Securities and Exchange Commission Chairman Gary Gensler declined Tuesday to comment on speculation about whether Trump Media was a financing vehicle for Donald Trump’s presidential campaign.
“I’m not going to talk about a single company,” Gensler said in an interview on CNBC’s “Squawk Box,” responding to a question about whether Trump Media was simply a vehicle to support the former president’s bid for a second term finance.
“What is important is that their disclosures are accurate and that people are not at the top of the market or trading on inside information,” Gensler said.
Since the DJT When the ticker went public on the Nasdaq on March 26, the stock soared, reaching a high of nearly $80 per share and a low of about $12 per share. The stock opened at about $49 on Tuesday.
As the majority shareholder, Trump is expected to receive the biggest financial boost from the DJT recovery.
On Friday, Trump’s stake increased by an additional 36 million shares on top of his existing 78.8 million. This is due to a clause in the company’s contract that unlocks bonus shares if the stock reaches certain control points. Given this increase, Trump’s holding had a paper value of over $5 billion when the market opened on Tuesday.
Trump is still barred from making any money because the contract contains a standard lock-up clause that requires him to wait six months before selling or trading stocks.
But once that deadline passes, it could be a timely windfall for the former president, who is facing a spate of financial problems stemming from multiple lawsuits and presidential campaign expenses.
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Trump’s campaign has shown early signs of budget constraints, raising questions about whether the presumptive Republican nominee would turn his DJT stock into campaign fuel.
The DJT stake comes with a bonus for Trump: There are no limits on how much one can invest in Trump Media, as there are caps on donations to Trump’s presidential campaign, which relies heavily on high-dollar donors.
Trump has not signaled whether he would use his DJT stake for political financing.
Given the stock’s exceptional volatility, some see this as a signal that investors are betting on something other than market metrics.
Gensler also dodged the question of whether DJT’s erratic stock behavior was a potential indication of market manipulation.
Trump Media CEO Devin Nunes has claimed that the stock’s rapid decline is the result of possible “naked” short selling, a trading practice in which the seller bets on the stock’s price falling.
“Everyone is allowed to form their own opinion. That’s one of the beauties of our capital markets,” Gensler said. “It’s about tens of thousands and millions of people being able to do their own research.”
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2024-05-07 19:35:38
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