Several sources mentioned this story but none did more than scratch the surface. Did you ever wonder what the banksters did in the wake of GameStopGate? Wonder no more. Bonus cryptocurrency action!
There’s a single New Jersey deli doing $35,000 in sales valued at $100 million in the stock market
By Jesse Pound, 16 April 2021
Hedge fund manager David Einhorn warned of dangers for retail investors that he sees in the market, and one of his main examples was a tiny New Jersey deli with a market capitalization of more than $100 million.
The Paulsboro, New Jersey-based Your Hometown Deli is the sole location for Hometown International, which has an eye-popping market value despite totaling $35,748 in sales in the last two years combined, according to securities filings.
Right off the bat, when a ((billionaire hedge fund manager)) feels threatened by a nothing business in Nowhere, New Jersey, it’s not about money. It’s about identity politics.
A brief bio from Wikipedia. Einhorn graduated Cornell with BA Government in 1991. He started his Greenlight Capital hedge fund in 1996 and over the next decade, managed a 26% rate of return on his investments. That right there is prima facie insider trading. From 2014-2018, his company fell $12b to $5.5b, which is more circumstantial evidence of insider trading: he lost his inside scoops and was forced to rely upon his innate competence instead of all his Jewish -banker relatives.
Even more evidence of that: Einhorn was convicted of insider trading by the UK in 2012. Yes, that WOULD have made his informants a bit more skittish.
“In May 2002, he gave a speech at the Sohn Investment Research Conference where he recommended shorting a mid-cap financial company called Allied Capital eventually disclosing that he himself had a substantial short position. The day after the speech the company’s stock went down by 20 percent.”
“In July 2007, Einhorn shorted Lehman Brothers stock, believing that Lehman had massive exposures to illiquid real estate investments…”
“…On October 17, 2011, Einhorn publicly announced his short position in Green Mountain Coffee Roasters stock. Prior to that date, the company’s share price had increased more than tenfold since March 2009, the third-biggest gain in the Standard & Poor’s Midcap 400 Index… Following Einhorn’s speech Green Mountain’s share price fell by 10 percent, closing that day at $82.50. A few weeks later on November 9, 2011, Green Mountain’s quarterly report missed analyst expectations and its stock price plunged to $43.71.”
He really likes taking huge shorts on companies just in time to make fat bank. Also, he’s a convicted inside trader who was allowed to continue playing the game. That’s the guy who is now complaining that a tiny deli is overvalued?
“Someone pointed us to Hometown International (HWIN), which owns a single deli in rural New Jersey … HWIN reached a market cap of $113 million on February 8. The largest shareholder is also the CEO/CFO/Treasurer and a Director, who also happens to be the wrestling coach of the high school next door to the deli. The pastrami must be amazing,” Einhorn said in a letter to clients published Thursday.
Uh-huh. *SOMEONE*. Just a passerby. Could’ve been anybody. There was no witch hunt.
Hometown, which appears to have begun trading in 2019, according to FactSet, has shares that trade over the counter and rarely has more than a few hundred shares change hands per day. Often, there are no trades logged in an entire trading day.
Still, the company’s market cap is just over $100 million, according to FactSet.
Hometown did not immediately return a request seeking comment made to the phone number listed in the company’s securities filings. A manager was not available to comment at the deli’s phone number.
According to the company’s latest 10-K filing, the company’s single location was closed from March 23 to September 8 of last year because of the coronavirus pandemic. During that time, the company’s stock price rose to $9.25 per share from $3.25 per share. It last traded at just under $14 per share.
The company sold 2.5 million shares last year and has about 60 total shareholders, according a filing.
That’s suspicious in its own right. My first guess would be that the shop is laundering money for the Jersey mafia and I wasn’t far wrong. Before I get to them, however, let’s cover Einhorn’s exact words in regards to Hometown Deli.
Many who would never support defunding the police have supported – and for all intents and purposes have succeeded – in almost completely defanging, if not defunding, the regulators. For the most part, quasi-anarchy appears to rule in markets… For the most part, there is no cop on the beat. It’s as if there are no financial fraud prosecutors; companies and managements that are emboldened enough to engage in malfeasance have little to fear.
Huh? An convicted-felon inside trader is complaining that there aren’t enough cops? Not enough enforcement?
Someone pointed us to Hometown International (HWIN), which owns a single deli in rural New Jersey. The deli had $21,772 in sales in 2019 and only $13,976 in 2020, as it was closed due to COVID from March to September. HWIN reached a market cap of $113 million on February 8. The largest shareholder is also the CEO/CFO/Treasurer and a Director, who also happens to be the wrestling coach of the high school next door to the deli. The pastrami must be amazing. Small investors who get sucked into these situations are likely to be harmed eventually, yet the regulators – who are supposed to be protecting investors – appear to be neither present nor curious. From a traditional perspective, the market is fractured and possibly in the process of breaking completely.
Even stranger. If “small investors” were investing megabucks without noticing that its annual gross sales is south of $22k then they’re too stupid for any number of financial police to defend. Read the prospectus, dumbass, and if you won’t then I have a solar farm you can invest in!
