Legal and Economic Warfare Against Trump Mirrors Nazi Tactics Against Weimar Republic
By Richard Luthmann
Shares of Trump Media & Technology Group (NASDAQ: DJT) opened at $53.70 last Friday morning; they fell more than 5% by the afternoon, closing at $49.09. Hours after the verdict, shares of TMTG, the parent company of Truth Social, fell as much as 15%. Former U.S. President and Republican nominee Donald Trump owns 65% of the company. The government-sanctioned legal and economic warfare against Trump mirrors Nazi tactics that brought about the demise of the Weimar Republic. It is nothing short of an Extermination Campaign.
The TMTG drop followed news of Donald Trump’s guilty verdict in his criminal hush money trial. It was accelerated by naked short-selling, an illegal practice regulators have ignored regarding the former President’s company. A Manhattan jury convicted Trump of 34 counts of falsifying business records by a New York jury. Many see the result as a dangerous breakdown of the rule of law. The naked short-selling is even more ominous. It portends the demise of American Free Markets.
Regulatory Inaction and Political Bias
The SEC and Nasdaq, controlled by the Biden administration, are accused of allowing this activity, spearheaded by a band of “Never Trumpers.” Devin Nunes, CEO of Trump Media & Technology Group (TMTG), in a letter to Nasdaq CEO Adena Friedman, said he has requested Congress to urge the Financial Industry Regulatory Authority (FINRA) to issue electronic blue sheets for TMTG’s trading data from April 29 through May 3 and some other dates in May and June.
Nunes highlighted the “anomalies” around the trading of TMTG shares, citing data from the SEC. He requested data about financial firms (many having Never Trumpers at the helm), including Citadel Securities (Ken Griffin), G1 Execution Services (Susquehanna International Group LLP / Jeffrey Yass), Virtu AMERICAS / Doug Cifu, and Jane Street Capital (James McClave / Emily Berger).
“These anomalies appear to be growing even more severe,” Nunes wrote. He asked Nasdaq to “fulsomely cooperate with any and all congressional or other investigations into these firms—including by promptly providing responsive data within Nasdaq’s possession.”
Nunes had previously alerted NASDAQ’s Friedman to potential market manipulation in TMTG’s stock, asking the exchange to help prevent alleged manipulation. Naked short-selling, generally illegal in the United States, involves selling shares without first borrowing them or determining they can be borrowed, creating the risk the seller may not be able to deliver the shares. In late May, the company asked the State of Louisiana Office of Financial Institutions Commissioner to investigate alleged “illicit activities” in trading its shares.
Historical Parallels: Lessons from Weimar Germany
Is this an isolated incident of corporate raiders banding together to loot a perceived vulnerable company, particularly one with a flamboyant man on top? Is this just another “trophy” take-down?
No, it’s much worse because of the politics. The regulators’s willful indifference means they are complicit. The parallels between the current situation in America and the fall of the Weimar Republic are striking and alarming. In the early 1930s, German elites and industrialists made a deal with the Nazis to suppress the left and restore order. This “deal with the devil” precipitated the demise of the Weimar Republic and led to the Nazi dictatorship.
“One of the key factors in the Nazi rise to power was the support of powerful conservative elites, including industrialists, landowners, and military leaders. These groups saw the Nazis as a useful tool for suppressing the left and restoring order and stability to Germany. They also hoped to use Hitler and his movement to advance their own economic and political interests.”
What began as a simple campaign to “cleanse” the political landscape of communists, dissidents, and gypsies soon snowballed into unintended authoritarianism.
The same dangerous game is being played by “Never Trumpers,” aligning with Democrat Elites to “Get Trump.” Strike down the Bad Orange Man, and MAGA will scatter. America First will fade. It will be back to “business as usual.”
They fail to realize that when they seek to “protect” democracy using an authoritarian toolset, they do so at the expense of democracy and the free market. It’s a dangerous game, and there’s no chicken switch.
The Importance of Economic Freedom
Economic freedom is crucial for prosperity. It features well-defined and enforced property rights, the ability to trade property rights freely, and the ability to invest property profitably. Property rights are the bedrock of any free market economy. Without ownership rights, individuals cannot engage in market exchanges that move resources from less to more valued uses.
