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Hertz, the original meme stock, is turning out to be worthless

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Re: Hertz, the original meme stock, is turning out to be worthless

#191

Post by brandmeyer »

dragontamer wrote: post #188
HPsquared wrote: post #184

Earlier quoted context omitted.

The people buying the shares are making the "true" valuation of the company, being the ones buying it.

Do you think the buyers of HTZGQ at $5.50 in June 2020 will be proven correct? Or do you think, that like most other bankrupt companies, HTZGQ will be worthless once these bankruptcy proceedings are done? The stock is almost certainly going to go to $0. That's just what happens as bankruptcies play out. If you disagree, you're welcome to toss your money into buying some HTZGQ yourself. ---------- The issue is that He…

It already has gone to zero. The bankruptcy proceedings wrote off all of the old stock and issued an entirely new set of shares, mostly to the debt holders.

(I cannot reply to your response when you edit so often... looks like it resets an anti-spam timer or something)

The proceedings behind a deal at this scale are so private that it is rare to see major salient revisions after a public announcement like this. Nevertheless, I concede the point that it isn't completely final. Presumably they'll be de-listed once that actually happens.

Re: Hertz, the original meme stock, is turning out to be worthless

#192

Post by marshmallow_12 »

brewdad wrote: post #110
foerbert wrote: post #102

Earlier quoted context omitted.

That description also fits straight up robbery. I don't think it's a particularly meaningful statement in this situation.

People were buying a lottery ticket. The difference in this case is that there were no jackpot winners.

To quote Mark Twain (or someone) "The lottery is a tax on people who are bad at math"

Re: Hertz, the original meme stock, is turning out to be worthless

#193

Post by tibbydudeza »

CyberDildonics wrote: post #20

People seem to forget that VW was part of a massive short squeeze that made it the most valuable company in the world for a few days. It took about a month for everything to deflate.

Porsche tried to takeover VAG and it failed and saddled them with so much debt that VAG could swoop in later and take them over instead.

Re: Hertz, the original meme stock, is turning out to be worthless

#194

Post by dragontamer »

brandmeyer wrote: post #191
dragontamer wrote: post #188

Earlier quoted context omitted.

Do you think the buyers of HTZGQ at $5.50 in June 2020 will be proven correct? Or do you think, that like most other bankrupt companies, HTZGQ will be worthless once these bankruptcy proceedings are done? The stock is almost certainly going to go to $0. That's just what happens as bankruptcies play out. If you disagree, you're welcome to toss your money into buying some HTZGQ yourself. ---------- The issue is that He…

It already has gone to zero. The bankruptcy proceedings wrote off all of the old stock and issued an entirely new set of shares, mostly to the debt holders. (I cannot reply to your response when you edit so often... looks like it resets an anti-spam timer or something) The proceedings behind a deal at this scale are so private that it is rare to see major salient revisions after a public announcement like this. Never…

Bankruptcy proceedings are still taking place and are not finalized. HTZGQ will probably go to zero soon, as what you say is almost certainly going to happen.

https://www.prnewswire.com/news-releases/hertz-global-holdin...

As of a few days ago, the PLAN (not yet executed) is to give Knighthead new shares and wipe out the current set of shareholders.

---------

There is a rival plan to keep HTZGQ shareholders alive. These sorts of plans go back and forth, discussed by the board, the bankruptcy court, and so forth to determine the best course of action.

No plan is ever 100% certain... not until the plan is executed. Still: the current plan is that Knighthead will be the new owners, old shareholders will be wiped out, and old bondholders will get 70%.

If bondholders are only able to get 70% under the current plan, it seems unlikely that any alternatively proposed plan would bring that to 100% somehow (the precondition before old shareholders of HTZGQ to get value out of this...). The plans will change, but the amount of assets that Hertz owns will not change. So I'm not entirely sure where another 500-million buckaroos will come from to make the bondholders whole.

Re: Hertz, the original meme stock, is turning out to be worthless

#196

Post by jboog »

karmelapple wrote: post #156
jboog wrote: post #139

Earlier quoted context omitted.

