We have hit a permanently high plateau in amazement at the insanity going on in the market.

Yesterday we reported that Jefferies decided to turn the bankruptcy process on its head, by funding Hertz' bankruptcy not by issuing a super secured DIP loan but by selling up to $1 billion of the most unsecured asset possible, shares of bankrupt HTZ stock to the lunatic Robinhood daytraders that pushed it up even though the said stock is mathematically worthless as confirmed by some $4 billion in Hertz bonds which are currently trading at around 40 cents on the dollar, meaning there is an over $2 billion hole before the equity is remotely in the money.

And while this unprecedented attempt to hold an Initial Bankruptcy Offering should be barred by the SEC, if not the bankruptcy judge, on purely moral grounds as it ensures that the retail investors who get suckered into this daylight robbery - call it a reverse Robinhood deal as it takes money from retail investors and hands it to the creditors who will be the true post-petition owners of the company - Hertz stock is 50% higher as Robinhood traders, unable to grasp the simple math of how pre-petition bankruptcy claims are being filled, are buying the stock on expectations that other Robinhood traders will buy it because, well... the company is selling stock, so my implication there must be demand.

We are closely watching to see if regulators step in and try to halt this "most absurd moment in the history of capital markets" because if they don't and if Jefferies manages to pull off this "legendary" deal, that will be a greenlight moment that launches the most unprecedented white-collar crime in history made possible by the Powell bubble.