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Trump Media scrambles to stop short sellers from tanking share prices
Trump Media and Technology Group, the parent company of Truth Social, is scrambling to stop short sellers from tanking its share values.
NBC News reports that Trump Media this week sent around suggestions to shareholders to prevent their shares in the company from winding up in the hands of short sellers who are essentially betting on the company's failure to make money.
According to NBC, the "tips include holding DJT shares in a cash account at a brokerage firm as opposed to a margin account, 'opting out of any securities lending program,' moving Trump Media shares to the company’s designated transfer agent, and transferring shares to a bank and 'holding them in your retirement account.'"
Short sellers essentially pay brokerage firms fees to borrow shares on a temporary basis on the belief that the shares will sink in price.
READ MORE: From 'really rich' to begging: Inside Trump's U-turn on one of his first campaign lies
After borrowing the shares, the short sellers proceed to sell them on the open market and then by them back by a specific date when they have to be returned to their owners.
If the share price in that time has indeed gone down, then the short sellers pocket the difference they made between the original sale and the repurchase.
If the share price increases, however, the short sellers lose money because they'll be buying back the shares at a higher price than the original sale.
Short sellers have swarmed to Trump Media shares for weeks now, as its price has plummeted from a high of $66.22 on March 27th to a low of $22.84 on Tuesday, although its price has recovered some of that lost value in the last day-and-a-half of trading.
The longer-term threat to Trump Media's value likely isn't short sellers, however, but simply a lack of profitability. The selloff in shares started earlier this month when the company released an earnings report showing that it lost $58 million in the last fiscal year while generating just $4 million in revenues.
‘Confused’ Trump may have accidentally struck a win for American civil liberties: analyst
An ongoing false claim from former President Donald Trump about the Russia investigation may have had the unintended consequence of dismantling a longstanding surveillance program that was a threat to American civil liberties, analyst Hayes Brown wrote for MSNBC on Thursday.
Specifically, Trump's "Spygate" claims that his campaign was illegally snooped on by federal authorities led him to demand the expiration of the wrong statute, and now the passage of the Foreign Intelligence Surveillance Act (FISA) reauthorization is up in the air as a small group of House Republicans are joining all Democrats to oppose it.
Even a Fox News reporter called him "confused."
"'KILL FISA, IT WAS ILLEGALLY USED AGAINST ME AND MANY OTHERS. THEY SPIED ON MY CAMPAIGN!!!' he wrote on Truth Social, resurrecting one of his long-standing claims about the 2016 election," wrote Brown.
"And the bill being debated didn’t concern all of FISA, just Section 702. But Trump’s post was enough to bolster a revolt among conservative Republicans, 19 of whom voted with Democrats to block the reauthorization bill from coming up for debate.
"For once, though, the GOP’s disarray and obedience to Trump fortuitously may be put to good use. While Trump’s 'Spygate' narrative remains false, it may be harnessed to improve a broken part of America’s intelligence-gathering system."
The problem with Section 702, Brown explained, is a program that allows warrantless surveillance of foreigners living abroad, a once-secret program that was formally authorized in 2008. The law is not intended to apply to Americans, yet American data has been repeatedly caught up in the dragnet.
ALSO READ: No, Donald Trump, fraud is not protected by the First Amendment
Trump's claims that FISA was used to unlawfully spy on his campaign are false, Brown reiterated, and he has flip-flopped on the issue before, previously demanding it expire in 2018 before Republican lawmakers and his cabinet talked him out of it — but this time, things appear to be going differently.
"While Trump’s post rallied conservative opponents to the bill, it’s striking that the rule that was voted down Wednesday managed to get out of committee only because of a proposed bipartisan amendment to the reauthorization bill. The list of co-sponsors is one that you’d never expect to see grouped together, ranging from committed progressives to MAGA die-hards: Reps. Andy Biggs, R-Ariz.; Pramila Jayapal, D-Wash.; Jerry Nadler, D-N.Y.; Warren Davidson, R-Ohio; Zoe Lofgren, D-Calif.; and Jim Jordan, R-Ohio," wrote Brown. "Their proposed change would block 'warrantless searches of U.S. person communications in the FISA 702 database, with exceptions for imminent threats to life or bodily harm, consent searches, or known cybersecurity threat signatures.'"
Ultimately, Brown concluded, "it’s clear that Section 702 isn’t likely to be extended in full without at least some major changes" — and while "Trump’s delusions about the 'deep state' are usually best treated as the ramblings of someone upset that his authoritarian instincts are being trampled ... his ranting might legitimately help safeguard Americans’ rights" in this case.
