How to support your favorite dictator without your donation being traced? Maybe buy stock in a blank-check company that would then merge with the dictator’s unprofitable social media company? I guess if the valuation of that blank-check company, Digital World, is being driven up by domestic meme stock (greater fool) investors, that would be one thing. But can the SEC track foreign “investors” funneling potential billions in non-campaign contribution campaign contributions to said dictator wannabe? I don’t know much about this type of “investing,” but it sounds completely scammy. Are Victor Orban’s goons buying these shares? Putin’s crime buddies? Jared’s Saudi friends?
Here below the fold are some quick quotes from the CNN article, but I encourage you to click the link and post additional ideas about all this. I will make corrections if necessary. But it seems under-discussed in the whole security risk debate.
“The stock price is clearly a bubble,” Yale law professor Jonathan Macey told CNN. “No rational investor would take the stock at face value, especially if they had to hold it for any length of time.” SEC filings indicate Trump Media’s revenue amounted to just $1.1 million during the third quarter. The company posted a loss of $26 million that quarter.
And yet Trump Media is being valued north of $6 billion on a fully diluted basis, which includes all stocks and options that could be converted to common stock, according to Jay Ritter, a finance professor at the University of Florida.
Ritter said the current market price is hard, if not impossible, to justify. “It is grossly overvalued,” said Ritter. “It qualifies as a meme stock for which the price is divorced from fundamental value…Meme stock investors are usually buying on the basis of the greater fool theory of investing: It is overvalued today, but I hope to make money selling it to an even greater fool tomorrow at an even higher price.”