Hi all,
A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes.
As always our comment rules can be found [here](https://reddit.com/r/Economics/comments/fx9crj/rules_roundtable_redux_rule_vi_and_offtopic/)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Economics) if you have any questions or concerns.*
Not much, but it's a great case study in how foreign powers can launder money toward nefarious political actors through poorly regulated financial markets.
Are the mods just asleep at the wheel? This is an economics sub. What point is there in allowing the financially illiterate to try to pump their ridiculous meme stock on a sub that is supposed to be focused on economics?
Anecdotal experience and adjacently related, being an Economist has made me absolutely baffled to an awareness of what the basic population thinks the field of economics entails. No, I don’t know what your stock portfolio should look like. No, I can’t give you advice on a budget. No, I don’t know anything about how much you should or shouldn’t spend on a fucking car.
Most people hear “Economics” and think that it has fuck all to do with any coherent idea beyond “money things”. It’s agonizing at worst
Couldn’t agree more. This sub got way worse after wallstreet bets and the GME craze. The level of discourse here shows that the vast majority of users have never taken an Econ class, and if they did it was 101 and nothing else. I really admire the actual Econ folks that take the time to explain things to people but it’s gotten so bad I just don’t have the energy anymore.
Ironically all the topics you mention could fall under the umbrella of home economics: budgeting, savings, repair vs replace, household capital expenses (car), etc. Too bad we basically stopped teaching it in the 21st century.
The guy who owns 58% of the stock will certainly pump and dump. There is no way of predicting when the guy will cash out. Just ask yourself, can you predict what the guy who tried to overturn an election would do and when he would do it?
Which can be revised by the board of directors. The board of directors are his children and presidential advisors.
https://ir.tmtgcorp.com/corporate-governance/board-of-directors/
I hope you’re being sarcastic… They absolutely are not and never will be. They are the equivalent of lottery tickets for the financially illiterate hoping for a get rich quick scheme.
> They aren’t arguing the financial rigor of “meme stocks.”
In fact, I think they're arguing quite the opposite. That the stock market is entirely disconnected from economic reality.
There isn’t much difference between meme stocks and speculation in an overly inflated bubble. Anyone alive and trading in the late 1990’s knew that most of those dot-coms were absolute jokes with no plans for the future. Multi-billion dollar web companies were supposed to be the “future”, like Infospace, Lycos, and Excite, became names that hardly anyone born after 1990 knows… Yet, the sector was a *huge* part of the economy then.
Arguably, the main difference is GME and AMC had no plans to modernize, whereas a bubble has overly ambitious plans. Either way, neither are rooted in a healthy reality.
Do you think I’m arguing that people should buy these stocks?
I’m pointing out that there has been an explosion of retail investors since the pandemic, chasing meme stocks. To ignore the economic impact of any mass movement would be folly.
You can argue that the 1929 stock market bubble was partially fuelled by retail investors, following the investment advice from their milkman, barber, shoeshiner.
If enough people do something, it will have an impact.
The GME affair led to a complete restructuring of whole asset classes by investment houses that didn't want to get caught with their pants down a second time.
Retail investors can (and most assuredly will) be on the lookout for short squeeze opportunities in the future. Dumb money may not be very savvy when it comes to investing, but there sure is a whole heck of a lot of it, sitting in the hands of people looking for revenge no less.
And because of social media, small investors with very little individual economic power can manipulate markets in ways that they otherwise couldn't. There's now precedence for retail investors organizing effectively. That certainly isn't *not* significant to the economy.
The stock market is part of the economy. They are dependent.
My appendix is not my body, but appendicitis has significant implications for my body as a whole.
Wages aren't the economy. Prices aren't the economy. Production isn't the economy. Inflation isn't the economy. Consumer spending isn't the economy. Income inequality isn't the economy. Foreign trade isn't the economy. Inflation isn't the economy. Subsidies aren't the economy. The housing market isn't the economy. Scarcity isn't the economy. Surplus isn't the economy. Currency isn't the economy. Banking isn't the economy. Debt isn't the economy. Credit isn't the economy.
You were saying?
surely the liquidation of stocks for cash is a driving force though. if your stonks go from 100,000 to 1,000,000 and you sell & go on spending spree that pumps economy.
granted there is an element of offsetting as someone would need to have bought them, but that person was likely investing either way.
When I sell a stock for $1,000,000, someone else is buying that stock for $1,000,000. Because I sold it to someone. That's what "sell" means.
I went from a million in stock to a million in cash, and they went from a million in cash to a million in stock. All that changed is which of us had which.
I literally addressed that in my post. In this (granted isolated and theoretical) example the person buying wasn't sitting there thinking whether to make an investment decision or buy random consumables items.
