Distilled, the value proposition of buying public shares of the parent company of Truth Social is: Donald Trump will make you money. This is not an unusual value proposition for a stock, certainly; they are all predicated on someone making you money. In this case, though, the proposition is unusually centered in the moneymaking skills of one person, more so than perhaps any stock besides Tesla.<\/p>\n
This has been the value proposition of nearly everything Trump has ever done. Even his presidential campaigns are rooted to no small extent in the idea that Trump will make you richer; his 2024 campaign is certainly investing a lot of energy in the idea that he did or will present Americans with a financial windfall.<\/p>\n
The problem, of course, is that the most reliable beneficiary of Trump\u2019s theories of enrichment is Donald Trump. In the case of Truth Social, even he isn\u2019t doing terribly well at the moment.<\/p>\n
It\u2019s interesting to consider what Truth Social is presenting to potential investors without the Trump element. It\u2019s a social network, like X back when it was Twitter. There\u2019s nothing technically exceptional about it; in fact, it\u2019s simply a slightly modified instance of an out-of-the-box social-media-site tool kit called Mastodon.<\/p>\n
The only thing that makes it different from anything else is that Donald Trump owns it and posts on it and has pointed his huge base of support at it as a venue. And that was enough for a lot of people to jump in when the stock went public, including some people who bet their futures on it.<\/p>\n
What\u2019s happened since the stock went public at the end of last month is not normal. Consider three other tech stocks, ones that put a bit more effort into the \u201ctech\u201d part.<\/p>\n
When Google and Twitter went public in 2004 and 2013, respectively, prices quickly jumped upward from their initial offer prices and then held fairly stable. Facebook\u2019s stock, made public in 2012, stayed flat at the outset and then dropped over the next few weeks.<\/p>\n
Now let\u2019s superimpose shares of Trump Media & Technology Group (ticker: DJT). It rose from the offer price, pushing Trump into Bloomberg\u2019s list of the 500 richest billionaires in the world. And then it started steadily shedding value.<\/p>\n
It was like its own little tech-stock bubble went pop. Trump\u2019s share of the stock was worth north of $5 billion at the end of March. On Monday, Forbes put it closer to $2.2 billion.<\/p>\n
If we look at each of the stocks relative to its initial offer price, you can see how much sharper the drop in Trump\u2019s stock was than Facebook\u2019s.<\/p>\n
Trump has been breathlessly insisting to his social media followers \u2014 people who definitionally already use Truth Social \u2014 that the company was intertwined with his broader effort to overhaul the country.<\/p>\n
\u201cIf people who believe in putting America First and want to Make America Great Again, support TRUTH,\u201d he wrote over the weekend, obviously referring to the company and not the concept of honesty.<\/p>\n
This is part of the problem. Trump is overextended. His brand is \u201cfighter for the common man,\u201d but he also needs money. So his brand extends to \u201cbuy this all-American Bible\u201d and \u201cbuy digital pictures of Trump\u201d and \u201cbuy shares in the parent company of this Mastodon instance.\u201d If making America great again somehow requires buying Trump-branded sneakers, it\u2019s possible he has lost the plot.<\/p>\n
Trump allies will point out that the comparison drawn above perhaps implies that better days are ahead. After all, Facebook and Google and \u2026 well, Facebook and Google are doing well. Which is true. Each also had huge user bases when they went public and big teams doing innovative work. Each was predicated on the idea that they could innovate to higher profits.<\/p>\n
Perhaps DJT will prove to be a huge success, rewarding early investors for their foresight. Or maybe it will be Trump Taj Mahal II. Feel free to make your own bet on the question.<\/p>\n<\/p>\n
Distilled, the value proposition of buying public shares of the parent company of Truth Social is: Donald Trump will make you money. This is not an unusual value proposition for a stock, certainly; they are all predicated on someone making you money. In this case, though, the proposition is unusually centered in the moneymaking skills […]<\/p>\n","protected":false},"author":0,"featured_media":3191,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-3190","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/3190","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=3190"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/3190\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/3191"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=3190"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=3190"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=3190"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}