramen and got in line there. It was busy, as to be expected, but we got in relatively fast. We got the usual, whatever was the house special with extra chashu for protein. While the noodles were excellent, we both found the broth a bit boring, a pork on pork experience. It didn't taste particularly deep or complex, and was almost simple to a fault. Perhaps we've reached the limits of our tastes here, but it was just okay to our palate.
We got back on the bike route north, hoping it would continue a bit further before we had to get on the mountain highway. We would have to eventually, as no other roads led through the mountain pass. The bike route wasn't listed on the map, but was in front of us, so we pressed on. Much like the previous section it was a raised lane with gentle curves, likely an old rail line. This path eventually spit us out near an onsen, and then we were on our own. The road we wanted to take onto the highway was unexpectedly closed, so we had to detour up a road that went on top of a dam nearby. We enjoyed seeing some more wisteria, the ones around here growing wild and festively adorning trees in pale purple blossoms.
The dam was big, and had a road on top to ride on. I wanted to see the penstock and the spillway, the latter far below the road we biked on. Below in the shadow of the dam was a defiant onsen, oddly juxtaposed against the huge forward wall of the dam. We took some time to figure out what road would take us up to the highway which was some 100m above the dam. One road went into a tunnel and seemed a sure bet from the road signs near it, the other wound around the dam reservoir and disappeared into the woods. Looking at our maps, one said the road would continue and join up later, the other two disagreed saying the road ended. I voted for the sure bet, Bryce agreed but bet me a rice ball the road went through.
The tunnel indeed brought us up to the road, which was less of a road and more a series of bridges interspersed with tunnels piercing the mountaintops. It felt like we were on a great arc that hit the tips of every mountain, the gentle gradient of the road more important than anything else. We appreciated the easier climb, but the tunnels were tricky. Many of them had construction ongoing, so we were escorted through one set of tunnels to avoid stopping traffic in the single lane that switched directions periodically. At each tunnel entrance we worried the construction worker would bar our way but most were friendly, apologizing but firmly telling us where to go. As we approached a very long tunnel, an excitable construction worker stopped us and told us many things, but the best parts we could gleam were that the tunnel ahead was very long and we needed to have lights on inside.
The tunnel was indeed long, the longest we've been permitted in this far at 4km. The tunnel was completely straight too, giving a bizarre feeling of being in an infinite tube, perspective lines perfectly converging. The perspective made it feel like we were going uphill, but my speed told me it was downhill. Very confusing. Eventually we made it out and begun a very long and coasting descent, the grade again just gentle enough that we could coast at full speed and not tap the brakes. Usually we bike up the mountain just to waste the energy on brakes on the way down, here we could coast a lovely 10km, perhaps getting a little chilly from the lack of pedaling.
Yonezawa was our destination for the day, and despite really wanting to take it easy we still somehow did 100km. Tired and dirty, we took our biking clothes to a laundromat and went for dinner at a Chinese place. We had a black bean pork dish that was sticky and good, a chili fried chicken dish that was delicious but full of bones, and a fried rice that was mediocre at best. Waiting for our laundry to come out of the dryer, we had some snacks and commented that this city was extremely quiet at night. Not much activity going on here.
Bryce had a park in mind for camping, so we went there. We landed up making our way to the back of the park and found a spot to camp behind a few trees in a weedy area. Nobody should care we're here, but we're near a train line and every so often a passenger train roars by with big booming noises. Hopefully it doesn't run too early, but we might get woken up.
With the new meds, this evening is feeling better than days previous, though I have a lot on my mind for processing right now. A good sleep will help with that.

I figured I’d see if anyone wants my Kouki. Before I continue to throw money at a car thats only been driven 50 miles in 2 years😳 (Pic of odometer when purchased and current mileage included)
Otherwise its getting paint, bodywork and rust preventive undercoating, done for $7k
1998 “Kouki” 32,851 original miles Car was totalled by insurance in 2000, rebuilt 6 months later and issued reconstructed title. It was stored and sat for 22 years, I purchased it in 2022. Fuel tank was dropped and flushed, rusted pump and fuel sender, removed and replaced.
5 speed swap done by OneMotion Auto Warminster P.A. a respected JDM shop in December 2023. Car shifts gears smoothly and operates without any issue. All Dash gauges work after the swap and car is fully functioning. Power windows, sunroof,cruise control, power mirrors Ac/Heat all function.
$1800 just in parts, for the 5 speed swap. I took over a year to source the best OEM/Nismo parts and best Aftermarket parts for the 5 speed swap from canada, japan, england and the U.S.
The shifter assembly has been completely rebuilt with gktech springs to remove stock play and slack.
All lock cylinders pulled and rekeyed so no other 240 key opens it 🥷
EGR Plate installed and delete done by OneMotion Auto during 5 speed swap.
They also did a full run down on the car to make sure everything works as it should plus more than I can remember off the top of my head, I have the invoice for the 5 speed swap and all other laboparts.
Mechanically its mint and ready to drive🙌🏽
Car comes with OEM front lip splitter(not attached) OEM USDM Foglights included (not attached)
My stash of rare and discontinued OEM/Tomei parts, I have are not included in sale.
But are available for purchase to car buyer for additional cost.
5 Speed Swap Parts List: 5 Speed OEM Trans Dust shield, Flywheel 5 speed OEM trans mount 5 speed OEM shifter gasket OEM Shifter, ring, Shift knob, shifter plate OEM Shifter rubber dust boots OEM Shifter trim bezel Nismo Trans mount rubber isolator ARP Flywheel bolts ARP Pressure Plate Bolts Clutch line/Master CylindeSlave OEM Clutch Pedal Assembly Driveshaft Shop S14 ABS Solid 1 Piece Driveshaft Wiring Specialties Auto to manual wiring harness GKTech shifter springs GKTech Brass shifter bushing Oem Brake pedal pad Leather shifter boot $150 in OEM small bushings, springs, clutch rebuild kit, shifter hardware parts etc etc etc
New parts or service done in 2022-2023 prior to 5 speed swap: New EGR pipe New Spark plugs New fuel pump New fuel filter New engine belts New Brake pads New Brake rotors New Brake calipers New Brake master cylinder New thermostat Fresh oil change in August, oil filter Blutooth CD player all 4 speakers replaced, New tires all around last summer New wiper blades New Battery with 3 year warranty
No trades at all!!! I have to many cars already. Serious Cash offers will be considered. I’d like $13,000 OBO cause thats what I’m out of pocket so far, but feel free to offer.
The mileage has been Carfax verified, engine matched to vin and 3 independent Nissan USA Dealerships have confirmed the odometer, has never been removed or tampered. Car is rust free and I encourage any actual parties with actual money to contact me for detailed videos of vehicle.
Had a bunch of people try to make me feel like a Chomo, but heres the facts. Its a real Kouki Its super low miles It runs and drives Its not a rusty shitbox Its technically one color It’s not on jack stands Its straight and body panels line up. So its in better condition than half the 240s out there. I don’t need to sell it, I just have too many cars and don’t use this one at all.