'Hard to get your head around': Finance expert hits Truth Social as possible campaign scam
June 26, 2024
Share prices for Donald Trump's social media company are plummeting, and CNBC's finance reporter Andrew Ross Sorkin suggested the presumptive Republican nominee might cash out before the election to fund his campaign.
Trump Media is officially valued at $6 billion, but experts including LinkedIn co-founder Reid Hoffman believe it's worth only a fraction of that. Hoffman has suggested around $40 million.
And Sorkin told MSNBC's "Morning Joe" that very little about the company makes much sense to him financially.
"I think it's still somewhat inexplicable, and I would agree with Reed Hoffman – it's $6 billion when you are creating $4 million in revenue – we're not talking about profit, the company loses a lot of money, it's hard to understand how the numbers add up," Sorkin said.
Truth Social has been a roller coaster ride on the markets lately, with a huge plunge in value since Trump was convicted of 34 criminal charges involving business fraud.
But in the last few days, its value has started to climb again.
"The stock has fallen off – it's off about 50 percent from its all-time highs," Sorkin said.
"After [Trump's] conviction, it dropped 30 percent, then as you mentioned yesterday up about 8.5 percent, this after a 36 percent rally just in the past couple of days. You try to understand what's happened even in the past couple days, and you look online to try to see what the conversation is. There is some sense that maybe if the former president were to win, and that's a little bit of the bet by at least some of the folks who are investing in this company, that if he were to win and use this as his platform, that it would explode and work.
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"Having said that, it's hard to see how that would be the case. Truth Social has been around now for quite some time and has not gained the kind of followers that you would think, even during this election period where people are trying to follow the election unto itself, and you would imagine might even want to follow what the former president has to say on Truth Social. A lot of what is said to the extent he says it on Truth Social ends up on X or other media platforms, anyway. It's hard to get your head around."
He added, "One very important point about this, he owns a big stake in this but has not been able to sell his shares. Those shares he will be able to sell in September, which he may end up using to help facilitate and fund his campaign.
"There's another argument, which we talked about on this broadcast, which is really maybe Trump supporters are effectively using this as a financing vehicle, if you will, for the campaign itself."
Watch the video below or at this link.
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