No, Trump is not getting $3 billion from Truth Social

[edhopper]

The amount is based on the value of Trump's shares in the new merged company. It is also based on the projected price when the stock goes public. Trump has to wait six months before he can sell. So that $3 billion is based on him selling ALL his shares, but we have no idea what a company with no assets, few subscribers and no advertisers will be selling for in 6 months.
This is why no company would give him the bond with the shares as collateral.
This whole merger is a shell game done to help Trump and put him in debt to whoever controls Digital World (based in WuHan, China)
Of course other foreign friends can help him by pumping up the stock price, but one hopes the SEC keeps an eye on that.
One wonders if a President in debt to foreign entities would have any resonance with voters?

[Johonny]

1. The value obviously goes way down

If a major share holder suddenly dumps 3 billion in shares. Like most of Trumps assets, it's only paper money.

[RevBrotherThomas]

15. Like the presidency & his constituents

trump doesn't give a tinhorn shit about the company nor its shareholders. He cares about how it affects him personally. If it can enrich him and/or keep him out of jail, it's good stuff. If not, well...

[CincyDem]

17. Not necessarily.

It only goes down if there are no buyers. But…if the purpose of tgd transaction is to funnel cash to Trump, someone could support the price as a buyer.

[Johonny]

24. Its up big today so far

Shorts will be all over it after November.

[CincyDem]

25. oh yeah - on that we agree.

After that...there's no "product" to support the price.

Unfortunately, until then, it's going to be a money IV for him and, IIRC, the FEC doesn't put a limit on how much of their personal money a candidate can spend. This is a grift to turn OPM into TrumpBucks to line his pockets and get out from under all the restrictions on non-US contributions to a political campaign.

What a f'ing grift.

But yeah...short the living chit out of it in mid-October. lolol

[gab13by13]

2. You made a good argument why Trump "may not" get 3 billion,

[Scrivener7]

3. True. But the use of the SPAC is done specifically so the SEC WON'T be keeping an eye on it.

And while we don't know what the final value will be, as you say, it is inevitable that foreign and shady domestic forces will be pumping up the stock. That is the whole purpose of this transaction.

He may not get $3 billion. He may get more. He may get less. But the whole scheme is just a money laundering operation to enrich the vile thing, so I assume he'll net some ungodly amount. Otherwise, they wouldn't be doing it.

[edhopper]

6. Yes

but once it becomes a publicly traded company, the SEC does keep an eye on it. And that is what it is.

[Scrivener7]

7. Not till the merger goes through, and not till he has enough collateral on paper that Deutsch Bank or

some other similar entity can cover its ass and say they are being totally rational lending him billions of dollars. At ridiculous interest rates. As they have done so many times before.

One way or another, in the long run this bails him out. The trick is to ruin him in the short run. That could happen. But despite decades of criminal behavior (I've been watching him since the mid '80s when he bankrupted a friend of my dad's for kicks) it hasn't happened yet.

[TwilightZone]

9. The merger already went through.

Stockholders approved it on Friday and it was signed off on yesterday. It goes public today. I'm not sure where you're getting the stuff on collateral -- none of that applies to the merger or it going public. As for the SEC, it's a publicly-traded company, as noted, so it is under their watch.

The company was created to skip most of the private-to-public process that companies usually have to go through. It was created solely to provide that vehicle for Truth Social's media group. Hence, the merger.

The board of directors could vote to allow Trump a pass on the six-month limit.

https://www.cnbc.com/2024/03/25/dwac-climbs-after-merger-with-donald-trumps-media-group-approved.html

[Scrivener7]

11. The collateral is his stake in the stock on paper. Which is now at $73 per share.

Last edited Tue Mar 26, 2024, 12:48 PM - Edit history (1)

[et tu]

16. also d45 could ask

for and most likely skip the 6 month wait period by submitting a waiver~

[CincyDem]

26. With the way his board is MAGA stuffed...

...he could ask them to eat raw pig hearts on live TV and they'd ask if they should dress formal or casual. They will absolutely waive the 6 month lock-up. In fact, if they haven't done it yet today, they still have time.

[Diamond_Dog]

4. A president in debt to foreign entities, you say?

As long as it’s Trump it’s A-OK.

If it were Biden or any other Democrat, heads in Congress and the Media would be exploding and investigations would be happening pronto.

[ProudMNDemocrat]

5. The Securities Exchange Commission(SEC) does not mess around.

Their jobs are to spot the Securities they deem NOT kosher. Truth Social does not look kosher at all.

[gab13by13]

10. The price is inflated, it is losing money,

it doesn't matter that no intelligent, honest person would invest a dime in it, the scheme is to launder money.

[TwilightZone]

13. They're not going to shut it down just because the valuation is high.

DJT is a meme stock and purely speculative and its valuation doesn't have any basis in the real world, but it's not alone. They're not going to shut it down simply because the valuation doesn't meet the level of assets or income. Nvidia, a company with about $40b in assets, has a valuation of more than $2 trillion.

[ecstatic]

8. If he's able to walk off into the sunset with 3 billion dollars

in 6 months... It would say a lot. Criminals all over the world would have to give the American stock market a second look. With the current ease of entry and access to the stock market, I think the "powers that be" would finally lose control.

