From Delis and Dogecoin, Market Mania Continues to Vex Wall Street

Besides producing exquisite high school wrestlers and being the ancestral homeland of Brew Managing Editor Neal Freyman, the small town of Paulsboro, NJ, doesn’t have that many notable qualities.

But this week, the Philly suburb captured the attention of the business world when it came to light that a deli in town is owned by a public company that’s worth more than $100 million. Here’s the thing—the company, called Hometown International, doesn’t own anything else except the deli. And the deli did $35,748 in sales over the last two years.

So how did we find out about it? In his letter to investors, famous hedge fund manager David Einhorn used the example of Hometown International to put the spotlight on a stock market he considers to be “fractured and possibly in the process of breaking completely.” 

  • Einhorn noted that the CEO and largest shareholder of the company is the principal and wrestling coach of nearby Paulsboro High. 
  • “The pastrami must be amazing,” he quipped.

This is about more than pastrami, as amazing as it might be 

Einhorn’s larger point was that “quasi-anarchy” is breaking out in the stock market, and regulators are MIA. Look no further than dogecoin, a cryptocurrency based on a dog meme that shot up more than 400% just this week.  

  • As of last night, Dogecoin’s market cap was nearly $50 billion, more than Ford’s and eBay’s.

Dogecoin’s ascent has been powered by a rabid online community led by Tesla CEO Elon Musk, who frequently publishes memes about dogecoin on his Twitter account. 

Einhorn is not a fan. Einhorn trashed Musk and celeb investor Chamath Palihapitiya for “destabilizing” the stock market back in January with their tweets and TV appearances in which they egged on retail traders. “The laws don’t apply to him and he can do whatever he wants,” Einhorn wrote of Musk, urging regulators to step in to protect individual investors.

Looking ahead…Einhorn’s letter has revived talk of reining in a “casino”-style market that had died down following the February hearing over GameStop. We’ll see whether Wall Street’s top cop, newly confirmed SEC Chair Gary Gensler, will try to put the doge on a leash. 

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