Another recent example is the investigation of Tether by the Office of the Attorney General of New York (OAG). Tether is a cryptocurrency that is always worth a dollar (the value is “tethered” to the dollar). Tether is one of the largest cryptocurrencies with about $40 billion outstanding, yet it has not been audited or regulated in any serious manner. In theory, Tether is supposed to have $1 of cash backing every Tether issued. Except it didn’t, at least when it was investigated. The OAG conducted a two-year probe and found that Tether deceived clients and the market by overstating reserves and hiding approximately $850 million of losses around the globe. Tether and its sponsor, Bitfinex, “recklessly and unlawfully covered up massive financial losses to keep their scheme going and protect their bottom lines,” said the OAG. Further, “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie.”
I don’t do cryptocurrency. I looked into it and can’t get past most of them being fiat currencies with no State backing. Tether is obviously different if it’s 1-for-1 exchangeable with the dollar. But then, why bother with Tether? I looked up Bitfinex and it’s a Hong Kong financial institution registered in the U.S. Virgin Islands, which makes me suspect that Tether’s advantage was moving money internationally and anonymously.
Which helps explain how Bitfinex was repeatedly hacked into insolvency over the last decade. Swimming with the sharks and all that.
Did the OAG shut down Tether? Did anyone get arrested or even lose their job? Was the regulatory infrastructure changed to make sure this doesn’t happen again? No, of course not. The OAG assessed an $18.5 million penalty and Tether agreed to discontinue “any trading activity with New Yorkers.” It was as if Bernie Madoff had been told to pay a small fine and stop ripping off New Yorkers, but to go ahead and have fun with the Palm Beach crowd.
Alternatively, it was as if Einhorn had got caught cheating by the UK and been told to pay a small fine and stop ripping off Englishmen, but to go have fun with his fellow Semitic banker crowd.
Einhorn is upset that somebody in Hong Kong is winning at Einhorn’s game, on Einhorn’s turf.
Hometown reported more than $600,000 in expenses last year, up from about $154,000 in 2019. The company also reported a net cash gain of $2.2 million from financing activities, such as selling stock, in 2020.
Einhorn’s highlighting of Hometown comes as politicians, regulators and high-profile investors have publicly fretted about the boom in certain types of stocks over the past year.
As a new wave of retail investors joined the market in recent months, special purpose acquisition companies have launched at a record pace and some stocks, like GameStop and Discovery, have seen wild swings after being bid up by traders on Reddit or hedge funds.
Yeah, I bet Einhorn is pissed at the amateurs playing his favorite game of shorting stocks. But wait! this Gamestop connection is a headfake!
Paul Morina, the principal of Paulsboro, New Jersey, High School, is listed in financial records as the president, CEO, CFO and more at a Nevada-incorporated company whose stock is trading at levels that give it a valuation more than $100 million.
The high school is next door to the deli so it makes sense for some teachers to pool resources for a side business. This Paul guy is nothing to me.
Hometown’s vice president and secretary is Christine Lindenmuth — a 46-year-old math teacher at Paulsboro High School, according to the SEC filing. Lindenmuth, who did not immediately respond to requests for comment, also does not appear to have any prior experience in food service.
Christine is nothing to me. Heck, I looked into incorporating myself just a few months ago for the tax benefits. I wouldn’t have saved enough money to offset for the mandatory filing fees but if Mark of the Beast happens then I might do it anyway to create a virtual ID.
The company’s chairman, according to the annual report, is Peter Coker Jr., who is listed as holding no Hometown International shares. Coker’s bio in the company’s annual report says the 1990 graduate of Lehigh University has been chairman of South Shore Holdings Limited, a Hong Kong-listed company, since 2013.
Hong Kong, you say? The same place as Bitfinex that Einhorn criticized in his very next paragraph?
Coker is INTERESTING to me.
It also says that Coker was the managing partner of Pacific Advisers, and was also a partner in a Shenzhen, China-based private equity firm called TDR Capital Investment Ltd. from 2009 to 2013.
“From 2006 to 2009, Mr. Coker served as Chairman of Global Trading Offshore Pte (Singapore),” the filing says. “From 2002 to 2005, Mr. Coker served as the Chairman of Wellington Securities (New Zealand). Mr. Coker served as an officer of the Bridge Companies prior to joining Wellington Securities (New Zealand) in 2002.”
Coker’s father, North Carolina resident Peter Coker Sr., is listed on the SEC filing as owning 63,334 shares of common stock in Hometown International, with warrants for 1.26 million more shares.
Other owners of Hometown shares include Blackwell Partners LLC, Series A, which has an address in Hong Kong; and two other Hong Kong entities, Star V Partners LLC, and Maso Capital Investments Limited.
Four other companies or entities listed as Hometown International share owners are based in Macau, China.
Well, well. A tiny storefront in New Jersey is also a shell corporation for Chinese money getting funneled into the American stock exchanges.
You see what happened. After the Gamestop incident, the ((NYC hedge fund managers)) decided to circle the wagons looking for leaks, liabilities and (to them) suspicious behavior. Hometown Deli pinged that search for obvious reasons and now, Einhorn is leading the call to shut the Chinese out of their domestic rackets before the slant-eyes beat them at their own game.