If you read some of the posts on WSB a huge number of people just really have no clue about capital markets, investing, or basic business sense. I don't know how many times I saw people claiming GME would go to $1000 because the new CEO has a brilliant new scheme to turn the company around by going digital! Why "going digital" in 2021 means your company is worth 100X what it was a few months ago I'll never quite unde…

Would you say those same people who just learned the phrase “short” or “short squeeze” are likely the same kind of people going to the casino and thinking they can successfully count cards? As mentioned elsewhere in here, it’s ultimately gambling. It’s putting money up, exposing it to risk that could completely wipe you out. If someone doesn’t understand that about stock investing, I think they’re very similar to som…

Yeah, I agree it's totally gambling.

There's also the thing where buying equity in a company can seem very simple because you see something like Apple where they made a cool thing and obviously their stock went up. People just have no idea about how complex the markets are.

They also don't remember the very smart people who claimed the Iphone would be quickly overtaken by Android and other cheaper alternatives (Clay Christensen predicted this a guy generally very smart on tech/business)

Hindsight always makes it seem like it was easy to pick the great companies that were OBVIOUSLY going to do well.

They don't understand how incredibly sophisticated professional investors are who dedicate their lives to it, and on average even THOSE people don't 'beat the market'.

Re: Hertz, the original meme stock, is turning out to be worthless

#197

Post by lupire »

renewiltord wrote: post #185
brandmeyer wrote: post #107

Earlier quoted context omitted.

No. No! I reject this rationale. Just because its in the domain of finance and business doesn't make it ethical. For example, you can't just disclose your way into arbitrary medical experiments on people. Regardless of how you rationalize the principles, it will end up exploiting the most vulnerable citizens. While I readily admit that the law does not forbid all forms of unethical behavior, I do believe that it shou…

Listen, if you guys want to strict-law yourself so people can't talk to other people, I think that's fine. There should be rules that say people who have strict-lawed themselves should be protected from loose-laws and out-laws. And strict-laws can then interact with strict-laws. In fact, I'm even okay with defaulting to strict-laws and then one takes a test to allow being a loose-law who can interact with other loose…

"accredited investor" law is the "loose-law" you are talking about.

Re: Hertz, the original meme stock, is turning out to be worthless

#198

Post by gonehome »

brandmeyer wrote: post #78

Hol' up. While in bankruptcy, some fools ran up the price of Hertz stock. Then, while the price was up in the middle of bankruptcy proceedings , Hertz sold some new shares to the same fools. The final result of the bankruptcy wiped out all of the shareholders. While the buyers were obviously fools, Hertz should have known that zero shareholder value was a likely outcome. How was selling more stock in that situation l…

There’s a good moneystuff on this, the sale was also stopped by the SEC even though it wasn’t really illegal (mostly just in poor taste).

Hertz’s job in bankruptcy is to try and pay creditors, if a bunch of dummies want to give you money even though you tell them you’re bankrupt and their investment will likely be worth nothing then how is that Hertz’s fault? Arguably Hertz even has a responsibility to sell shares if they're able to raise money to pay creditors.

The dummies are speculatively buying swings, or more likely just seeing the stock advertised as high traffic in Robinhood.

Re: Hertz, the original meme stock, is turning out to be worthless

#199

Post by sigstoat »

Retric wrote: post #161
jjeaff wrote: post #151

Earlier quoted context omitted.

Then it should also ban gambling.

We largely did in the US. There are exceptions, but generally it’s illegal to bet on the winner of a collage football game etc. https://www.espn.com/chalk/story/_/id/19740480/the-united-st... However, that’s slowly been changing over time.

> We largely did in the US.

https://www.cnbc.com/2019/12/12/americans-spend-over-1000-do...

Re: Hertz, the original meme stock, is turning out to be worthless

#200

Post by lupire »

skybrian wrote: post #153
brandmeyer wrote: post #78

Hol' up. While in bankruptcy, some fools ran up the price of Hertz stock. Then, while the price was up in the middle of bankruptcy proceedings , Hertz sold some new shares to the same fools. The final result of the bankruptcy wiped out all of the shareholders. While the buyers were obviously fools, Hertz should have known that zero shareholder value was a likely outcome. How was selling more stock in that situation l…

Under this argument, why should it be legal for anyone to sell Hertz stock? Should trade be halted? Or if other people can sell the stock, why not Hertz?

Shares were available on the old stock (discounted for pieces of bankruptucy liquidations)

Hertz tried to create and sell new shares that would never be worth anything.

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