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Tesla (or at least Elon) has a terrible habit of engaging with critics in deeply unproductive ways, such as all the anti short seller stuff they pulled. It make

Tesla (or at least Elon) has a terrible habit of engaging with critics in deeply unproductive ways, such as all the anti short seller stuff they pulled. It makes them look very defensive and seem like they feel vulnerable/cant face the criticism, and maybe it's because they actually are vulnerable and doing things that merit short selling and whistleblowing. At least from a PR perspective you dont want to engage like this if you have nothing to hide, so either they're doing something wrong or they have terrible terrible PR sense. Both seem equally likely right now.

drcross 7y ago
Short sellers have been causing the company a lot of trouble, Musk is correct in pointing them out so that their activities become known.
- vikramkr 7y ago
  No, they really haven't. The best way to deal with shorts is to have a good quarter and crush them all. Or wait for a short squeeze. Lots of companies have misinformation spread by shorts all the time, but very few companies engage and attack shorts.
  - kemiller 7y ago
    Tesla’s stock is shorted FAR more than any other company with comparable market cap. 30% of outstanding shares are shorted. It’s bonkers.
    - kec 7y ago
      But which is the more likely causes of this: That TSLA is the victim of an evil coordinated effort to cause the company to take, or just that 30% of the market genuinely believes they're overvalued. Given they have a higher market cap than either Ford or Honda, I'd be betting on the latter....
      - Retric 7y ago
        ~“Markets can stay irrational longer than you can stay solvent.” Shorting a stock is not just a statement that you think the stock is overvalued. It’s a statement you think the stock will soon drop, because each short costs money and expires. Eventually being correct is useless. If for example it performs poorly over the next 20 years and never actually drops you will lose everything.
        AndrewBissell 7y ago
        Shorting Tesla actually pays a rebate right now, because the stock is cheaper to borrow than the interest paid on the cash proceeds from selling it up front.
        maest 7y ago
        Tesla is one of the most shorted stocks around. There is no way you can get a rebate just by shorting the name. You're probably thinking of the rebate rate, which is the money received by people long Tesla who are lending it out.
        AndrewBissell 7y ago
        Tesla is also one of the most widely held stocks around which means there is an ample float to borrow for shorting. Interactive Brokers pays a rebate.
      - smallgovt 7y ago
        It's not either or. It's safe to assume the vast majority of TSLA shorts believe the stock is overvalued. In addition, some minority of shorts take overt actions to hurt the company's share value.
      - kemiller 7y ago
        When you consider how rich and well-connected the players who stand to lose if Tesla wins, I don’t think it’s at all crazy to suggest that they are using some of that wealth to slow them down. If you happen to have 10 billion hanging around and there are billions more on the line, it’d almost be stupid not to. There’s no law against malicious short selling assuming you’re not outright lying about them in print. Oil companies have a the means, motive, and opportunity. Exxon Mobil alone made $20b in profit last year. 30% of TSLA is 12b or so. If they can delay the electric transition by a couple of years by kicking in a few billions along with the other big ones, that’s a great return on investment even if they take a huge bath on the shorts. Can I prove that’s what’s going on? No, I’m just some dude on the internet. But it really is not implausible at all.
    - wpietri 7y ago
      It's not bonkers at all. Musk's strategy from the beginning has been hype-driven. This gives him low cost of marketing and low cost of capital. But the downside is that the stock will appear overvalued to observers who don't buy the hype. This would be true even if things were going well and Musk were going from strength to strength. But Tesla has had a whole raft of problems, many of them self-inflicted. This is catnip to shorts. Further, part of Musk's strategy has been to bank on the genius-founder stereotype. It has clearly paid off as well; I'd bet that that there's an order-of-magnitude difference between the percentage of people who can name Tesla's CEO and that of any other car company. But again, it's risky; if Musk quit or were forced out, confidence in the company would collapse. And he has made a number of unforced errors; no other car company CEO is in dutch with the SEC. This kind of risk is also hugely appealing to shorts. It's also worth noting that the shorts were right. Tesla's managed to lose half its value from the peak, and it's still down something like 30%. Some of them have surely made a ton of money.
    - true_tuna 7y ago
      It’s not if the stock is overvalued. Time will tell. I’m actually a Tesla shareholder. I bought it when I believed in their vision. Musk’s antics have caused me to rethink the wisdom of my position though. I wouldn’t be surprised by a crash in share price. Then again I’m not betting on it either.
    - philwelch 7y ago
      Because the market cap itself is bonkers. For every short seller there’s three to five fanboy speculators propping the stock price up.
  - lazyjones 7y ago
    I wish a single day would pass with me not having to read advice from random people how to better run Tesla (and probably SpaceX too) than Elon does. It gets old quickly...
    - deleted 7y ago
      [deleted]
  - goshx 7y ago
    I don’t have any problem with someone shorting a stock if they don’t engage in spreading lies and trying to take the company down. If you don’t see what shorts are doing against Tesla, I recommend reading articles about them more often.