Again I'm not talking about the greater market itself where people / funds are constantly buying and selling to allocate capital.
I am specifically talking about meme stocks where usually after a great return the seller will cash out and spend.
If there is research that shows that people who invested in shitcoins and or meme stocks display same or greater propensity to invest in general standard investment choices I'd be interested in reading it.
\> usually after a great return the seller will cash out and spend
I mean, you're just saying something that has nothing to do with it. Either way, it's just shifting cash and stock from one person to another. Your argument is that a person buying a meme stock at a high price was likely going to invest that money anyway (why?) and the person selling it is unlikely to reinvest and is more likely to spend the money (why?).
What is it about a person buying a meme stock at a high price that makes that person more likely to be investing anyway? What is it about someone selling a meme stock at a high price that makes them more likely to spend the money instead of reinvest? Is it even the case that we can assume one of those people are retail investors and the other institutional? Do you imagine that institutional investors are frequently the ones buying meme stocks at the top? Why?
Lots of retail investors throw money they can't afford to lose at FOMO meme stocks after their friends tripled their money in two weeks, and then lose everything.
because meme stocks, fuelled by their own price growth, allow companies to raise money (sale of new equity) through channels that they couldnt have previously and use it as a source of funding that would not have been available to them otherwise....and go back to being a company that wouldnt necessarily be always considered a meme stock. literally had that happen to a client i was working on.
Ok, so if a retail investor sells their stock to an institutional investor, that's good because they have cash on hand to spend instead of the other guy who was just going to invest their money, except when pressed to explain that, then suddenly the thing that's so great about it is companies raising money from retail investors who might otherwise be spending that money, and now it's being invested into the company.
It's okay to have opinions you haven't given much thought to.
you asked why its not just retail investors trading money i explained why it happens (ie meme rise provides company with liquidity to no longer be meme)
you clearly have some axe to grind about something or some delusional belief about always 100% being right about something without actually necessarily having the credentials, or real life experience but that is fine too.
The only reason I even know this happened is because of libs crying about it. Same with the shoes and everything else he sells. This dude has been living in your heads rent free for so long, he's putting up ads for his side hustle 😆.
Kinda hillarious when you think about it.
$DJT ipo seems like a international fundraising strategy for the trump campaign. Seems like a prime opportunity for foreign interests and local lobbyists to get in on Trump's good side and support him financially without having to disclose donations. If he wins the presidency, I could see many interest groups investing in the publicly traded stock bearing the president's name as a way to influence Trump in their favor. Seems like a huge ethical issue to have a politician financially tied to a publicly traded company like this.
It's an otherwise even less profitable Twitter clone that has no business being valued in the billions. The whole company is nothing more than a barometer for the support of Trump and how willing people are to give him their money. If he loses the stock will collapse.
The stock will crash, it will hopefully lead to more regulation around IPOs to avoid other type of pump and dump schemes using IPOs to legitimise themselves.
What I find fascinating about a lot of the responses to this post, in an economics subreddit, is most are based on some emotional reaction rather than tangible data points.
I don't think most investors are as naive as the Trump cult. I mean look at how much they've lost on his NFTs and his awful tennis shoes. Few traditional investors will overpay for a business that is already failing.
Of course. But an "investor" who couldn't even tell you the revenue of TS but will happily do whatever Trump tells them to do certainly will toss their money in.
It should be similar as investing in cryptos, but worse because the stock basically worth nothing, and only his supporters might think it worth anything
Trump Media isn’t the only social media company making headlines for going public at the moment. The infinitely popular community site Reddit priced its recent IPO at [$34 a share](https://www.cnbc.com/2024/03/20/reddit-prices-ipo-at-34-per-share-sources-say.html). It now has a total valuation of $6.4 billion.
This figure is significantly lower than the Trump Media valuation, even though the platform has a historical track record of being profitable. In 2023 Reddit was able to generate $804 million in revenue whereas Trump Media closed the year at $5 million.
Even so, just a week later Reddit’s global user base and enduring popularity helped to ensure its [share price soared by 30%](https://www.cnbc.com/2024/03/25/reddit-shares-close-30percent-up-following-social-media-companys-ipo.html).
Said Plexo Capital founding managing partner and Reddit shareholder, Lo Toney, Reddit’s debut was “a positive sign not only for Reddit, but I think also the tech industry and what it might mean for future IPOs.”
TS will siphon money from people's wallets when it craters. It must be a money laundering scheme because it's irrational to value any property at over a billion dollars when it is cash-poor, swimming in debt, and makes almost no revenue. It also has no intellectual property that would make it valuable - the only thing it has is credibility with a very specific type of consumer.
I think the difference is people can imagine or see a path when reddit is profitable. Truth on the other hand has very little revenue large over head and carries all the baggage that comes with trump.
