Yesterday Truth Social had 136 million shares outstanding at a closing price of $32.57. Today, after Trump met the terms for a payout of 36 million new shares, they effectively have 172 million shares outstanding at a closing price of $35.67.
So in one day, in which nothing happened, the paper value of the company went from $4.4 billion to $6.1 billion. That's an increase of nearly 40% in an already valueless company for no reason whatsoever.
It's a 20th century version of the South Sea Bubble, and it's too late to stop it. So many people are going to lose their life savings over this.
I can’t feel sorry for anyone losing their life savings after investing in Truth Social. I’m sorry, but nope.
Exactly. As Harold Melvin and the Blue Notes put it, if you don't know me by now, you will never, never, never know me, ooh, ooh-ooh.
I continue to think that it is best understood as some sort of bribery/money laundering scheme. I'm certain that Trump is keeping tabs on who the major "investors" are, and if some rubes get excited and increase the payout alongside, more the better.
Yup.
"So in one day, in which nothing happened, the paper value of the company went from $4.4 billion to $6.1 billion. That's an increase of nearly 40% in an already valueless company for no reason whatsoever."
Everybody knew the additional shares were coming so the price had already adjusted.
so the stock is behaving rationally? mmm hmm... gotcha
heaven's gate had a firmer grip on reality than the people buying into truth social
gamestop went to 80 and four years later it's at 10
if that's your retirement savings you might be having some interesting conversations with your wife and kids at some point
While I cannot discount the possibility, anyone putting their retirement savings into a single stock should be having a conversation with a therapist.
As for the stock behaving rationally, if indeed the price had already factored in the share release, it is no less rational than it was before. Which is not the same thing as saying it is rational.
Jerry Dean McLain first bet on former president Donald Trump’s Truth Social two years ago, buying into the Trump company’s planned merger partner, Digital World Acquisition, at $90 a share. Over time, as the price changed, he kept buying, amassing hundreds of shares for $25,000 — pretty much his “whole nest egg,” he said.
McLain, the tree service owner in Oklahoma, said he believes the stock could “go to $1,000 a share, easy,” once the media stops writing so negatively about it and the company works through its growing pains. The company’s leaders, he said, are being “too silent right now” amid questions about the falling share price, but he suspects it’s because they’re working on something amazing and new.
McLain is an amateur trader — he invested only once before and “lost [his] butt” — and said he hasn’t talked to his family about his investment, saying, “You know how that is.” But he believes the Trump Media deal is a sign he is “supposed to invest,” he said.
“This isn’t just another stock to me. … I feel like it was God Almighty that put it in my lap,” he said. “I’ve just got to hold on and let them do their job. If you go on emotion, you’ll get out of this thing the first time it goes down.”
https://www.washingtonpost.com/technology/2024/04/14/truth-social-investors-faith-trump/
Perhaps one is born more frequently than once a minute…
The rest of the quote is: And two to take him
" I feel like it was God Almighty that put it in my lap" The appropriate follow up question is 'Why do you think God hates you?'
One of my high school buddies put all of his retirement savings into his employer's stock, starting in 1985. Semi-retired around age 50 with a $5 million investment portfolio, because his employer was Intel. Sometimes it works out. Most of the time, it does not.
Interestingly enough, a week ago the share price plunged and the news reports were all about how this was because of the additional shares coming.
The price dropped below Trump's reward price, and lo and behold, buyers appeared.
So was the price a week ago the right one, or is today's price the right one?
The price already adjusted? It has not hit 4 bucks so it sure hasn’t.
Btw, screw anyone who is dumb enough to buy it. Hopeful that the extra 172 mill shares are available to short.
"The price already adjusted? ..."
See here from April 15.
"(Bloomberg) -- Donald Trump’s social media startup tumbled on Monday, extending a two-week slump, after the company took a first step toward allowing the former president and other insiders to capitalize on their stakes."
I think you meant 4 cents, not bucks.
4 ₽ is more like it.
It seems obvious that Trump will cash out at some point soon and the people who invested will lose their shirts. The bad thing is Trump will get out of his current financial pickle by stealing more money. The good thing is that the people losing their life savings are also pieces of shit.
In spite of that it went up over 9%. Maybe the Saudis are buying? About 7 million shares traded hands today at an average price of about $34 so it only cost them about $238M to push the stock up. Maybe Jared invested some of the $2B he got into this?
Well, the way this is handled at this kind of level, they wouldn't think it "cost" that much. That's just the cash they need to come up with, but the cost is the difference between what they spend now and what they get when it all setlles.
I could imagine doing this buy, and doing some other things to raise cash and/or hedge the price.
And if the money laundering thing has any substance, then, they buy stock, Donald sells stock, they transfer funds to him.
I'm sure there's no real undue influence there. None at all.
But needing to do this every single day gets expensive. Better to just give Jarod another billion bribe.
This is like how people keep voting against their self-interests because they believe in the "truth" being told by the people they trust.
Recall how people infected by the original SARS-CoV-2 lineage, on the verge of dying, would express regret for trusting the wrong voices. Yet, people of the same tribe kept trusting those voices even while seeing people in their tribe dying all around them.
How do you change the minds of people who do not want to change their minds?
¯\_(ツ)_/¯
Some of the antivax and/or antimask dead never expressed any regrets. It really is easier being stupid, because it often means you’re too stupid to realize your mistakes too.