    - goshx 7y ago
      https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla-employees-funded-by-tslaq/ https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla...
  - sjwright 7y ago
    I think it's fair to say that Tesla managed to do both. https://www.forbes.com/sites/antoinegara/2019/03/05/after-horrendous-investing-run-david-einhorn-exits-billionaire-club/ https://www.forbes.com/sites/antoinegara/2019/03/05/after-ho...
  - drusepth 7y ago
    Why don't more companies "engage and attack shorts"? Aren't people taking short positions on companies effectively lowering the stock price of the company compared to someone just not buying their stock, and therefore doing potential damage to that company's valuation and future? I'm surprised any company has the time to engage and attack those kinds of threats, but I'm not surprised there is an incentive for them to do so. Is it just the lack of time (or maybe optics, for whatever reason) that other companies don't "fight back"?
    - Lazare 7y ago
      > Why don't more companies "engage and attack shorts"? Because it's incredibly pointless, an utter waste of time, a distraction from things which actually matter, and can veer all-to-quickly into illegal actions as Musk has already found out? (His "taking Tesla private" tweet seemed to have been driven, in part, by a desire to punish shorts. It was later found, of course, to be illegal stock manipulation, and it wiped billions of dollars off Tesla's market cap.) > Aren't people taking short positions on companies effectively lowering the stock price of the company compared to someone just not buying their stock, and therefore doing potential damage to that company's valuation and future? In much the same way that people choosing not to buy Tesla shares do, yes. The effect is real, but even in extreme cases, trivial. It is quite clear that Musk has done vastly more damage to Tesla by worrying about short sellers than the short sellers themselves could have possibly done (eg, with his "taking Tesla private" tweet, but there are many other examples). > I'm not surprised there is an incentive for them to do so There is no incentive to do so. It is actively harmful.
    - refurb 7y ago
      If you want to see the correct way to deal with a short seller, look up what HerbalLife did against Pershing capital’s massive short. They basically continued to grow and show positive financials. Eventually Pershing exited his position. It’s not worth playing a PR game. You’re just asking to get called out on some statement you made. The proof is in the pudding. Sell lots of cars. Don’t claim your going to sell 500,000 vehicles this year, then come back and say “oh, I meant if you annualized our peak month”.
- twblalock 7y ago
  There is nothing wrong with shorting Tesla. Short selling is a necessary corrective to overhyped stocks. If the short sellers are wrong about Tesla being overpriced, they will pay for it. They are taking all of the risk, and they are not hurting anything except Musk's feelings.
  - fouc 7y ago
    Apparently there's a bit more to that. Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much, forcing Tesla to do some sort of liquidity event? So the big short sellers are trying to force the share prices down enough that Tesla is forced to deal with this, which would push the share prices down even more and let them profit hugely.
    - JackFr 7y ago
      > Apparently there's a bit more to that. Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much, forcing Tesla to do some sort of liquidity event? Umm, yeah. There is nothing special about that. In fact that is the point.
    - solveit 7y ago
      That kind of scheme fails spectacularly if people know it's happening. It's really really hard to make money by deliberately mispricing something.
    - __blockcipher__ 7y ago
      > Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much In other words, the shorts are totally right to be taking their position? A company that depends on its stock price to stay afloat is not a healthy company. Let’s take AAPL as an example. Their stock could plunge to $1/share and they would be absolutely fine because they have positive free cash flow, and thus don’t need to rely ok raising capital via selling shares.
      - 7y ago
- sjwright 7y ago
  Interesting that this post is getting voted down. What did it say that offended so many people? > Short sellers have been causing the company a lot of trouble That seems objectively correct. The Tesla stock has been weighed down by an unprecedented amount of shorting—regardless whether or not you agree with the associated predictions. > Musk is correct in pointing them out so that their activities become known. This is an opinion. I suppose you could dispute the opinion that Musk should be doing that. But that's a reasonable opinion, isn't it? I'm confused.
- true_tuna 7y ago
  Deliberately manipulating his stock price to damage short sellers is profoundly unprofessional behavior though. And apparently just a little bit illegal.
ghostly_s 7y ago
If you have any examples of companies who weren't doing something unsavory and had a recurrent problem with whistleblowers I'd love to hear them.
- ryandrake 7y ago
  Well, whistleblowing, by definition, requires the target to be doing unsavory things. Otherwise, it's just "leaking" and many companies have ongoing problems with things like product plans being leaked.
- tylerl 7y ago
  Whistleblowing by definition means reporting something that (someone thinks) is unsavory. You can argue whether a given set of whistleblowers are misguided, but otherwise you don't call them whistleblowers.
- unityByFreedom 7y ago
