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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.
Trump brags about Nobel Peace Prize nomination as he sits in courthouse
Donald Trump arrived at a New York courthouse for the start of his hush money trial Monday, making him the first-ever former president to face a criminal trial in the U.S.
He marked the occasion by taking to his Truth Social platform minutes after his arrival and reminding his followers that he was nominated for the Nobel Peace Prize earlier this year.
The trial comes after Manhattan District Attorney Alvin Bragg accused Trump of falsifying business records to cover up a hush money payment to adult film star Stormy Daniels in an attempt to keep her quiet about a sexual encounter between the two before the 2016 election.
Trump has pleaded not guilty to the 34 charges in the case.
In a post to Truth Social, made as news reports swirled about his arrival at the courthouse, Trump shared images from news stories that broke on Jan. 30 this year, pointing out that a Republican congresswoman had put forward his name to be nominated for the Nobel Peace Prize.
Also read: 'He did say one thing that is accurate': CNN host undercuts Trump courthouse rant
New York Rep. Claudia Tenney said that Trump was "instrumental" in brokering the Abraham Accords, which were signed September 2020 between Israel and Bahrain and the United Arab Emirates and sought to normalize relations between the countries. In the following months, Morocco and Sudan signed a similar treaty.
"For decades, bureaucrats, foreign policy 'professionals', and international organizations insisted that additional Middle East peace agreements were impossible without a resolution to the Israeli-Palestinian conflict. President Trump proved that to be false," Tenney told Fox News at the time.
"The valiant efforts by President Trump in creating the Abraham Accords were unprecedented and continue to go unrecognized by the Nobel Peace Prize Committee, underscoring the need for his nomination today," Tenney added.
