You see that dip, where the stock starts to go back up? You know what Truth Social did that reversed that trend?
Not one god damned thing.
But you know what else was going on then? That was right in the middle of the “if DJT stock stays above $30/share for 20 out of 30 days, Trump gets a shitload more money” window. Almost like someone started manipulating the stock so Trump would get money and maybe owe some favors…
Look at their 10Q. The majority of their loss was from revaluation of derivative liabilities. If anyone with more Equity Research experience cares to look at p. 14 and care to explain further.
I’m no money scientist, but is that the thing where they decide it’s worth more? So they can sell it for more money, the thing Trump has been known to do? That thing?
I’m not familiar with the mechanics, but the specific derivative valuation method was listed at Level 3 which is used for transactions that rely on unobservable factors to evaluate value.
Level 1 derivatives are like interest rate swaps where there is a liquid exchange market that can easily be valued.
Level 2 derivatives are like Futures contracts where the terms may be more bespoke, but value can be derived from an established market.
Level 3 derivatives I’ve seen described in textbooks as marked to magic lol. Meaning there is no liquid market to mark the value to.
Somehow, they categorized an instrument that was used to fund the SPAC as a Level 3 derivative. That on surface sounds incorrect for an option or debt conversion of a publicly traded stock.
This should trigger an audit or something by the regulator, but again, my area of expertise is in Corp Finance, not Treasury.
Thing is that you can use math to find actual value. But, if I warmed up a financial calculator and follow the steps, I’m pretty sure this company has negative actual value, and that’s saying something since even companies with no assets and revenue have small value.
More than one conservative person has gone on TV and explicitly said, this Truth Social thing is great because you can funnel money to Trump just by buying some of the stock, and it's perfectly legal and more or less completely secret.
The value of the stock finds its own natural balance based on supply and demand -- he has like $5 billion worth of shares, but he can't sell it and get anywhere near that much money, because the value will plummet if he starts selling in any big amount. But, if people are buying the stock, then the value goes up, and he can sell some, and the value will level off back down, and so on.
Basically the dollars that get spent on this stock that has no real inherent value will get routed into a big inflatable balloon of money to blow it up a little more, and then Trump can take some out, and the balloon will deflate a little but still maintain enough pressure that the balloon survives. The dollars that went in don't need to be the same dollars that came out for the system to still work that way.
Its a bet a lot of people are making. If Trump wins the shares of this stock are probably going to the moon to borrow a phrase. Truth social will be where the President of the US is. Users/advertisers will move there initially I think, until they realize it is somehow worse than Twitter. It will also be, and probably already is, a way to subvert campaign finance laws and donate “directly” to Trump.
The price is artificially high becuase of people making this bet. If Trump loses this goes the way of Trump steaks, Trump vodka, Trump University, etc. If he wins, these people may literally make money hand over fist.
Trump winning doesn’t do anything except make it a way to bribe the president. Everyone knows who/what are on that site. It’s not going to make advertisers go there. It’s already the place of the loudmouthed former president, which probably gets more users than it being the site that had the president.
And that’s because it’s up over 200% from its low at $22. With these financials the “free market” decided it was a heavy buy. It’s some combination of meme stock and corruption vessel. Trump gonna get elected and we’ll all be fools for not taking our cut as the bribes really flow in. Unlikely Trump even “steps away” from his businesses next time. He’ll be (openly) taking private investor meetings in the Oval Office before deciding their government petition.
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