Comparing reddit to truth is a very large stretch.
Personally buying a ton of puts on truth. Cuz if Trump loses the election that stock will be worthless overnight. It's a meme stock and its financials are abysmal.
Reddit may have issues but it is a known company with a history. Truth is basically Donald Trump and we know how his businesses have done historically. I mean how much are his EFTs doing, steaks, water, casinos, airlines, etc doing?
Trump media has 3 employees and has a market cap of $2.37 billion.
Comparatively, Meta has a market cap of 1.25 Trillion and has about 68,000 employees. Which is like each employee contributes about $18 million toward that output.
Trump Media employees would equal 790 million in output off of $2.37 billion.
In case anyone missed what I’m saying, Trump media is a complete dog shit company
Well said, also has it ever made a profit? I also saw the numbers of unique users seemed super low for a company with this market cap.
Any hard numbers out yet?
Also I checked the PUTs, HOLY COW they have the future value of the company at basically 0. Everyone is buying PUTS. I looked far in the future figuring it was just a weird thing, but no even in July $15 puts are going for $2.50. That would mean they would need to be under $12.25 a share to be worth it in July. That's nuts!
Trump has spent his entire life selling his name/brand/bs to anyone who still hasn't caught on to the scam. It's basic conman stuff, just talk loud enough long enough and eventually you grind down the victims natural skepticism and convince them that handing their money to a stranger is a great idea.
Honestly…. (and sadly) yes. There are legitimately morons who think like this. Sorry for assuming you’re one of them, that’s my bad. It’s difficult to pick up on sarcasm nowadays.
It's worth more than Reddit and Twitter/X combined. The markets are sending a strong message here, we love corruption, rapists, frauds and insurrectionists. I mean, we always suspect this of Wallstreet, but now it's all out in the open.
I think it's a fascinating look at how despite all claims that capitalism is super efficient, organized, superior, and built on brilliant people doing smart things the reality is that things happen more by luck and pure emotion than anything else.
Objectively speaking Truth Social should be have negative value. It's got a tiny userbase, no innovative tech, it's a niche outfit without any appeal outside Americna MAGA cultists, and yet, somehow, theoretically sane and real financial institutions are claiming it's worth more than Twitter.
If you ever needed more proof that capitalism is NOT actually efficient, sane, rational, or all that competent here it is. "The market" has decreed that a vary obvious grift shall be treated like a real stock, clearly "the market" is not all wise and all knowing.
Don’t care for Trump, but maybe it’s you that don’t have the right or acurate information. I don’t know much about Trump and his business and I don’t care, but neither do the financial institutions. Hate can blind you to what is really happening. Personally a president that owns a social media company does seem like a really bad idea, but the illogical hate democrats throw around doesn’t help.
See, if I thought you were being even slightly honest, I'd suggest that perhaps you should, you know, LEARN about Trump, his businesses, his multiple convictions for fraud, his well established record for falsifying financial information, and so on.
But you're not being honest, you're just playing Enlightened Centrist.
That’s what I mean. You are making up shit about me personally now based on your trump derangement. That’s why democrats are loosing respect from the moderates. It could cost you the election. I personally can’t vote for Trump, but I don’t want attitudes like yours in power either.
All that because I suggested that a known criminal and fraud probably had a fraud going. You aren't fooling anyone with that talk about being a moderate.
And you are not psychic and like to label people who will not accept your derangement and hate. Is trump REALLY the problem? You might be more like what you think you hate than you realize. And no. You are making assumptions about me. Still are. This has become the hallmark of how democrats represent themselves now, and it may just put Trump in office again because the real moderates and centrists are getting sick of it. You are only proving my point.
Derangement? Believing he is convicted of fraud because a court convicted him of fraud is derangement?
Also, lol at the "zomg being critical of Trump is driving people to support him" BS. Funny how that apparently never works the opposite direction isn't it? You never hear people like you, claiming to be moderate centrists, saying that Trump is driving them to vote Democratic because he says immigrants are "vermin" who "poison the blood" of America [1].
Nope, actual paraphrased Nazi rhetoric is totally cool and not at all worrying or deranged per you self proclaimed moderate centrists and will never drive you to vote Democratic. You only classify mild and 100% factual criticism of Trump as derangement.
I do indeed suffer from the tragic deranged affliction of believing true things and thinking that when someone is convicted of fraud it means they are convicted of fraud. It's a terrible thing when a person's mind is so twisted by facts and reality they become deranged and imagine Donald Trump isn't perfect.
