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Trump fans drive share price of possible "Truth Social" company

2021-10-22T20:35:02.626Z

Donald Trump grew up with real estate. After many social media banned him after the Capitol storm, the ex-US president could take off as a tech entrepreneur. This causes unrest on the stock market.



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"Follow the truth": illustration of the Trumpbook?

Photo: CHRIS DELMAS / AFP

Donald Trump works on his own social network after being kicked out of Twitter.

Before the new platform with the working name "Truth Social" is even established, the former US president can look forward to rising share prices - specifically for the takeover vehicle Digital World Acquisition Corp, a kind of empty shell.

The demand for the share among Trump fans and other investors was again so great on Friday that trading on the Nasdaq technology exchange had to be briefly suspended several times.

Previously, the share price of the Special Purpose Acquisition Company (Spac) had risen by more than 200 percent.

On Thursday, the rate had even risen by 357 percent.

Trump announced the founding of his Trump Media & Technology Group (TMTG) on Wednesday, which will, among other things, launch the online platform "Truth Social".

To go public, TMTG is to merge with Digital World.

Trump claimed that he had collected the money to set up his own publicly traded media company.

The use of such stock exchange vehicles is an increasingly popular way of going to Wall Street in the US.

Office space provider Wework was only launched on the stock exchange on Thursday through the merger with Spac.

Popular on the WallStreetBets forum

Trump was banned from major online platforms such as Facebook, Twitter and YouTube after storming the Capitol on January 6.

How much of his media plans will be implemented is open.

Trump has long been announcing his own platform as an alternative to the "tyranny" of the big technology corporations.

Experts argue over the company's prospects, but the surge in the share price shows that at least some investors are betting that the company will become popular.

Some of them apparently follow Trump's worldview, others may only smell the chance for quick profits.

In several threads of the WallStreetBets forum on Reddit, in which numerous risk-taking small shareholders exchange ideas, at least some users bragged about how much money they would get from getting in and out of Digital World Acquisition Corp.

have earned.

The abbreviation DWAC, under which Digital World is traded on the Nasdaq, was recently one of the most used terms at WallStreetBets.

The massive increase in the price of the Digital World share shows the interest of investors in the plans of the ex-president, who is still very popular with the ultra-conservative base of the USA - and who is toying with a renewed presidential candidacy in 2024.

The DWAC soaring brings back memories of the massive rise in the share price of the computer game retailer GameStop at the beginning of the year.

Small investors, who mainly organized themselves via Reddit, bought massive amounts of paper from the computer game retailer, which had got into trouble due to growing online competition and the corona crisis.

They wanted to cause problems for hedge funds that had bet on falling GameStop prices.

The last time Trump ran a publicly traded company, it didn't end well for investors, by the way.

His casino company, Trump Entertainment Resorts, lost hundreds of millions of dollars over the years and eventually went bankrupt.

Trump himself, on the other hand, earned $ 82 million in fees, salaries and bonuses over the same period, according to Fortune magazine.

apr / AFP / AP

Source: spiegel

All business articles on 2021-10-22

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