President Biden: The NEW one and only politics thread

It's easily possible to lose money without there being fraud. That isn't me saying there is nothing fraudulent going on at that company, the people behind it are sleazes. It's also not a whole lot of money involved in the actual operation, so they'd be running the dumbest fraud ever.

Lots of companies lose money, especially early stage companies that go out and raise capital (like through an IPO) and then try to invest it to build the business. This has been the story of the cheap money environment of the last few decades, culminating in the price of money becoming so cheap because of fiscal and monetary stupidity that you ended up with speculative excesses in things like Dogecoin or Gamestop stock or AMC theaters or Bed Bath and Beyond as it hurdled toward bankruptcy.

When Amazon incinterated cash year after year, or when Uber was losing money for like 15 straight years, they weren't necessarily frauds.

"Wall Street" isn't what ran up that stock price. It's retail money -- unsophistcated people (or maybe sophisticated, depending on your perspective and if they get lucky) trying to make a quick buck. Financial conditions have loosened dramatically over the last half year, and it started to turn the stock market into a casino again where you were already getting speculative frenzies all over again. Truth Social stepped in at just the right time to attract some of the liquidity they essentially have injected back into markets that is swimming around looking for places to be gambled on.

"Wall Street" itself thinks its a joke. ... Someone posted that Barry Diller video. It doesn't take Barry Diller to conclude that something is very askew when a company that isn't profitbale and only has a few million dollars in revenue (like a mom and pop business) is trading at a valuation in the BILLIONS.

The problem is that the self-regulating market mechanism that SHOULD correct that has been destroyed over the last couple of decades. When the Gamestop saga happened, you had people like Gabe Plotkin short the stock. ... what they were doing was rational. But they got destroyed, because as he found out, the Federal Reserve could print money to monetize runaway government debt a lot longer than he could stay solvent. The lesson to others was don't get in the way of their manipulation anymore. There are a small amount of brave souls who are short Truth Social right now, but finding stock to short has been a HUGE problem. There are something like 150 million shares outstanding. ... and only around 5 million of them available to short sellers, meaning that you are paying an insane interest rate to borrow the stock, putting you in a huge hole from the minute you put on the trade -- even if you can get your hands on the shares. On top of that, the people who have gotten some stock to short are down hundreds of millions of dollars already on just the appreciation of the stock while they wait for the inevtibable. It will end up at SOME point with the inevitable happening, but there aren't a lot of people who have that kind of money to watch twist around in the wind, and the ones who do have it, can make money more easily in a different sandbox.