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I had given this some thought in the last few months about how valuations across the board are so nonsensical that the investment landscape is ripe for essentially small businesses to go public, and not even have to game their finances because people will mis-screen them anyway and flock to purchase literally anything.
Serious question, could this be money laundering, bribery or something else shady? The fact that the owner made $2.5 Million on a stock sale for a seemingly worthless business seems like it could have some less than legal explanations.
My guess was defrauding Chinese as they were the major investors in it.
More likely the Chinese investors needed a way to evade capital controls in China and this was the vehicle.
How would this work for them? Is it easier if you are a big Chinese investor to buy stock in a small American company than to purchase it in a F500?
It's basically reverse money laundering to turn money that the government knows about into money that the government doesn't.

1. Make a really bad investment in an overvalued small company.

2. Company passes some portion of the money back to you in a way that the government doesn't know about.

3. Company goes bankrupt.

4. The party knocks on your door and asks you where all your money went and you point to a failed foreign investment.

Interesting, thanks.
This would be a poorly executed instance of this strategy right? Who in their right mind is getting fooled by a 100m dollar sandwich shop?
would you have known if this story wasn't posted? Plus every small shop has potential....1 trillion, billion stores all over the world so the value is forward looking ;)
It used to be easier to do this via rolling at the big tables in Macau.
probably featured in a WSB "deep dive" where the author states this stock is the buy of a lifetime
WSB bans posts about companies with less than 1bn market cap, so, while it's possible, it's unlikely
Average trading volume is 346 shares. It’s pretty easy to manipulate the stock price when only a few people are trading.
Which would mean, at current market price of $13.50, $4671 a day is traded.
"""

Hey buddy, I’ll sell ya 100 shares of my company, which has 100M shares outstanding, for $1/piece.

Sound good? Sweet! I’m now a centi-millionaire!!

"""

This is the simplest and probably correct explanation. I'm sure there are others out there too.

Of course volume today is off the hook, lol

Call it art!

"In her first solo art exhibition at New York City’s 303 Gallery, Meyohas traded stocks on the New York Stock Exchange then, in real time, drew the changes in the stock’s valuation with oil stick on blank canvases throughout the gallery."

https://en.wikipedia.org/wiki/Sarah_Meyohas

Long ago, when I was a child, there was an excellent pizza restaurant in the nearby town. Food was great, but it was kind of run-down and not advertised at all; sometimes it would be inexplicably closed for a week, sometimes not.

One very hot summer, when we did not want to be cooking in the kitchen without AC, we had pizza for dinner one night. The next night it was even hotter, so we did the extraordinary thing (for my family) of having takeout two nights in a row.

Well, when dad got to the pizza place to order a pizza, he discovered that it had been converted into a coin-op laundromat, literally overnight.

Moral: mob front businesses are weird; enjoy the surprisingly cheap pizza while it lasts!

> One of the Macau companies, VCH Limited, in May 2020 entered into a consulting agreement with Hometown International, the filing said. “Pursuant to this agreement, VCH was engaged as a consultant to the Company, to, among other things, create and build a presence with high net worth and institutional investors,” Hometown said in its annual report.

This is not exactly just a deli in NJ. Although it looks like one.

https://www.cnbc.com/2021/04/15/hometown-international-nj-de...

The original point was apparently that the company's only business is operating one deli, so the fact that it engaged the services of a company in Macau doesn't really seem to affect that, although it might mean that it's likely to be involved in money laundering and normal investors aren't losing their money.
Maybe this joint is a "laundromat", and not a deli? ;-)
Nothing surprises me anymore... Last year I did a bit of freelance writing on equity markets with a focus on some more interesting stocks. During the period I did read lots of SEC fillings, other articles on various website, etc. It looks like the bigger piece of crap it is, the bigger the valuation. There are tons of companies out there that shouldn't be trading more than a kebab kiosk,yet the stock price is like they are doing missions to mars. Absolute bonkers.
I really think the market is due for a culling. All around me I see people invest in stocks, pennystocks and crypto. I've had to explain to people, who own a few thkusands in crypto, about what a wallet is and how it works. I see people who don't know the difference between debit and credit tell me why Tesla is such a great buy. People who don't know who Adam Smith is. Then there's a few hundred thousand people "investing" (gambling) through /r/wallstreetbets. In my country never have more houses been purchased by investors than ever before. In my personal circle I see people jump through the craziest hoops to get the maximum mortgage possible. Everyone is just leveraged to the tits and I feel like we're in crazy town now. Wonder what happens when the bond yields rise... Or maybe it's just me and I've spent a bit too much time on the internet.
It's not just you, there's at least also me :-)

I too wonder how is it possible what's going on with valuations, my bet is that the bubble will burst between 2021 and 2022.

Right now dogecoin, an abandoned project approaches the market cap of Space X. The deli is really not surprising anymore.
There is no Chinese involvement here!! Dont' t be fooled. It's all one person an American expat who is living/operating out of HK, Macau, Shenzen