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As long as we're covering bad news for Donald Trump, let us move just a few miles north from Juan Merchan's courtroom (100 Centre Street) to NASDAQ headquarters (4 Times Square). As everyone knows, Trump Media &Technology Group (TMTG) is not making money. In fact, it is losing money which, as we understand it, is the literal opposite of making money. The company also has no real plan for reversing that trend. What it does have, however, is expenses that must be paid.

TMTG doesn't have a lot of ways to raise capital, and so it announced yesterday that it will turn to the one option it does have: issuing more stock. The plan is to sell 21.5 million more shares, so as to bring in some cash and keep the doors open. Well, keep the bits flowing, let's say.

This new issuance will water down existing stockholders' holdings, which did not make the markets happy yesterday, as the stock closed at a new low of $26.63/share. It could well go much lower, particularly if there aren't too many buyers willing to throw their money at what looks to be a sinking ship. It could also go the other direction, of course, if speculators and/or MAGA cult members jump at the chance to buy low. Still, the fact that the company is not profitable isn't going away. Forbes Senior Editor Dan Alexander appeared on CNN yesterday, and went so far as to say that the stock could go to zero eventually, forcing TMTG to declare bankruptcy. If so, that would be lucky number seven for the former president.

You may wonder why we give as much attention as we do to this story. It's not schadenfreude (although, admittedly, that doesn't hurt). But it is for two primary reasons. First, the profits Trump expected to realize from this venture might well have solved his money woes. But if there are to be no profits, then he's back to a situation where paying his lawyers and keeping his business empire intact or semi-intact will be a real challenge. At the moment, his TMTG holdings are worth about $2 billion, and of course there's no plausible way to liquidate that much and keep the price steady. So even now, if he was planning to cash out $450 million ASAP to pay his New York judgment, he might not be able to realize that amount.

Second, there could be political fallout here. Trump's whole image is built on the notion that he's a wildly successful businessman. It's one thing that some Atlantic City casinos went belly-up 20 or 30 years ago. It's potentially another thing if such a high-profile venture fails right in the middle of his reelection campaign. And it could make it even worse if a bunch of MAGA fanatics are left holding the bag, because they trusted their Dear Leader with some big portion of their life's savings. (Z)

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