Stocks of bankrupt companies going bananas despite companies being broke

There’s been a surge of interest in stocks of companies in financial trouble, most notably Hertz (HTZ), which filed for Chapter 11 bankruptcy and was dumped by activist investor Carl Icahn only to be picked up by many users on Robinhood and other stock-trading platforms.

The interest in Hertz has been so hot that the company asked and was granted the right to sell $1 billion in new shares of stock that are essentially worthless. 

“What you’re getting right now is this great disconnect between fundamentals and finance,” said Mohamed El-Erian, chief economic adviser at Allianz, on CNBC. “Take Hertz. A company in a bankruptcy procedure that saw its share price go up….now they’re talking about issuing stocks, warning investors they may be worthless.”

On June 9, Hertz opened at $3.37 and saw highs and lows of $6.25 and $3.09, respectively, which represent massive swings over 80%. The whole

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The month stocks broke from reality: Morning Brief

Friday, May 1, 2020

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April baffled investors from start to finish

April 2020 lived up to its billing — it was indeed the cruelest month.

When April began, the number of confirmed COVID-19 cases in the U.S. totaled 215,177. By month’s end, more than 1.06 million cases had been confirmed.

The death toll in the country has topped 60,000; on April 1, fewer than 5,000 COVID-related deaths had been recorded. Bodies are piling up outside funeral homes in New York. Experts believe COVID-related deaths in the U.S. have been severely undercounted.

Job losses have been staggering. In the past four weeks more than 20 million Americans have filed for unemployment insurance. Next week’s jobs report is expected to show the unemployment rate climbing into the double-digits in April.

GDP data published

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The Fed broke out its crisis playbook: Morning Brief

Monday, March 16, 2020

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Zero rates, quantitative easing, and a signal to lawmakers

The Federal Reserve stunned markets on Sunday night.

In a shock statement posted at 5:00 p.m. ET, the Fed announced its second emergency rate cut in as many weeks and a new quantitative easing program.

The Fed is now clearly on crisis footing. The central bank’s actions on Sunday night send a clear signal to financial institutions around the globe: lend.

In this period of growing economic and public distress, the Fed wants to make clear the broader economic and public health response will not be hamstrung by a lack of liquidity in the banking system.

“While the primary response to this challenge will come from our health care providers and policy experts, economic policymakers must do what we

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How An Automatic Carwash, Broke My Back, Destroyed My Auto And Could Potentially Be Fatal

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