CNN’s Matt Egan And Rachel Soloman roasted former president Donald Trump’s “Filling up” Trump Media (DJT) stock as Vice President Kamala Harris’ rise and Trump’s own actions will affect the price – and an important deadline is approaching.
Trump’s company, Trump Media and Technology (DJT), started trading on the NASDAQ stock exchange in the spring and shot up in its first trading session. But the following Monday, the stock fell sharply after some negative financial reports, then recovered somewhat and has now fallen sharply again.
The stock hit a new low this week as Harris gains in the polls, Trump makes a flashy return to X/Twitter, and the date for Trump to sell his stocks draws ever closer.
In the Thursday edition of CNN News CentralEgan marveled at the stock’s 70 percent drop since the merger, and he and Solomon joked that it might be difficult for Trump to find a lender who would allow him to borrow against the shares rather than sell them:
RAHEL SOLOMON: Well, former President Donald Trump could be in for a huge windfall in the coming days if he manages to monetize his multibillion-dollar social media fortune. But getting that money might not be so easy. The restrictions that prevent him from selling or borrowing on his shares in Truth Social owner Trump Media are about to expire. But they’re not the only thing that could prevent him from selling shares. Let’s hear from CNN’s Matt Egan, who’s going to walk us through some of the obstacles here now, Matt.
MATT EGAN: Yes. Well, there are a lot of obstacles. Look, I’ve been following this Trump media story for years and it’s so fascinating on so many different levels. One of the great ironies of it is that Trump is sitting on this multibillion-dollar fortune from Truth Social that could help him meet some of his cash needs, but he hasn’t been able to touch it.
Right. Because in deals like this one, there are these lock-in restrictions that prevent insiders from selling immediately. These restrictions will be lifted in the next few weeks.
If the stock price stays above $12, it will rise as early as September 20. If not, it will fall by September 25. And at that point, Trump can theoretically do whatever he wants, right?
He could sell it to pay legal fees. He could use it to fund his presidential campaign. He could, I don’t know, buy a sports team, whatever he wants.
Of course, practically, as you know, Rahel. It’s always difficult for large, large shareholders to get rid of their shares quickly. And in this case, it’s even more difficult, isn’t it? I mean, what would that look like?
Trump is not only the largest shareholder. He is also the most popular user of the only product, Truth Social.
RAHEL SOLOMON: He is essentially the face!
MATT EGAN: He’s the face. I mean, the ticker symbol is DJT. Right. That’s why NYU professor Michael Robey told me that it would be virtually impossible for Trump to liquidate all of his stake, or even a third of it, without completely crashing the stock price. That would create a crisis of confidence. And look, the stock price is already crashing. Yesterday it fell another 4%, briefly falling below $20 a share for the first time since that deal was done in the spring.
And since the end of March, the stock has now fallen by 70%! This sell-off has accelerated as Vice President Harris has gained in the polls, while the easing of lockdown restrictions looms, and concerns about whether or not this company is dramatically overvalued also persist.
And his stake in the company was worth $6 billion in May. Now it has shrunk to $2.3 billion. Still a lot of money, but much less than before.
One final point is that while it may be difficult for Trump to sell much of his holdings, there is another way to tap into this wealth. He could borrow money against the value of these shares.
Of course, only if he finds someone – a bank, a wealthy private individual or some other institution – who will lend him money.
RAHEL SOLOMON: Yes, that’s a big if!
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