[gab13by13]

12. Smart investors aren't going to invest in DJT,

The Saudis or whoever are laundering money to Trump. The thing is though the stock price in 6 months may not be what it is right now, right now the price is inflated, maybe the Saudis can keep inflating the price, money is no object to them.

[dembotoz]

23. don't be so sure buying a share could be viewed as a patriotic gesture

a fool and his money are soon parted and maga has lots of fools

[Scrivener7]

14. The price this morning is $73. If that holds, he'll get a lot more than $3 billion.

[SouthernDem4ever]

21. How ridiculous. Just goes to show how great is to have my retirement dependent on a market of nonsense.

[dumbcat]

29. So how does that work?

Right now the price is $72.40 and the total market cap is 2.68 Billion. How would his portion of the total shares get above 3 billion at the same price?

[Scrivener7]

30. In Feb, when the stock worth was estimated at $48, the estimate of the value of his personal stake was $3.8 billion.

Now the stock is selling at $73.
https://www.marketwatch.com/story/cha-ching-trump-makes-4-billion-from-his-re-election-campaign-5fb87700

Where is the 2.68 billion coming from? I'm not saying it's wrong. These numbers are all over the place, and who knows where Marketwatch got theirs, but who is saying that's what it is?

[dumbcat]

33. I got the market cap from

the Yahoo Finance summary page for DJT. It now shows total market cap at 2.15B. Morningstar page shows it at 1.86B. That's why I was wondering how his shares could be valued at 3 billion.

[SouthernDem4ever]

36. If it were $10,000 it would be over-priced.

Shows the ignorance of the stock market.

[Scrivener7]

37. So I wonder which is correct. Morningstar and Marketwatch are both decent sources.

And here is another completely different set of numbers from AP: https://www.democraticunderground.com/10143216118

Either way, he's pulled a money laundering scam and his money troubles are over. And that pisses me off.

[DoBW]

18. Wu Han ??!!

Wasn't that Covid19 ground zero ??!! -- more China Trump ties. WTF ??!!

[iluvtennis]

19. Thanks for this post that clearly breaks down the truth social stock situation. n/t

[gab13by13]

28. Does it really?

[iluvtennis]

32. Yes, it does for me. It says there is no immediate $3 Billion windfall for trump. He has to wait 6 months

before he can sell the shares. And in 6 months who knows what the value of the shares will be. They could easily go down to penny stock level.

[czarjak]

20. Gee-Whiz...

I'm hopeful Dev's okay.

[WarGamer]

22. Like Mark Cuban said the other day...

Net worth isn't "cash in the bank"

Trump has $5-6B "on paper" in DJT stock...

[BlueKota]

27. Trumpers will say it's made up Democratic propaganda that he's in debt to foreign leaders

[Straw Man]

31. Can you say "pump and dump"? I knew that you could ...

Maybe I'm missing something, but isn't it clear that that's what he plans to do?

[Emrys]

34. It's just another NFT

No Fuckin Truth

[LetMyPeopleVote]

35. DJT is a meme stock that relies on the greater fool/idiot theory

Meme stocks rely on the greater fool theory. I was amused to see that DWAC/Trump Media is classified as a meme stock where the value is due to personality and not due to the real value of issuer of the meme stock. This article is a good discussion of the meme nature of DWAC/TMT.
https://www.vanityfair.com/news/donald-trump-truth-social-media-merger

Trump’s financial future now hinges on some of the strangest fads in corporate finance—meme stocks, SPAC deals, and cult-of-personality investing. If Trump can find a way to act fast, it might just be the bailout he desperately needs.

Truth Social is a bad imitation of Twitter, where Trump was an unavoidable presence long before he ran for president. It’s chock full of stale red-pilled memes, MAGA conspiracy theories, and of course, Trump. That’s the main draw. Truth Social is the only place the former president now regularly posts his unfettered thoughts......

DWAC is best thought of as a meme stock. You may remember the meme stock fad from when retail investors on Reddit successfully coordinated a short squeeze with GameStop stock, before glomming onto a series of other millennial nostalgia brands like AMC Entertainment, BlackBerry, and Bed Bath & Beyond. Meme stocks are often publicly traded companies that attract an inordinate percentage of individual investors and their stock performance fluctuates in a way that’s significantly divorced from the reality of their underlying business. Combine those two trends and you’ll start to see why Trump’s media company could be valued at roughly $9 billion if it merges with DWAC.

Jay Ritter, a finance professor at the University of Florida, says meme stocks often depend on the “greater fool theory of investing,” meaning rational investors might buy in expecting the stock price to rise and betting that they can sell their shares to a greater fool willing to buy them at a higher price. In this case, however, Ritter speculates there is an inordinate number of individual retail investors compared to institutional investors, such as hedge funds, that normally own SPAC shares prior to a merger. “Here you’ve got ideology involved [too]—as far as I can tell, the vast majority of DWAC investors are Trump political investors, and they’re to some degree putting their money where their mouth is… My suspicion is most of them have bought the stock as a show of political support.” In this way, Trump is conducting yet another public fundraising from his supporters—this time through the public markets.

Idiots who purchase meme stocks are betting that they can get out before the other idiots figure out that the stock is worthless