  No need to rush to judgement, this will be an interesting case to follow, > “It’s taken a long time to get to this point, and I remain steadfast regardless of any monetary outcome. The only thing we are guaranteed to take to our graves is our name. I’ve spent a career of integrity, and won’t stand idly by when someone like Elon Musk runs roughshod over others because he happens to be a billionaire.” edit Please give me the courtesy of explaining downvotes. Thanks.
- gamblor956 7y ago
  Since you made both a condition, 99% of large corporations. If you meant either/or, Patagonia. Clifs. Panera. In n out. There's way more but hopefully you get the point.
r00fus 7y ago
Disagree that short-sellers somehow get to be grouped with whistleblowers. That’s whitewashing them. They are foreign actors with literally a negative stake and deserve to be treated as adversaries.
- __blockcipher__ 7y ago
  > They are foreign actors with literally a negative stake and deserve to be treated as adversaries. No, they’re market participants who are taking an opposing view to the longs, and by doing so are allowing the longs to purchase further ownership of TSLA at a reduced price relative to if there were no short sellers.
- tenpies 7y ago
  > adversaries They are literally paying you, the Tesla long/holder, for the privilege of borrowing your shares or buying options that you are selling. If you own shares and believe in the company, you should be absolutely in love with short sellers because their activities net you money. Nothing a short seller can do will destroying a financially secure, sound company. Nothing. Meanwhile you get to collect interest on borrow rates for your shares, or write options that will expire worthless, netting you tremendous premium. I honestly think that most retail investors do not understand short selling at all. They just think "they want the stock to go down = bad" without considering how costly being a short seller is. Short sellers are constantly on a fuse, but if you're long your time horizon is much more forgiving. Now if you are afraid that the company shares you own could become worthless tomorrow because of cashflow issues, huge debt burden, and a CEO with a notorious history of being unable to tell the truth - that's a completely different issue. It's not really the short sellers who caused any of those issues now is it?
  - datathe1st 7y ago
    Tesla will likely need to raise around $5-10B to complete all of the capital investments they need to perform over the next few years. If short sellers use negative news to bring the stock price down it raises the dilutive cost to Tesla of raising more capital. Secondly there are people who are incredibly intelligent but just too busy living their life to do in depth research about every article they read online, especially if it's from a trusted source. These negative articles have actually prevented people from buying the car because they think the company won't be around to service them in a year or two. Fake news and a barrage of "sponsored" negative headlines can lead to Tesla actually going bankrupt.
smallgovt 7y ago
> At least from a PR perspective you don't want to engage like this if you have nothing to hide. Responding in public fashion is a rational choice for TSLA to make assuming: 1) There exist short sellers who are willing to engage in malicious activities that hurt shareholder value 2) Publicizing their efforts to fight back against said actors acts as a deterrent for further malicious activity. I don't know for sure, but I think there's a reasonable likelihood that both these statements are true.
- Lazare 7y ago
  I find both extremely implausible, both individually and (especially) in combination.
  - kneel 7y ago
    You've never heard of rumor-mongering short sellers? Very much a real phenomenon, hard to catch them and it's very lucrative.
    - baby 7y ago
      Fake news right?
    - derrick_jensen 7y ago
      My favorite example of this is when 4chan spread a fake death rumor of Vitalik Buterin to make money on Ethereum
    - gamblor956 7y ago
      My favorite short seller is the guy who said Tesla was in delivery hell. Then logistics hell. Then short seller hell. Because apparently figuring out the basic business functions of your chosen industry is hell.
- finnthehuman 7y ago
  Dude. You gotta let it go. These are pretty unsurprising allegations for a company like Tesla. And short sellers are not the boogieman, they're just an indication that the value of Tesla is highly uncertain.
wnorris 7y ago
There appears to be an active group working to create these stories in order to create a 'whistleblower hell'. Elon occasionally does not help this, but authorities should look into the allegations that a group is actively manipulating Tesla employees for these types of stories. https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla-employees-funded-by-tslaq/ https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla...
- unityByFreedom 7y ago
  That's not an objective source. Clean Technica is to Elon Musk as Fox News is to Donald Trump
- kreetx 7y ago
  Elon gets a lot of hate unfortunately due to his position in the industry, and also I guess the age we're in. See this tweet from Paul Graham for example https://twitter.com/paulg/status/1122987659079618563 https://twitter.com/paulg/status/1122987659079618563 People notice the hate, and although there most probably are issues in the factories, then the reporting of them is way bent to the negative.
  - unityByFreedom 7y ago
    Elon gets himself into it. He wants to be the center of attention (Thailand, pedo, 420). Creating a profitable business comes second to his need to be seen as a tech luminary.
    - kreetx 7y ago
      I seriously doubt this. Writing a tweet doesn't take much time, and it is probably fun to him to irritate the opposing forces. For profits, I think it's pretty obvious that both Tesla and SpaceX will start making a profit quite soon, and will probably make a lot of it in the long term. (Maybe they are making a profit even now? Sorry, don't know, I'm just a random developer...)
      - 7y ago