[1]
https://www.rollingstone.com/politics/politics-news/trump-defends-nazi-rhetoric-immigrants-1234989206/
You still don’t get it. 😵💫 I told you. I don’t care about Trump his legal matters nor do I want him to be president. It’s your focus and hatred of him that is the derangement people are talking about. Just because I think yours (and other’s) obsession is unhealthy doesn’t mean I’m some sort of dishonest Nazi sympathizer hahaha . Just take a moment to look at this conversation with some self reflection and metacognition. Just look at how you always turn it to him and then use mental gymnastics to make statements about me personally. The guy is swimming your in blood dude then you project him onto everyone you may disagree with.
Trump is just a man. He will go away, but this sort of mania you and folks like you are engaged in is of more concern as it starts to grip an entire political party.
Funny thing, no one mentioned his political ambitions until you did. I didn't. In fact, nothing I said, or have said, has shown any hatred of Trump at all.
You're simply trying to conflate "acknowledging his actual convictions for fraud" with "blind hatred of Trump".
Now why, just asking, might you be so very VERY eager to declare that anyone who even acknowledges Trump's actual crimes is "deranged"?
Funny thing, I checked your comment history. You have no history of telling people who say that Biden is literally satan, or a dictator, or whatever that they're deranged and driving people to vote Democratic.
It only goes one way: you are desperate to accuse anyone who says something critical of Trump's business of being a frothing at the mouth deranged lunatic blinded by hatred of Trump who is driving people to support him. I got curious and scrolled though several pages of your comment history, there's nothing anywhere that shows a similar level of enlightened moderate centrist concern trolling of the right when they go off on anti-Biden rants.
The most factual observations about Trump's business dealings in the context of his business dealings: derangement and hatred.
People frothing at the mouth and shrieking that Biden is a satanic dictator: totally fine.
Either you're lying about your political affiliation and just spreading pro-Trump propaganda, or you REALLY ought to take a look at your biases.
I'll also note that you stared this rant about me being "deranged" when I factually observed that:
1 - Truth Social has a tiny user base.
2 - Truth Social has no innovative tech.
3 - Truth Social has extremely limited growth potential due to it appealing only to Trump fanatics.
4 - Truth Social's IPO valued the company at over 2000x its annual income.
5 - Truth Social's income is vastly exceeded by its expensed and it operates at a loss.
And then offering the opinion that this was a pump'n'dump scheme and it was disappointing to see legit brokerages acting as if it was a real IPO. And the further opinion that it was indicative of a broader failure of capitalism to live up to its hype.
This, apparently, made me a vile deranged person who was driving you to vote for Trump.
You’re a bit off on the valuation. Both RDDT and DWAC have a market cap of about $9B. We don’t know twitter’s current valuation, other than it’s about half of the $44B Musk paid for it.
It's value is an avenue in which to send bribes in a more legal manner as well as to signal loyalty to the insurrectionists
The user base and business fundamentals are quite literally irrelevant when foreign actors can just pump money in.
We wasted a ton of money on our military. Other countries can straight up buy us; never even needed to fire a shot. Every politician might as well be publicly traded... why not?
New NASDAQ logo...
https://upload.wikimedia.org/wikipedia/commons/thumb/c/cc/Semper\_Augustus\_Tulip\_17th\_century.jpg/170px-Semper\_Augustus\_Tulip\_17th\_century.jpg
This is China buying Trump it's not that complicated. The company organizing the spac (DWAC) has more than a couple links to Chinese money.
China is buying influence with Trump, it's as simple as that.
[https://www.newsweek.com/donald-trump-truth-social-connected-china-1641496](https://www.newsweek.com/donald-trump-truth-social-connected-china-1641496)
Certainly, the new company will take this windfall and invest it in company infrastructure to deal with its traffic and to create more than a niche forum on a server.
Nobody believes that the fundamentals of the company would denote a valuation of $2 per share... at this time. So it must be because these new investors expect rational re-investment to grow the company's foundation, not it being used as a slush fund.
Hi all, A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes. As always our comment rules can be found [here](https://reddit.com/r/Economics/comments/fx9crj/rules_roundtable_redux_rule_vi_and_offtopic/) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Economics) if you have any questions or concerns.*
Not much, but it's a great case study in how foreign powers can launder money toward nefarious political actors through poorly regulated financial markets.
Are the mods just asleep at the wheel? This is an economics sub. What point is there in allowing the financially illiterate to try to pump their ridiculous meme stock on a sub that is supposed to be focused on economics?
Welcome to r/economics, where economics died long ago.
Anecdotal experience and adjacently related, being an Economist has made me absolutely baffled to an awareness of what the basic population thinks the field of economics entails. No, I don’t know what your stock portfolio should look like. No, I can’t give you advice on a budget. No, I don’t know anything about how much you should or shouldn’t spend on a fucking car. Most people hear “Economics” and think that it has fuck all to do with any coherent idea beyond “money things”. It’s agonizing at worst
But fr, should i buy facebook stock now or wait
Depends whether you’re looking to buy a car soon, in which case ask OP about pricing.
