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The worlds most valuable corporation

No, neither Microsoft nor Google.

Today, it was VW.

How did that happen?

” Frankfurt – A shortage of shares in Volkswagen drove the stock price so high Tuesday that the German carmaker was theoretically the world’s most valuable corporation.

If every voting share in Volkswagen had been worth 1,005 euros (1,257 dollars), the top price of the day on the Frankfurt Stock Exchange, the entire car company would have been worth more than US oil firm ExxonMobil, which is valued at about 334 billion dollars.

[…]

Speculators who had expected the Volkswagen share price to fall were caught unprepared when they sold the stock short.

Short sellers are investors who typically borrow shares and immediately sell them in the stock market at a high price, in the belief that they can purchase identical shares at a lower price at a later date and return them to the lender.

Market sources said 12 to 15 per cent of Volkswagen shares had been subject to short-selling contracts, although less than 6 per cent of the company’s shares were believed to be in free float. “

Next time I hear somebody talk about how the stock market reflects companies’ positions in the market, I’ll laugh in their face. Betting on horses is a more respectable business, if you ask me.

And this is what determines the safety of our jobs.

We’ve come a long way, haven’t we?

Leave a Reply

  1. I am from Lower Saxony, and our “poor” state government holds 20% of the VW shares.
    Incredible, but this state could immediatly be debt-free just by temporarly selling its shares!

    But -you guess it- the politicans are too greedy to act pro-people.
    We need Mavericks to rule this country…

  2. Well personally, I was going to guess Mcdonalds or Cocacola lol. But wow, I never would have guessed Volkswagon, and even with this financial crisis, I'm impressed.

    Jonathan Muller

  3. I do not get this, if it was valued at this amount, those that sold short would then have made millions. Is it legal what has transpired. I drive VW and was inspired by the post but I know that it would never be true.

  4. I do not get this, if it was valued at this amount, those that sold short would then have made millions. Is it legal what has transpired. I drive VW and was inspired by the post but I know that it would never be true.

Webmentions

  • hebig.org/blog November 3, 2008

    Quicklinks Oct 28 |The worlds most valuable corporation- Frank Köhntopp: “Next time I hear somebody talk about how the stock market reflects companies’ positions in the market, I’ll laugh in their face. Betting on horses is a more respectable business, if you ask me. And this is what determines the safety