drcross 7y ago

Short sellers have been causing the company a lot of trouble, Musk is correct in pointing them out so that their activities become known.

vikramkr 7y ago
No, they really haven't. The best way to deal with shorts is to have a good quarter and crush them all. Or wait for a short squeeze. Lots of companies have misinformation spread by shorts all the time, but very few companies engage and attack shorts.
- kemiller 7y ago
  Tesla’s stock is shorted FAR more than any other company with comparable market cap. 30% of outstanding shares are shorted. It’s bonkers.
  - kec 7y ago
    But which is the more likely causes of this: That TSLA is the victim of an evil coordinated effort to cause the company to take, or just that 30% of the market genuinely believes they're overvalued. Given they have a higher market cap than either Ford or Honda, I'd be betting on the latter....
    - Retric 7y ago
      ~“Markets can stay irrational longer than you can stay solvent.” Shorting a stock is not just a statement that you think the stock is overvalued. It’s a statement you think the stock will soon drop, because each short costs money and expires. Eventually being correct is useless. If for example it performs poorly over the next 20 years and never actually drops you will lose everything.
      - AndrewBissell 7y ago
        Shorting Tesla actually pays a rebate right now, because the stock is cheaper to borrow than the interest paid on the cash proceeds from selling it up front.
        maest 7y ago
        Tesla is one of the most shorted stocks around. There is no way you can get a rebate just by shorting the name. You're probably thinking of the rebate rate, which is the money received by people long Tesla who are lending it out.
        AndrewBissell 7y ago
        Tesla is also one of the most widely held stocks around which means there is an ample float to borrow for shorting. Interactive Brokers pays a rebate.
    - smallgovt 7y ago
      It's not either or. It's safe to assume the vast majority of TSLA shorts believe the stock is overvalued. In addition, some minority of shorts take overt actions to hurt the company's share value.
    - kemiller 7y ago
      When you consider how rich and well-connected the players who stand to lose if Tesla wins, I don’t think it’s at all crazy to suggest that they are using some of that wealth to slow them down. If you happen to have 10 billion hanging around and there are billions more on the line, it’d almost be stupid not to. There’s no law against malicious short selling assuming you’re not outright lying about them in print. Oil companies have a the means, motive, and opportunity. Exxon Mobil alone made $20b in profit last year. 30% of TSLA is 12b or so. If they can delay the electric transition by a couple of years by kicking in a few billions along with the other big ones, that’s a great return on investment even if they take a huge bath on the shorts. Can I prove that’s what’s going on? No, I’m just some dude on the internet. But it really is not implausible at all.
  - wpietri 7y ago
    It's not bonkers at all. Musk's strategy from the beginning has been hype-driven. This gives him low cost of marketing and low cost of capital. But the downside is that the stock will appear overvalued to observers who don't buy the hype. This would be true even if things were going well and Musk were going from strength to strength. But Tesla has had a whole raft of problems, many of them self-inflicted. This is catnip to shorts. Further, part of Musk's strategy has been to bank on the genius-founder stereotype. It has clearly paid off as well; I'd bet that that there's an order-of-magnitude difference between the percentage of people who can name Tesla's CEO and that of any other car company. But again, it's risky; if Musk quit or were forced out, confidence in the company would collapse. And he has made a number of unforced errors; no other car company CEO is in dutch with the SEC. This kind of risk is also hugely appealing to shorts. It's also worth noting that the shorts were right. Tesla's managed to lose half its value from the peak, and it's still down something like 30%. Some of them have surely made a ton of money.
  - true_tuna 7y ago
    It’s not if the stock is overvalued. Time will tell. I’m actually a Tesla shareholder. I bought it when I believed in their vision. Musk’s antics have caused me to rethink the wisdom of my position though. I wouldn’t be surprised by a crash in share price. Then again I’m not betting on it either.
  - philwelch 7y ago
    Because the market cap itself is bonkers. For every short seller there’s three to five fanboy speculators propping the stock price up.
- lazyjones 7y ago
  I wish a single day would pass with me not having to read advice from random people how to better run Tesla (and probably SpaceX too) than Elon does. It gets old quickly...
  - deleted 7y ago
    [deleted]
- goshx 7y ago
  I don’t have any problem with someone shorting a stock if they don’t engage in spreading lies and trying to take the company down. If you don’t see what shorts are doing against Tesla, I recommend reading articles about them more often.