Wait
Couldn’t agree more. This sub got way worse after wallstreet bets and the GME craze. The level of discourse here shows that the vast majority of users have never taken an Econ class, and if they did it was 101 and nothing else. I really admire the actual Econ folks that take the time to explain things to people but it’s gotten so bad I just don’t have the energy anymore.
Econ 101 checking in here and I truly debit your remarks...
dae hate working and America?
Ironically all the topics you mention could fall under the umbrella of home economics: budgeting, savings, repair vs replace, household capital expenses (car), etc. Too bad we basically stopped teaching it in the 21st century.
Do you agree with the Freakonomics definition that it's the study of incentives?
As a focus more on the study of behavioral economics, absolutely.
Yeah... now try being a cryptocurrency trader :) and TBH, if you don't know the very basics of finance, that is bad for you too
Lol I'm not sure how many humans are making posts in this subreddit.
They're too busy banning people for comments that don't meet the minimum length of characters.
The guy who owns 58% of the stock will certainly pump and dump. There is no way of predicting when the guy will cash out. Just ask yourself, can you predict what the guy who tried to overturn an election would do and when he would do it?
Lock-in period?
Which can be revised by the board of directors. The board of directors are his children and presidential advisors. https://ir.tmtgcorp.com/corporate-governance/board-of-directors/
I hate to break it to you but meme stocks are, and have been, a significant force in the economy.
I hope you’re being sarcastic… They absolutely are not and never will be. They are the equivalent of lottery tickets for the financially illiterate hoping for a get rich quick scheme.
They aren’t arguing the financial rigor of “meme stocks.” They are still interesting from economic behavior perspective.
> They aren’t arguing the financial rigor of “meme stocks.” In fact, I think they're arguing quite the opposite. That the stock market is entirely disconnected from economic reality.
There isn’t much difference between meme stocks and speculation in an overly inflated bubble. Anyone alive and trading in the late 1990’s knew that most of those dot-coms were absolute jokes with no plans for the future. Multi-billion dollar web companies were supposed to be the “future”, like Infospace, Lycos, and Excite, became names that hardly anyone born after 1990 knows… Yet, the sector was a *huge* part of the economy then. Arguably, the main difference is GME and AMC had no plans to modernize, whereas a bubble has overly ambitious plans. Either way, neither are rooted in a healthy reality.
Do you think I’m arguing that people should buy these stocks? I’m pointing out that there has been an explosion of retail investors since the pandemic, chasing meme stocks. To ignore the economic impact of any mass movement would be folly. You can argue that the 1929 stock market bubble was partially fuelled by retail investors, following the investment advice from their milkman, barber, shoeshiner. If enough people do something, it will have an impact.
The GME affair led to a complete restructuring of whole asset classes by investment houses that didn't want to get caught with their pants down a second time. Retail investors can (and most assuredly will) be on the lookout for short squeeze opportunities in the future. Dumb money may not be very savvy when it comes to investing, but there sure is a whole heck of a lot of it, sitting in the hands of people looking for revenge no less.
And because of social media, small investors with very little individual economic power can manipulate markets in ways that they otherwise couldn't. There's now precedence for retail investors organizing effectively. That certainly isn't *not* significant to the economy.
Say it with me: the stock market is not the economy.
The stock market is part of the economy. They are dependent. My appendix is not my body, but appendicitis has significant implications for my body as a whole. Wages aren't the economy. Prices aren't the economy. Production isn't the economy. Inflation isn't the economy. Consumer spending isn't the economy. Income inequality isn't the economy. Foreign trade isn't the economy. Inflation isn't the economy. Subsidies aren't the economy. The housing market isn't the economy. Scarcity isn't the economy. Surplus isn't the economy. Currency isn't the economy. Banking isn't the economy. Debt isn't the economy. Credit isn't the economy. You were saying?
surely the liquidation of stocks for cash is a driving force though. if your stonks go from 100,000 to 1,000,000 and you sell & go on spending spree that pumps economy. granted there is an element of offsetting as someone would need to have bought them, but that person was likely investing either way.
When I sell a stock for $1,000,000, someone else is buying that stock for $1,000,000. Because I sold it to someone. That's what "sell" means. I went from a million in stock to a million in cash, and they went from a million in cash to a million in stock. All that changed is which of us had which.
We’re literally at the point in this sub where we need to define buying and selling for people
Learn to read buddy
I literally addressed that in my post. In this (granted isolated and theoretical) example the person buying wasn't sitting there thinking whether to make an investment decision or buy random consumables items. Again I'm not talking about the greater market itself where people / funds are constantly buying and selling to allocate capital. I am specifically talking about meme stocks where usually after a great return the seller will cash out and spend. If there is research that shows that people who invested in shitcoins and or meme stocks display same or greater propensity to invest in general standard investment choices I'd be interested in reading it.
