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From Fiddy, a tweet worth $50 MILLION

Discussion in 'Sports and News' started by TigerVols, Jan 10, 2011.

  1. TigerVols

    TigerVols Well-Known Member

    50 Cent takes to teh twitters to tout a penny stock...sheer insanity ensues...

  2. slappy4428

    slappy4428 Active Member

    So when he sells and it crashes, does the SEC go after him for stock manipulation?
  3. The Big Ragu

    The Big Ragu Moderator Staff Member

    Anyone who touches it, is a moron. 50 Cent owns 30 million shares. He bought 7.5 million of them at 10 cents. The rest are options priced higher. He made a stupid investment and he is trying to recoup.

    Pumping the stock makes sense for him, and presumably the management (some informercial guy), which has big stakes.

    But the company looks like dog doo. The CEO recently had to make a loan to the company and it had a loss of $1.3 million last quarter.

    So they pump the stock. Bring the market cap up to $80 million plus.

    It's a paper lion. And now if any of them sell; because of 50 Cent's tweets, the SEC is all over them. If 50 Cent's options hit the strike price and he sells, the SEC is going to be saying hello.

    Maybe they were all in already. But now they are stuck holding onto a piece of crud. Anyone who joins them at that price for a company that has been bleeding money, is crazy.
  4. poindexter

    poindexter Well-Known Member



  5. bigpern23

    bigpern23 Well-Known Member

    Question (from an admitted stock market know-nothing): Why would the SEC be all over him if he sells off the stock? What's the difference between him touting a stock and say, Jim Cramer, touting a stock on CNN? Is Cramer not allowed to invest?

    I mean, if you're taking investment advice from a rapper*, aren't you really just getting what you deserve?

    * Rapper/moguls P. Diddy and Jay-Z could be exceptions to this rule. Say what you want, but both have shown serious business acumen.
  6. slappy4428

    slappy4428 Active Member

    His Tweets have helped drive the stock price up. If they climb and he bails, he's manipulated the stock for his profit.
    That the easy version, Ragu? (Who knows far more than I...)
  7. The Big Ragu

    The Big Ragu Moderator Staff Member

    It really depends on what he specifically tweeted. And I don't know. I didn't look. I just took a look at the stock itself this morning and immediately saw a piece of dog shit.

    It's not illegal to tout or recommend a stock -- even if you are paid to do it or you are a company insider. But Federal securities law is a bit tricky, and I do know that if you are paid to pump up a stock, you have to disclose who paid you and what amount. If you are a company insider, you have to disclose your relationship with the company in very uncertain terms. If he lied about anything -- gave news of some impending miracle with a claim that it was going to make the stock price go through the roof, for example, he will be screwed. The SEC files civil fraud charges pretty readily in these kinds of cases, even if the details are murky. So he may be in for a visit. The keys would be them proving somehow "false and misleading statements" and evidence that after he tweeted and the stock price rose, he was out there selling.

    Guess we'll see.
  8. westcoastvol

    westcoastvol Active Member

    Shouldn't the headline read "From Fiddy, a tweet worth fiddy million?"

    Tsk, tsk, TV...
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