  - goshx 7y ago
    https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla-employees-funded-by-tslaq/ https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla...
- sjwright 7y ago
  I think it's fair to say that Tesla managed to do both. https://www.forbes.com/sites/antoinegara/2019/03/05/after-horrendous-investing-run-david-einhorn-exits-billionaire-club/ https://www.forbes.com/sites/antoinegara/2019/03/05/after-ho...
- drusepth 7y ago
  Why don't more companies "engage and attack shorts"? Aren't people taking short positions on companies effectively lowering the stock price of the company compared to someone just not buying their stock, and therefore doing potential damage to that company's valuation and future? I'm surprised any company has the time to engage and attack those kinds of threats, but I'm not surprised there is an incentive for them to do so. Is it just the lack of time (or maybe optics, for whatever reason) that other companies don't "fight back"?
  - Lazare 7y ago
    > Why don't more companies "engage and attack shorts"? Because it's incredibly pointless, an utter waste of time, a distraction from things which actually matter, and can veer all-to-quickly into illegal actions as Musk has already found out? (His "taking Tesla private" tweet seemed to have been driven, in part, by a desire to punish shorts. It was later found, of course, to be illegal stock manipulation, and it wiped billions of dollars off Tesla's market cap.) > Aren't people taking short positions on companies effectively lowering the stock price of the company compared to someone just not buying their stock, and therefore doing potential damage to that company's valuation and future? In much the same way that people choosing not to buy Tesla shares do, yes. The effect is real, but even in extreme cases, trivial. It is quite clear that Musk has done vastly more damage to Tesla by worrying about short sellers than the short sellers themselves could have possibly done (eg, with his "taking Tesla private" tweet, but there are many other examples). > I'm not surprised there is an incentive for them to do so There is no incentive to do so. It is actively harmful.
  - refurb 7y ago
    If you want to see the correct way to deal with a short seller, look up what HerbalLife did against Pershing capital’s massive short. They basically continued to grow and show positive financials. Eventually Pershing exited his position. It’s not worth playing a PR game. You’re just asking to get called out on some statement you made. The proof is in the pudding. Sell lots of cars. Don’t claim your going to sell 500,000 vehicles this year, then come back and say “oh, I meant if you annualized our peak month”.
twblalock 7y ago
There is nothing wrong with shorting Tesla. Short selling is a necessary corrective to overhyped stocks. If the short sellers are wrong about Tesla being overpriced, they will pay for it. They are taking all of the risk, and they are not hurting anything except Musk's feelings.
- fouc 7y ago
  Apparently there's a bit more to that. Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much, forcing Tesla to do some sort of liquidity event? So the big short sellers are trying to force the share prices down enough that Tesla is forced to deal with this, which would push the share prices down even more and let them profit hugely.
  - JackFr 7y ago
    > Apparently there's a bit more to that. Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much, forcing Tesla to do some sort of liquidity event? Umm, yeah. There is nothing special about that. In fact that is the point.
  - solveit 7y ago
    That kind of scheme fails spectacularly if people know it's happening. It's really really hard to make money by deliberately mispricing something.
  - __blockcipher__ 7y ago
    > Tesla is very leveraged right now and apparently it would be an issue if the share price dropped too much In other words, the shorts are totally right to be taking their position? A company that depends on its stock price to stay afloat is not a healthy company. Let’s take AAPL as an example. Their stock could plunge to $1/share and they would be absolutely fine because they have positive free cash flow, and thus don’t need to rely ok raising capital via selling shares.
    - 7y ago
sjwright 7y ago
Interesting that this post is getting voted down. What did it say that offended so many people? > Short sellers have been causing the company a lot of trouble That seems objectively correct. The Tesla stock has been weighed down by an unprecedented amount of shorting—regardless whether or not you agree with the associated predictions. > Musk is correct in pointing them out so that their activities become known. This is an opinion. I suppose you could dispute the opinion that Musk should be doing that. But that's a reasonable opinion, isn't it? I'm confused.
true_tuna 7y ago
Deliberately manipulating his stock price to damage short sellers is profoundly unprofessional behavior though. And apparently just a little bit illegal.

