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He can take out a loan. It's easy, he has all those stocks to leverage against.
by afterburner 8y ago
He can take out a loan. It's easy, he has all those stocks to leverage against.
- adtac 8y agoWhat interest rates do rich people like him get? Is the concept of charging interest still valid at that level or is it all bartering of favours?
- tomatocracy 8y agoI couldn't tell you what interest rate he's likely to pay but in general in this situation, there is interest. Whoever lends him the money has their own cost of funds and admin costs to cover at a minimum, even if they view repayment as close to zero risk because the collateral is very good.
- bdonlan 8y agoYou can get an upper bound by looking at published interest rates for brokerages, e.g.: https://www.interactivebrokers.com/en/index.php?f=1595 https://www.interactivebrokers.com/en/index.php?f=1595
- toomuchtodo 8y agoYou can easily reach 1% or below at that asset level. It’s effectively free. You can also negotiate a payment plan with the government, depending on your financial situation.
- nraynaud 8y agoactually there is already a lot of loans against the company, I don't think you can leverage to infinity.
- Slartie 8y agoAs far as I heard, he is already heavily leveraged against his stock in multiple loans that total into the billions. And his side of that deal just lost quite a bit of substance due to TSLA shares losing value, with a lot more of largely empty space (= high premium assigned to the stock price by investors due to perceived potential) to possibly fall until the bottom comes.
- sjwright 8y agoCitation?
- jhall1468 8y agoThat story tries to sell a darker picture than it really is. 40% of his stock is leveraged, which still only amounts to about $4B (less than that) of his $20B net worth. Larry Ellison has a $11B line of credit leveraged against 30% of his Oracle shares. This is a non-story.