You Won’t Believe Truth Social’s Swan Song

I have to say, I’ve been following Truth Social’s every move as it started out as a Mar-a-Lago brainstorming session, then went into DWAC mode, found its SPAC (in ways which raised the scrutiny of the SEC — a special purchase acquisition company is supposed to be set up *before* the company that it *finds* to merge with) and every moment of its debut on the stock market. But this is not a direction that I thought things would go. This will blow your mind, right here.

Trump Media stock sinking faster than a rock in quicksand! 📉 And now, Nunes thinks he's found the Holy Grail with canceled TV shows? That ship has sailed, sunk, and been salvaged for spare parts! It’s heading to a penny stock. 😂⛵️ #DesperateDevin

— My reflections and Introspections (@Nto79549105) April 17, 2024

“Cancelled TV shows.” Let us pause and parse for a moment now, friends, shall we? So is he talking about I Love Lucy and The Honeymooners, which are classic shows — and they’re also available all over the internet not to mention late night local TV? Or perhaps Hercules. Yes, then we can watch Kevin Sorbo at the top of his limited game. That will be something. How about Joanie Loves Chachi, and we can watch Scott Baio? Think of it now, it will perhaps generate a residuals check or two for these fine MAGA talents.

If there is a market in old TV shows, it’s been plumbed to the max. Truth Social getting into the game, at this late stage, is not going to help it reverse its downward slide on the stock market.

And how is that going, you ask? Well, Truth Social and Trump Media & Technology Group have been on Nasdaq about two weeks now. It started out at $79 more or less and it was trading at about $23 when I last looked midday. It could have slid down to the teens by now.

But — and this is a bigggg but, just like Donald’s — there has been an expectation of this and a solution found! Yes! And Devin Nunes’ announcement of the wondrous *streaming platform* that Truth Social is, is part of that solution. What’s that you say? The stock slid another three points AFTER the streaming platform announcement was made? Oh, my. This is not going to be the simple scam that it was set up to be. On the other hand, a lot of money has crossed into Donald and Devin’s pockets, so it’s not a complete disaster.

Here’s the scoop. Then listen to the tape at the end because Stock Market is a foreign language unless you have somebody fluent in it to translate for you. To begin, TMTG  did a new filing today.

…it creates 21 million + new shares for them — but only if the stock stays over $11.50. They’ll be worthless when DJT breaks single digits. The new liquidity, and the urgency to “lock in” profits on that “easy money,” will weigh on the shares toward that price as the August/ September lockup expiry approaches.

The S-1 also registers shares in escrow to be paid if the ARC investors prevail in a lawsuit in which they objected to unfair dilution at the hands of the majority shareholder himself), plus an assortment (4.061,251 to be exact) of other free or cheap founder /insider deals done with warrants.

Then, there’s registration of the “earnout” shares… up to 40 million “free shares” awarded for DJT stock closing for a mere 20 days out of 30 over $17.50. The S-1 registers those shares also.

So What’s the Bill ?

The fully exercised $11.50 warrants create 21,491,251 shares. If fully exercised, they raise $246m for the company, (the company can force redemption if the stock is over $18.00 around the unlock), another provision that might cause warrant holders some gastric distress.

The “earnout” creates 40 million new shares if the share price stays over $17.50. Trump personally gets 90% of the earnout’s free shares. (We surmise the “earnout” was designed to assure Trump’s controlling ownership percentage would not be diminished by the warrants exercise.)

So the “full house” fully diluted scenario would be 204,441,834 shares of DJT free trading with a total $440 million cash in the company, ($2.15 cash per share). This for no actual business to speak of except grift hats, NFT’s, campaign pins, gold sneakers and patriotic bibles, more fundraising pitches, and now a streaming video hate speech platform.

As stated, listen to this tape. But here’s the prediction: the party’s over when TMTG reaches the teens. That should be, at the rate it’s going, either this week or next. Unless this idea that Devin is pitching is a big one. Hey, who knows: Maybe you’ll be standing in the super market line and everybody will be watching Dukes Of Hazzard reruns and that will be the new in thing. Do drop us a line here and let us know.

No billions from Truth Social, Lara better put things in high gear over at the RNC.