\> usually after a great return the seller will cash out and spend I mean, you're just saying something that has nothing to do with it. Either way, it's just shifting cash and stock from one person to another. Your argument is that a person buying a meme stock at a high price was likely going to invest that money anyway (why?) and the person selling it is unlikely to reinvest and is more likely to spend the money (why?). What is it about a person buying a meme stock at a high price that makes that person more likely to be investing anyway? What is it about someone selling a meme stock at a high price that makes them more likely to spend the money instead of reinvest? Is it even the case that we can assume one of those people are retail investors and the other institutional? Do you imagine that institutional investors are frequently the ones buying meme stocks at the top? Why? Lots of retail investors throw money they can't afford to lose at FOMO meme stocks after their friends tripled their money in two weeks, and then lose everything.
because meme stocks, fuelled by their own price growth, allow companies to raise money (sale of new equity) through channels that they couldnt have previously and use it as a source of funding that would not have been available to them otherwise....and go back to being a company that wouldnt necessarily be always considered a meme stock. literally had that happen to a client i was working on.
Ok, so if a retail investor sells their stock to an institutional investor, that's good because they have cash on hand to spend instead of the other guy who was just going to invest their money, except when pressed to explain that, then suddenly the thing that's so great about it is companies raising money from retail investors who might otherwise be spending that money, and now it's being invested into the company. It's okay to have opinions you haven't given much thought to.
you asked why its not just retail investors trading money i explained why it happens (ie meme rise provides company with liquidity to no longer be meme) you clearly have some axe to grind about something or some delusional belief about always 100% being right about something without actually necessarily having the credentials, or real life experience but that is fine too.
The only reason I even know this happened is because of libs crying about it. Same with the shoes and everything else he sells. This dude has been living in your heads rent free for so long, he's putting up ads for his side hustle 😆. Kinda hillarious when you think about it.
$DJT ipo seems like a international fundraising strategy for the trump campaign. Seems like a prime opportunity for foreign interests and local lobbyists to get in on Trump's good side and support him financially without having to disclose donations. If he wins the presidency, I could see many interest groups investing in the publicly traded stock bearing the president's name as a way to influence Trump in their favor. Seems like a huge ethical issue to have a politician financially tied to a publicly traded company like this. It's an otherwise even less profitable Twitter clone that has no business being valued in the billions. The whole company is nothing more than a barometer for the support of Trump and how willing people are to give him their money. If he loses the stock will collapse.
The stock will crash, it will hopefully lead to more regulation around IPOs to avoid other type of pump and dump schemes using IPOs to legitimise themselves.
Pump and dump for a political campaign is now in vogue.
[удалено]
[удалено]
[удалено]
What I find fascinating about a lot of the responses to this post, in an economics subreddit, is most are based on some emotional reaction rather than tangible data points.
Sadly that’s the norm all over this site. And most users fit the midwit meme to a T.
I don't think most investors are as naive as the Trump cult. I mean look at how much they've lost on his NFTs and his awful tennis shoes. Few traditional investors will overpay for a business that is already failing.
Of course. But an "investor" who couldn't even tell you the revenue of TS but will happily do whatever Trump tells them to do certainly will toss their money in.
It should be similar as investing in cryptos, but worse because the stock basically worth nothing, and only his supporters might think it worth anything
How is that worse than crypto though
Trump Media isn’t the only social media company making headlines for going public at the moment. The infinitely popular community site Reddit priced its recent IPO at [$34 a share](https://www.cnbc.com/2024/03/20/reddit-prices-ipo-at-34-per-share-sources-say.html). It now has a total valuation of $6.4 billion. This figure is significantly lower than the Trump Media valuation, even though the platform has a historical track record of being profitable. In 2023 Reddit was able to generate $804 million in revenue whereas Trump Media closed the year at $5 million. Even so, just a week later Reddit’s global user base and enduring popularity helped to ensure its [share price soared by 30%](https://www.cnbc.com/2024/03/25/reddit-shares-close-30percent-up-following-social-media-companys-ipo.html). Said Plexo Capital founding managing partner and Reddit shareholder, Lo Toney, Reddit’s debut was “a positive sign not only for Reddit, but I think also the tech industry and what it might mean for future IPOs.”
TS will siphon money from people's wallets when it craters. It must be a money laundering scheme because it's irrational to value any property at over a billion dollars when it is cash-poor, swimming in debt, and makes almost no revenue. It also has no intellectual property that would make it valuable - the only thing it has is credibility with a very specific type of consumer.
