A very liberal friend messaged me on Friday. She’d just heard the news about the $350 million–plus civil fraud judgment against Donald Trump in New York.
That’s on top of the tens of millions he has to pay former magazine columnist E. Jean Carroll, whom he was adjudged to have sexually assaulted and then defamed.
Also: Jury says Donald Trump must pay an additional $83.3 million to E. Jean Carroll in defamation case
My friend figured that — financially, at least — Trump was down for the count.
She’s not alone. Much of media seems to be taking the same view.
They could not be more wrong.
Away from the headlines, Donald Trump has just made a staggering sum of money, all of it driven by the publicity from his campaign for the White House. (A terribly, terribly cynical person might even suggest that is part of the point.)
How much? Forget these fines, which add up to less than $500 million. Trump is suddenly on track for a windfall of nearly $4 billion. And he has made most of it just in the five weeks since his big win in the Iowa caucuses put him in pole position for the Republican presidential nomination.
The windfall is from the forthcoming IPO of his social-media platform, called Truth Social, which he launched — amid massive derision from the mainstream media, I might add — in 2021 after he was kicked off Twitter following the events of Jan. 6, 2021.
Truth Social secured approval for its IPO from the Securities and Exchange Commission this week.
Opinion: The stock linked to Donald Trump’s Truth Social platform is flying high. Read this before you invest.
Also read: DWAC up over 15% as it moves to buy Trump Media & Technology Group — but here’s a potential snag
It will come to the stock market through a merger with a so-called blank-check, or “shell,” company known as Digital World Acquisition Corp.
DWAC,
-4.00%.
(Blank-check companies are paper companies that list on the stock market first and then have a prescribed period of time to find a business to acquire or merge with.)
Under terms of the deal, which has been in the pipeline since 2021, Trump personally is set to end up with 79 million shares in the company when the deal is complete, possibly as soon as this quarter.
Or so reports a new SEC filing by the company, on Page 309.
The value of those shares today: $48. They dropped $2 on Friday, but only after a phenomenal run that has taken them from just $17 in early January, just before the Iowa caucuses.
(Let it be added that Devin Nunes, the Trump acolyte and former Republican congressman from rural California who is the CEO of the Truth Social holding company, will make out more modestly. At current prices, his stock will be worth, er, $5 million.)
That values Trump’s personal stake in the company at $3.8 billion — up $2.5 billion just since winning in Iowa over Ron DeSantis and Nikki Haley, et al. Who says it costs money to run for president?
The stock boom is doubly welcome to Trump. Not only does it mean that the value of his shares go up, but it means he gets even more shares. Under the terms of the deal, Trump and his Truth Social partners get an extra 40 million shares — current value: $1.9 billion — if the stock stays above $17.50.
What the stock is really “worth” is anyone’s guess. It’s a speculative investment, to say the least, even a meme stock. It could easily plunge to Earth. But as long as it stays above $17.50, Trump is in the pink.
There’s no mystery as to why the stock is booming. Some traders are riding the new Trump hype train as he marches toward the Republican Party’s presidential nomination — and, quite possibly, back into the White House.
And many are betting that if Trump becomes president again he will do for Truth Social in his second term what he did for Twitter in his first.
In case you have forgotten, Trump effectively used his Twitter account as a semiofficial presidential communication tool. You couldn’t follow politics without following him on Twitter. Actually, you couldn’t really follow the news. His tweets permeated the culture — as when Andy Serkis, the actor who played Gollum in “Lord of the Rings,” read a number of them in character on late-night TV.
In total Trump tweeted more than 25,000 times during his four years in office — an average of more than 18 times a day.
Twitter’s value trebled during Trump’s four years in office. It was worth $40 billion when he left. (There were many factors involved, but all this free publicity, courtesy of the P.T. Barnum in the White House, hardly hurt.)
Trump’s new windfall from Truth Social comes at a useful time for him. He faces not only huge fines but also mounting legal costs. He currently faces four criminal trials, involving 91 felony counts.
Two are for allegedly attempting to overturn the 2020 election result, in which he lost to Democrat Joe Biden by more than 7 million votes and a 306-232 count in the Electoral College. One is for allegedly mishandling classified documents after leaving the White House. The fourth, for allegedly paying hush money to porn star Stormy Daniels during the 2016 presidential campaign, is scheduled to begin next month.
See: The checks that led to Trump’s first criminal trial in the ‘hush money’ scandal
As I’ve pointed out before, Trump wouldn’t be facing this trial at all if he’d paid off Stormy Daniels with gold coins instead of checks.
Getting access to his new Truth Social billions to help pay his legal fees will be a challenge, though. Presumably, if need be, Trump can borrow against his shares. Lawyers involved in the deal refused to comment. The phone number listed for Digital World Acquisition Corp. in the company’s filings has been disconnected. Emails sent to the media-relations address bounced back.
Trump, recall, was trailing Florida governor DeSantis in the presidential race until the first of his legal indictments landed.
See: Trump’s indictment boosts odds he’ll be the GOP presidential nominee in 2024. You can bet on it.
You see how this whole thing fits together? The establishment indicts Trump. The publicity gives him an unassailable edge in the Republican presidential race. That lands him a $4 billion windfall. And he can funnel some of that money — through fines, and legal fees — back to the establishment. The cost of doing business.
A truly cynical person might wonder if they’re all in on it. And the rest of us are getting played.
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