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The Twitter Poison Pill Gets The Margin Call Treatment

Portfolio Armor's Photo
by Portfolio Armor
Saturday, Apr 16, 2022 - 13:47

Jeremy Irons in Margin Call (2011).

The Best Explanation of Twitter's Poison Pill Approach Yet

There's a line in J.C. Chandor's excellent 2011 film Margin Call where Jeremy Irons' CEO character tells a subordinate to explain the company's dilemma simply to him: 

Maybe you could tell me what is going on. And please, speak as you might to a young child. Or a golden retriever. It wasn't brains that brought me here; I assure you that.

Twitter user Perpetua Hughes did just that for Twitter's poison pill defense against Elon Musk's takeover bid. Her thread riffs on the scene below, so if you haven't seen the movie, watch this scene first before reading her thread for maximum enjoyment. 

If you're pressed for time, the premise of the movie is a junior analyst at a Lehman Brothers-like firm discovers the mortgage-backed securities on their books are worthless, and the senior partners meet in the middle of the night to discuss what to do with them. 

Now onto Ms. Hughes' excellent thread. Following that, we'll shift gears and close with a quick update on a previous post. 

Shifting Gears

Shifting gears from social media to commodities for a moment, a quick update on a previous post (War In Ukraine Causes Coal To Go Parabolic). 

In that post, I noted our top names from March 3rd, particularly the coal miner Peabody Energy (BTU) had spiked in the wake of the Ukraine War. It wasn't too late to buy Peabody later though. It was also a top ten name of ours on March 17th.

If you bought it then, you were up 48.45% on your BTU position as of Thursday's close. 

If you bought equal dollar amounts of each of our top ten names from March 17th, you were up 10.6%, while SPY was down fractionally over the same time period. As a reminder, we update our top ten names for subscribers each day the market is open on our website.

 

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