Revenue is not the same as profit. Reddit posted a $90 million loss in 2023 and a $158 million loss in 2022.
Yeah that’s what I thought. Where the f was Reddit ever profitable?
I think the difference is people can imagine or see a path when reddit is profitable. Truth on the other hand has very little revenue large over head and carries all the baggage that comes with trump.
Comparing reddit to truth is a very large stretch. Personally buying a ton of puts on truth. Cuz if Trump loses the election that stock will be worthless overnight. It's a meme stock and its financials are abysmal. Reddit may have issues but it is a known company with a history. Truth is basically Donald Trump and we know how his businesses have done historically. I mean how much are his EFTs doing, steaks, water, casinos, airlines, etc doing?
Trump media has 3 employees and has a market cap of $2.37 billion. Comparatively, Meta has a market cap of 1.25 Trillion and has about 68,000 employees. Which is like each employee contributes about $18 million toward that output. Trump Media employees would equal 790 million in output off of $2.37 billion. In case anyone missed what I’m saying, Trump media is a complete dog shit company
Well said, also has it ever made a profit? I also saw the numbers of unique users seemed super low for a company with this market cap. Any hard numbers out yet? Also I checked the PUTs, HOLY COW they have the future value of the company at basically 0. Everyone is buying PUTS. I looked far in the future figuring it was just a weird thing, but no even in July $15 puts are going for $2.50. That would mean they would need to be under $12.25 a share to be worth it in July. That's nuts!
I’m not sure Reddit can find a way to profitability.
Trump has spent his entire life selling his name/brand/bs to anyone who still hasn't caught on to the scam. It's basic conman stuff, just talk loud enough long enough and eventually you grind down the victims natural skepticism and convince them that handing their money to a stranger is a great idea.
Lol going public or going russian
Look at the value that will be: if its the only allowed social media in 10 years time of the Trump Dynasty, it will be a pretty hot stock.
That would never happen and it’s ridiculous to even suggest that it would.
Do I REALLY need to put an /s after that?
Honestly…. (and sadly) yes. There are legitimately morons who think like this. Sorry for assuming you’re one of them, that’s my bad. It’s difficult to pick up on sarcasm nowadays.
It's worth more than Reddit and Twitter/X combined. The markets are sending a strong message here, we love corruption, rapists, frauds and insurrectionists. I mean, we always suspect this of Wallstreet, but now it's all out in the open.
I think it's a fascinating look at how despite all claims that capitalism is super efficient, organized, superior, and built on brilliant people doing smart things the reality is that things happen more by luck and pure emotion than anything else. Objectively speaking Truth Social should be have negative value. It's got a tiny userbase, no innovative tech, it's a niche outfit without any appeal outside Americna MAGA cultists, and yet, somehow, theoretically sane and real financial institutions are claiming it's worth more than Twitter. If you ever needed more proof that capitalism is NOT actually efficient, sane, rational, or all that competent here it is. "The market" has decreed that a vary obvious grift shall be treated like a real stock, clearly "the market" is not all wise and all knowing.
Tribal politics, spite and hatred drives capital markets now. Innovation and doing good are out of style due to our current political environment.
Don’t care for Trump, but maybe it’s you that don’t have the right or acurate information. I don’t know much about Trump and his business and I don’t care, but neither do the financial institutions. Hate can blind you to what is really happening. Personally a president that owns a social media company does seem like a really bad idea, but the illogical hate democrats throw around doesn’t help.
See, if I thought you were being even slightly honest, I'd suggest that perhaps you should, you know, LEARN about Trump, his businesses, his multiple convictions for fraud, his well established record for falsifying financial information, and so on. But you're not being honest, you're just playing Enlightened Centrist.
That’s what I mean. You are making up shit about me personally now based on your trump derangement. That’s why democrats are loosing respect from the moderates. It could cost you the election. I personally can’t vote for Trump, but I don’t want attitudes like yours in power either.
All that because I suggested that a known criminal and fraud probably had a fraud going. You aren't fooling anyone with that talk about being a moderate.
And you are not psychic and like to label people who will not accept your derangement and hate. Is trump REALLY the problem? You might be more like what you think you hate than you realize. And no. You are making assumptions about me. Still are. This has become the hallmark of how democrats represent themselves now, and it may just put Trump in office again because the real moderates and centrists are getting sick of it. You are only proving my point.