Brings to mind the old saying about "a fool and his money." Or in Dubya's formulation, "You can fool some of the people some of the time and some of the people all of the time. Them's your base."
I have a feeling that buying right now is just to close out short positions by people that don't feel like waiting 6 months for when it really tanks. I'd be surprised if Trump actually realizes billions on this deal as there just aren't going to be enough buyers when he wants to sell. If Trump wins election, will his DOJ investigate stock transactions that look like outright bribes? I'm guessing they will not.
They may have short contracts too figuring the value would drop when the shares were diluted.
You’re not thinking like a money launderer. Buyers might emerge on the day Trump wants to sell precisely because they need a mechanism to give him money without directly giving him money. Buying millions of shares of stock on the exact same day Trump sells millions of shares of stock is a great way to get around money laundering regulations. The buyers in this case actually want to “lose” money, as long as most/all the losses accrue specifically to one seller: Trump.
At 700% interest, shorts selling now are loosing money. the only time the shorts could make money was when it was trading at $25.
This seems like a near perfect way for a foreign interest with deep pockets to put money into the former guy's hands without an obvious paper trail.
The 21st Century!
Yeah, but don't those people kind of deserve to lose everything? They decided to hitch their star to a raging bigot with a long history as a grifter. Nobody made them buy the stock. What happened in Atlantic City is not a mystery. After that, if you give him your money, you kind of deserve what happens to you.
Curious, are any of these supporters signed up with "Truth Social"?
Quelle couleur est cette tulipe ?
"So many people are going to lose their life savings over this."
They will blame the Jews
I know we will see stories about the random Joes who are investing and swe them again when they lose all of their money....but I suspect that most of the money is coming from people who know exactly what they are doing. This is not an investment, it is a donation. Or a gift. or a bribe.
How is the SEC not all over this? It's a textbook pump-and-dump scheme.
Exactly.
The regulators are owned by the regulated. See Boeing-FAA for another example of federal agencies that should’ve been all over something somehow just not being there at all until Major Bad Things happened. Most federal regulatory agencies now are just in the business of cleaning up after messes threaten rich people or corporations’ wealth, not preventing the messes from happening at all (and certainly not preventing messes from falling on poor or middle class people).
It's not a pump-and-dump scheme. They require false or misleading statements. Usually, they are conducted by a broker rather than the company itself.
DJT has published its financials, with lots of disclosures. If people don't believe that it is hopelessly overvalued, it's because they don't want to know. All of the necessary information is publicly available.
Note that "false or misleading statements" does not include general puffery. It has to involve specific false claims about either the company's financials, or about specific future actions.
Normally, I'm averse to collective punishment, but in this case it's appropriate. Very much so.
We should care less if these small investors lose everything. They are not our friends. They are profoundly stupid. They support a fascist. Let.Them.Drown. Better - throw them an anvil. Our empathy is not earned or deserved. I've been trying to figure out a way to get in on this and sell these morons something to generate passive income but haven't been able to come up with anything legal - yet.
As for the institutional investors, this is not a scam for them. It's business. As has been said by many here, this is 1) bribe money carefully followed by Trump and/or 2) an efficient way to transfer funds that are otherwise campaign contributions and/or 3) both. Depending on where the big investors are from, this is a sunk cost and they don't care because theoretically, they get a capital gain's loss - for years. None of the New Confederate Party rubes are going to get that particular benefit, even if they had the bandwidth to use it for tax purposes.
"So in one day, in which nothing happened, the paper value of the company went from $4.4 billion to $6.1 billion. That's an increase of nearly 40% in an already valueless company for no reason whatsoever."
This just shows you don't understand basic finance.
Last week, we all knew that the stock would be issued. Today, we all knew the stock was issued. The only difference between the two statements is the tense.
I KNEW the stock would be issued. So I made my decision on whether or not to buy LAST week based on the FACT that the stock would be issued.
When you look at earnings per share, you should pay attention to Fully Diluted EPS because you assume people will use their heads and convert options and other instruments into common stock when it makes sense.
In short, we all knew the number of shares that would be issued this week.
What I can't explain is why the stock is worth more than a few dollars. The only reason it isn't worth $0 is because there is a chance that President Trump will eliminate all of the companies competitors next year and DJT will be given a profitable monopoly.
"So many people are going to lose their life savings over this."
"If God did not want them sheared, He would not have made them sheep!"
If you watch the Retro sub-channels, you see the reverse mortgage ads and the Buy Gold ads. The latter feature genuine buyers/suckers fondling their gold coins like Scrooge McDuck, basking in the glow.
I usually change the channel.
How are reverse mortgages a scam?
The idea isn't a scam. It's just that there's a lot of people who do it as a scam.
Gold is a real thing, and people have real reasons to buy it. AND, there are lots of scammers selling it for bogus reasons.
"Gold is a real thing, and people have real reasons to buy it. " That's not really true. The majority of mined gold is simple put in bank vaults in perpetuity. There is no rational justification for that. The vast majority of the rest is used to make jewelry. Not a complete waste but no where near enough to justify gold from trading at less than 1 tenth of it's cost.
It is used in electronics and some electrical components, as well.
There are probably other legit uses of gold. I consider "putting it in a bank vault" as a legitimate use, by the way.
And there are still scammers aplenty.
any idiot who puts his faith (and money) in dozing donald trump truly is an idiot.
I hope they all lose everything.
Punishment for past stupid behavior is the only possible thing to prevent future stupid behavior.