Trump Just Painted Himself In A Corner With the SEC. He Is Screwed

This was a monumentally stupid move that Donald Trump made today and one which he may long regret. Somebody really should take his phone away or at least negotiate with him on what he’s going to launch out into cyberspace. The laws of evidence have changed in the internet age and what he just said on Truth Social and Twitter/X could and very well might be used against him in a court of law. Take a look at this and then we will parse through it.

So he considers a week a long period of time.

— Hoover (@Hoover5454) September 13, 2024

The tweet ends, “it will be for a long time to come.” This was NOT a smart move to make. Here’s an article from two days ago after Truth Social stock had been tanking for a while, but the Tuesday debate put it at an all time low. You’ll read the details below. Trump’s brilliant idea was to declare openly that he would NOT be liquidating his shares on September 20. That resulted in a minor bump on the stock market. But it also painted Trump into a corner. Apparently he does these public declarations and admissions without consulting his counsel.

Shares of Trump Media & Technology Group (NASDAQ: DJT) are sinking in Wednesday’s trading. The stock was down 13.2% as of 11:30 a.m. ET today, according to data from S&P Global Market Intelligence. Meanwhile, the S&P 500 index was down 1.2% and the Nasdaq Composite index was down 0.7%.

Trump Media stock is heading lower following last night’s presidential debate between Donald Trump and Kamala Harris. New inflation data and concerns that company insiders will soon be able to sell their shares after a lockup expires are also pressuring the company’s valuation. Today’s sell-offs have pushed Trump Media stock to a new lifetime low.

Donald Trump is the company’s majority shareholder, and the stock has often made moves in conjunction with perceptions surrounding the outlook for the current presidential race. Some investors were likely looking for last night’s debate to provide a bullish catalyst for the stock that could reverse selling pressures ahead of the looming lockup expiration.

The lockup expiration is the SEC’s rule that Trump, as majority shareholder, can’t liquidate shares before a certain date, in this case, September 20, which is next week.

With bullish momentum failing to materialize after the debate and a large number of shares set to become eligible for sale on the open market in the near future, investors are feeling bearish today. And new economic data isn’t helping.

The latest core Consumer Price Index (CPI) data from the U.S. Labor Department showed a 0.3% monthly increase in August, which came in ahead of expectations for a 0.2% increase. While other inflation data looked more promising, the core CPI data is raising concerns.

With the new data, it’s looking more likely that the Federal Reserve will deliver a 25-basis-point cut for interest rates rather than the 50-point cut that some investors have been hoping for. As a result, the broader market is facing bearish pressures today, and some growth stocks and speculative plays are seeing outsize sell-offs.

In simple language, the stock market goes through its ups and downs based on various indicia (such as the prime interest rate, inflation, various other keys) and right now it’s a bearish market. That’s simply the climate we’re in. And, like a pendulum, eventually it will swing back to a bullish market.

With respect to TMTG, owner of Truth Social, Trump and other company insiders could sell a large amount of shares, or all shares they hold (Trump owns 48%), as early as September 20. If they do, that would largely signal the end of Truth Social. On the other hand, NASDAQ writes, “it could get a big boost if the lockup expiration is followed by a relatively small amount of insider selling.” Trump just promised that publicly.

Over the long term, there’s still a lot of uncertainty surrounding Trump Media. The company has launched new services in video streaming and a content delivery network, but the Truth Social media platform remains the core of the business and has been monetizing at low levels.

We’re going to see what happens. Truth Social monetizes at low levels because literally nobody is there but MAGAs and people like yours truly who go over there to spy and laugh. Here’s what TMTG looks like today.

It jumped briefly, but it’s diving again. pic.twitter.com/4td9qetmZk

— Mario 🇺🇸🇵🇱🇺🇦🇪🇺 (@PawlowskiMario) September 13, 2024

People have gone to prison for stock manipulation. This is some dicey territory. But you can’t tell Trump anything. Let’s wait for September 20 and see where things are. If he made this move today, it’s because he’s desperate to recapitalize any way that he can. He doesn’t want Truth Social to go belly up in the 4th Quarter of this year because that’s going to make him look horrible, right before an election. Maybe he staunched the blood letting, maybe he did not. We’ll know more on Monday.

Stupid move — particularly on Friday the 13th, doncha think?

Support the site with a subscription today and see no more ads!

Go Ad-free Now!