@Phil
phil spade
@Phil · 3:03

Hertz declares bankruptcy. Issues new "worthless" stock. Investors line up to buy?

I've been following the stock market for close to 30 years now, and the news of Hertz filing and actually gaining approval to sell up to $1 billion in stock in bankruptcy court. It has me speechless. I have never seen anything like this before. And two years ago, Toys R US was a client of mine, and we had to work through that bankruptcy. So I got to learn more about bankruptcy law than I ever really cared to ever know

#irrationalexuberance

4
@shammi
Shammi Mohamed
@shammi · 0:54
Hey, Phil, I haven't looked into this, but right off the bat without knowing much, some of the things that come to my mind are if this is one of those emotional plays where, hey, there's our beloved hurts and we can't let it go out of business. So people are just, I mean, like without looking much into it, just kind of like donating to keep it alive or along those lines. Is this just another ploy to somehow get some bailout money?
2
@sudha
Sudha Varadarajan
@sudha · 1:34
And then once they're done with their restructuring, and if the common stock becomes worthless, then you're left with illiquid worthless stock. So you're right. I have no idea why anybody is buying this. If this is just algorithmic trading, then I PT all of us who put our money in mutual funds, whose algorithms are doing these trades because this is a lot of money to be lost
4
@Phil
phil spade
@Phil · 2:29

#bailoutnation

Some good points in there, especially algorithmic trading that could be going on right now with the existing stock. And that's a very real possibility. And you're right. I forgot to mention that that on there. But to Shammy's point about what kind of ploy this is. I think Sudo, you hit it on the head. They want to make sure that they keep the listing on the New York Stock Exchange. And I think I was reading somewhere where this would help issuing the new stock
2
Swell user mugshot
0:000:00