Many of the biggest winners invested in a no-lose deal before word spread that it had to do with Trump. The biggest losers are people like Marjorie Taylor Greene, who bought in at sky-high prices based on their faith in the former president.
onald Trump set off fireworks on Wall Street the night of Oct. 20, when he announced that a new business, the Trump Media and Technology Group, planned to go public via a special purpose acquisition company, or a SPAC. Shares soared 550% in a week.
The sharks, on the other hand, already won the game before anyone else even came to the table. Take the SPAC’s organizer, for example. Or the group that did the underwriting. Or the Wall Street firms that bought in early. The biggest shark, however, seems to be the former president, who will probably make a fortune on the frenzy, even as those who trust in him get crushed.n order to understand all of this, you need to be familiar with how SPACs actually work.
All these backroom agreements happened before any retail investors even had a chance of getting involved. But on September 8, Digital World Acquisition, which had neither operations nor revenue, launched an initial public offering. The investors still weren’t really betting on an actual business. Instead, Orlando was selling the same product he had offered to the institutional firms—a combination of shares and warrants, just without the extra shares for three-tenths of a penny.
But on Thursday morning, after the late-night announcement, the stock opened at $12.73. New investors in Digital World Acquisition could no longer bank on the ability to redeem their shares for $10 without incurring a loss. Now, a new class of investors was getting involved, speculators and people who wanted to invest in the idea of a Trump’s media and entertainment company.