Property rights and the legal systems that enforce them are complementary. Without both, property rights are either moot or trivial. Secure property rights incentivize using property in ways most valuable to society. If property rights are incomplete or insecure, the incentive to use them efficiently decreases.
Owners will not invest in the long run when property rights are not secure, while secure property rights incentivize entrepreneurs to channel resources to their highest-valued uses. Market prices provide information about the relative scarcity of resources. When prices increase, it signals higher value elsewhere, prompting owners to sell.
Friedrich Hayek noted: “The marvel is that…without an order being issued, without more than perhaps a handful of people knowing the cause, tens of thousands of people…are made to use the material or its products more sparingly; i.e., they move in the right direction.”
Market Manipulation and Naked Short Selling
Naked short selling involves selling shares without borrowing or ensuring they exist. Coordinated naked short selling—like we have seen recently with TMTG—smacks of criminal activity.
“In typical short selling, the borrowed shares are eventually returned to the lender. In naked short selling, no shares are actually borrowed or delivered, creating ‘phantom shares.’ This generates artificial sell pressure, with naked shorters profiting from the downtrend. It’s market manipulation 101,” said Wall Street insider John Tabacco.
Naked short selling gained notoriety in the early 2000s. Regulators found it highly detrimental because it allowed traders to drive down prices artificially. The Dodd-Frank Act of 2010 aimed to prevent the practice with strict provisions. Despite this, the practice continues through loopholes. Traders use “zero-plus” agreements, “payment for order flow,” and multiple entities to circumvent regulations.
The SEC’s Division of Enforcement has received many complaints about naked short selling. Investors and companies claim significant losses due to insufficient action against this practice.
Calls for Regulatory Action
In addition to letters to Nasdaq, TMTG’s Nunes wrote to the State of Louisiana Office of Financial Institutions requesting investigations into DJT stock manipulation. He highlighted persistent failures to deliver (FTDs) and potential unlawful collusion among market counterparties. Nunes emphasized the need for regulatory help to protect shareholders and ensure market fairness.
The unprecedented naked short selling of DJT stock and the lack of regulatory action highlight broader economic freedom and property rights issues. Economic freedom diminishes without well-defined and enforced property rights, leading to inefficiencies and reduced prosperity. Secure and complete property rights and free trade are essential for a thriving economy. But in the TMTG case, the regulators aren’t even feigning action.
A Broader Attack on American Democracy
The coordinated legal and economic assault on Trump is not just an attack on one man or one company. It represents a broader attack on America itself, mirroring the tactics used by the Nazis to dismantle the Weimar Republic. The use of regulatory and legal means to target political opponents signals a dangerous slide toward totalitarianism.
The legal and economic warfare against Trump mirrors nazi Tactics.
The current American ruling elite, much like the Nazi supporters, are using their power to suppress dissent and consolidate control. This erosion of democratic norms and the rule of law threatens to plunge the nation into turmoil. The warning signs are clear: America is on the road to fascism, and without immediate action, further decline and war are the inevitable historical result.
The Lessons of History
The “Never Trumpers” making a deal with Democrat Elites to destroy Trump should heed history’s lesson. The German elites who allied with the Nazis to forestall the left’s advance ended up losing everything when the Nazis nationalized much of what they held. A similar fate awaits the “Never Trumpers.” Once the MAGA carcass is devoured, the Democrat-Fascist beast will turn to find its next meal – them. The unchecked appetites of a maddened State are insatiable. Once the American Republic is dead, no one is safe.
Ronald Reagan spoke of an American “rendezvous with destiny.” Until recently, our American Republic was “the last best hope of man on earth.” Is that still true?
Have we failed the “last great experiment for promoting human happiness” our ancestors gave us as our birthright? With the weaponization of justice, the erosion of secure property rights, and the politicization of market regulation, have we taken “the first step into a thousand years of darkness?”
I believe we have. Given recent events, it is hard to reason otherwise. I hope and pray that I am wrong. Nonetheless, I am soon expecting to witness our century’s Reichstag Fire.
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