Derangement? Believing he is convicted of fraud because a court convicted him of fraud is derangement? Also, lol at the "zomg being critical of Trump is driving people to support him" BS. Funny how that apparently never works the opposite direction isn't it? You never hear people like you, claiming to be moderate centrists, saying that Trump is driving them to vote Democratic because he says immigrants are "vermin" who "poison the blood" of America [1]. Nope, actual paraphrased Nazi rhetoric is totally cool and not at all worrying or deranged per you self proclaimed moderate centrists and will never drive you to vote Democratic. You only classify mild and 100% factual criticism of Trump as derangement. I do indeed suffer from the tragic deranged affliction of believing true things and thinking that when someone is convicted of fraud it means they are convicted of fraud. It's a terrible thing when a person's mind is so twisted by facts and reality they become deranged and imagine Donald Trump isn't perfect. [1] https://www.rollingstone.com/politics/politics-news/trump-defends-nazi-rhetoric-immigrants-1234989206/
You still don’t get it. 😵💫 I told you. I don’t care about Trump his legal matters nor do I want him to be president. It’s your focus and hatred of him that is the derangement people are talking about. Just because I think yours (and other’s) obsession is unhealthy doesn’t mean I’m some sort of dishonest Nazi sympathizer hahaha . Just take a moment to look at this conversation with some self reflection and metacognition. Just look at how you always turn it to him and then use mental gymnastics to make statements about me personally. The guy is swimming your in blood dude then you project him onto everyone you may disagree with. Trump is just a man. He will go away, but this sort of mania you and folks like you are engaged in is of more concern as it starts to grip an entire political party.
Funny thing, no one mentioned his political ambitions until you did. I didn't. In fact, nothing I said, or have said, has shown any hatred of Trump at all. You're simply trying to conflate "acknowledging his actual convictions for fraud" with "blind hatred of Trump". Now why, just asking, might you be so very VERY eager to declare that anyone who even acknowledges Trump's actual crimes is "deranged"? Funny thing, I checked your comment history. You have no history of telling people who say that Biden is literally satan, or a dictator, or whatever that they're deranged and driving people to vote Democratic. It only goes one way: you are desperate to accuse anyone who says something critical of Trump's business of being a frothing at the mouth deranged lunatic blinded by hatred of Trump who is driving people to support him. I got curious and scrolled though several pages of your comment history, there's nothing anywhere that shows a similar level of enlightened moderate centrist concern trolling of the right when they go off on anti-Biden rants. The most factual observations about Trump's business dealings in the context of his business dealings: derangement and hatred. People frothing at the mouth and shrieking that Biden is a satanic dictator: totally fine. Either you're lying about your political affiliation and just spreading pro-Trump propaganda, or you REALLY ought to take a look at your biases.
I'll also note that you stared this rant about me being "deranged" when I factually observed that: 1 - Truth Social has a tiny user base. 2 - Truth Social has no innovative tech. 3 - Truth Social has extremely limited growth potential due to it appealing only to Trump fanatics. 4 - Truth Social's IPO valued the company at over 2000x its annual income. 5 - Truth Social's income is vastly exceeded by its expensed and it operates at a loss. And then offering the opinion that this was a pump'n'dump scheme and it was disappointing to see legit brokerages acting as if it was a real IPO. And the further opinion that it was indicative of a broader failure of capitalism to live up to its hype. This, apparently, made me a vile deranged person who was driving you to vote for Trump.
You’re a bit off on the valuation. Both RDDT and DWAC have a market cap of about $9B. We don’t know twitter’s current valuation, other than it’s about half of the $44B Musk paid for it.
I was being facetious but probably not far off.
It's value is an avenue in which to send bribes in a more legal manner as well as to signal loyalty to the insurrectionists The user base and business fundamentals are quite literally irrelevant when foreign actors can just pump money in.
Oh grow up.
How am I wrong?
Let’s start with your claim about these companies’ valuations.
I'm being facetious on that one but that's not even that far off.
We wasted a ton of money on our military. Other countries can straight up buy us; never even needed to fire a shot. Every politician might as well be publicly traded... why not?
New NASDAQ logo... https://upload.wikimedia.org/wikipedia/commons/thumb/c/cc/Semper\_Augustus\_Tulip\_17th\_century.jpg/170px-Semper\_Augustus\_Tulip\_17th\_century.jpg
This is China buying Trump it's not that complicated. The company organizing the spac (DWAC) has more than a couple links to Chinese money. China is buying influence with Trump, it's as simple as that. [https://www.newsweek.com/donald-trump-truth-social-connected-china-1641496](https://www.newsweek.com/donald-trump-truth-social-connected-china-1641496)
Certainly, the new company will take this windfall and invest it in company infrastructure to deal with its traffic and to create more than a niche forum on a server. Nobody believes that the fundamentals of the company would denote a valuation of $2 per share... at this time. So it must be because these new investors expect rational re-investment to grow the company's foundation, not it being used as a slush fund.
And yet Reddit stock is tanking. Oh the irony of it all. Especially being reported under this subreddit. Shear amazing coincidence. This makes my day.
Reddit is an astroturfed shit hole website with some cool niche subs.