GM. This is Dumb Money — the only financial newsletter with a 100% loss rate.
The internet did not disappoint this week. Three people made three spectacularly bad decisions involving three different asset classes, and we documented all of them.
$311K in combined losses across a brokerage account, a crypto exchange terminal, and one very optimistic margin position. Here's what we've got today:
🏆 Loss of the Day — $134K in weekly calls on an ad-tech stock. Earnings missed. Calls didn't.: $133,680
📉 Casualty #1 — 50x long on Bitcoin. A treasury company dumped 1,690 BTC. Liquidated in 19 minutes.: $67,500
💊 Casualty #2 — A biotech margin buy before a Phase 3 readout. The trial failed. So did the account.: $108,960
🍪 Bite-Sized Copium for the Road — The best cope from today's comment sections.
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| TODAY'S DAMAGE REPORT 📊 | |||||||||
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Elon Musk just started backing a hot new startup that's already growing faster than Tesla… faster than SpaceX…
And it's even growing 23 times faster than Nvidia.
That's why The Atlantic called it…
"The fastest-growing business in the history of capitalism."
Even though this has nothing to do with robots, self-driving cars and rockets, its CEO is projecting growth of up to 8,000% for this year… Enough to turn $1,000 into $80,000.
Click here and Jeff Brown will show you how to claim your pre-IPO stake for as little as $50.
LOSS OF THE DAY 🏆
Every day we crown one person who made the worst financial decision on the internet.
Today's winner didn't just buy the top. He bought weekly call options at the top. On a stock about to miss earnings. Thirty-six hours before the print.
Here's the setup. A guy on r/wallstreetbets was convinced PulseAd Technologies was the next trillion-dollar company.
The AI ad-tech narrative had been running hot all year. Revenue growth, EBITDA margins, analyst price targets north of $600. Every bull on Twitter had the same thesis.
He didn't just buy shares. He bought 300 weekly $450 call contracts expiring August 8. Total cost: $134,280.
He bought them on August 4. Earnings came out after hours on August 5.
PulseAd missed. Revenue light. EBITDA below consensus. The call transcript included the phrase "lighter than normal model performance improvements."
The stock dropped 17% overnight. His 300 weekly calls opened at $0.02.
Total position value: $600. From $134,280 to $600. In one earnings print.
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Quick note on weekly options before earnings: weekly calls expire in days, not months. If the stock doesn't move your direction immediately, theta decay eats the premium alive. Buying weeklies into an earnings print is pure binary. You're not investing. You're placing a bet at a table where the house edge is the entire options chain.
He posted the screenshot with the caption "AI was supposed to be the future." It is. Just not his future.
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TODAY'S CASUALTIES 💀
Not everybody can be Loss of the Day. But these two gave it a real shot.
Casualty #1: The 50x Bitcoin Bull
Here's what happened. A trader on a crypto exchange opened a 50x long on Bitcoin at $65,200.
His thesis was simple. BTC had been consolidating for a week. Regulators were debating a crypto bill. Momentum was building.
One problem: a large corporate BTC treasury holder had other plans.
On August 10, that company sold 1,690 BTC for $108.6 million to fund preferred stock purchases. The market didn't take it well.
BTC dropped below $64,000 within minutes. His liquidation price was $63,896. He hit it in 19 minutes.
$67,500. Gone. Faster than a food delivery order.
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Here's the thing. When you're 50x levered, a 2% move wipes you out. Bitcoin moves 2% before breakfast. This isn't trading. It's a coin flip with extra steps.
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Casualty #2: The Phase 3 Believer
This one's a slow burn. Our guy found a micro-cap biotech called MiraVax Therapeutics on a Reddit DD thread.
Phase 3 trial results for their lead drug candidate were due August 11. The DD post had a detailed breakdown of the Phase 2 data. It used the word "paradigm" three times.
He bought 8,000 shares of $MRVX at $18.40 on margin. 3x leverage. Total exposure: $147,200 on a $49,067 account.
The trial missed its primary endpoint. The stock opened at $4.78. Down 74% overnight.
His 8,000 shares went from $147,200 to $38,240. With 3x margin, the actual loss was $108,960. He still owes the broker the rest.
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What a Phase 3 trial actually means: it's the final clinical test before FDA approval. About 70% of Phase 3 trials fail. That's not a hidden number. It's on the FDA's own website. Betting your entire margin account on those odds is not due diligence. It's a casino with a lab coat.
He posted: "The Phase 2 data was so strong. I don't understand." Translation: he read the abstract but not the patient dropout rate. Phase 2 had 47 patients. Phase 3 had 1,200. Those are different numbers.
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TODAY BY THE NUMBERS 📊
The best part of any loss thread isn't the screenshot. It's the comments.
Here are today's greatest hits.
| • | "The stock dropped 17% but my conviction went up 200%." Sir, conviction is not a financial instrument. You cannot deposit it. — u/theta_ate_my_face |
| • | "50x leverage is fine if you know what you're doing." He did not know what he was doing. The liquidation receipt confirms this. — u/leveraged_and_lost |
| • | "Phase 2 data was bulletproof." Bulletproof data does not lose 74% of its value overnight. That is, by definition, not bulletproof. — u/fda_roulette |
| • | "I'm not selling. Diamond hands." Your broker already sold. That's what margin calls do. — u/forced_exit_strategy |
Translation: the denial phase of the loss cycle is running at full capacity. Self-awareness remains on back order.
See you tomorrow. New losses, fresh copium, same dosage.
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