ghostly_s 7y ago

If you have any examples of companies who weren't doing something unsavory and had a recurrent problem with whistleblowers I'd love to hear them.

ryandrake 7y ago
Well, whistleblowing, by definition, requires the target to be doing unsavory things. Otherwise, it's just "leaking" and many companies have ongoing problems with things like product plans being leaked.
tylerl 7y ago
Whistleblowing by definition means reporting something that (someone thinks) is unsavory. You can argue whether a given set of whistleblowers are misguided, but otherwise you don't call them whistleblowers.
unityByFreedom 7y ago
No need to rush to judgement, this will be an interesting case to follow, > “It’s taken a long time to get to this point, and I remain steadfast regardless of any monetary outcome. The only thing we are guaranteed to take to our graves is our name. I’ve spent a career of integrity, and won’t stand idly by when someone like Elon Musk runs roughshod over others because he happens to be a billionaire.” edit Please give me the courtesy of explaining downvotes. Thanks.
gamblor956 7y ago
Since you made both a condition, 99% of large corporations. If you meant either/or, Patagonia. Clifs. Panera. In n out. There's way more but hopefully you get the point.

r00fus 7y ago

Disagree that short-sellers somehow get to be grouped with whistleblowers. That’s whitewashing them. They are foreign actors with literally a negative stake and deserve to be treated as adversaries.

__blockcipher__ 7y ago
> They are foreign actors with literally a negative stake and deserve to be treated as adversaries. No, they’re market participants who are taking an opposing view to the longs, and by doing so are allowing the longs to purchase further ownership of TSLA at a reduced price relative to if there were no short sellers.
tenpies 7y ago
> adversaries They are literally paying you, the Tesla long/holder, for the privilege of borrowing your shares or buying options that you are selling. If you own shares and believe in the company, you should be absolutely in love with short sellers because their activities net you money. Nothing a short seller can do will destroying a financially secure, sound company. Nothing. Meanwhile you get to collect interest on borrow rates for your shares, or write options that will expire worthless, netting you tremendous premium. I honestly think that most retail investors do not understand short selling at all. They just think "they want the stock to go down = bad" without considering how costly being a short seller is. Short sellers are constantly on a fuse, but if you're long your time horizon is much more forgiving. Now if you are afraid that the company shares you own could become worthless tomorrow because of cashflow issues, huge debt burden, and a CEO with a notorious history of being unable to tell the truth - that's a completely different issue. It's not really the short sellers who caused any of those issues now is it?
- datathe1st 7y ago
  Tesla will likely need to raise around $5-10B to complete all of the capital investments they need to perform over the next few years. If short sellers use negative news to bring the stock price down it raises the dilutive cost to Tesla of raising more capital. Secondly there are people who are incredibly intelligent but just too busy living their life to do in depth research about every article they read online, especially if it's from a trusted source. These negative articles have actually prevented people from buying the car because they think the company won't be around to service them in a year or two. Fake news and a barrage of "sponsored" negative headlines can lead to Tesla actually going bankrupt.

smallgovt 7y ago

> At least from a PR perspective you don't want to engage like this if you have nothing to hide. Responding in public fashion is a rational choice for TSLA to make assuming: 1) There exist short sellers who are willing to engage in malicious activities that hurt shareholder value 2) Publicizing their efforts to fight back against said actors acts as a deterrent for further malicious activity. I don't know for sure, but I think there's a reasonable likelihood that both these statements are true.

Lazare 7y ago
I find both extremely implausible, both individually and (especially) in combination.
- kneel 7y ago
  You've never heard of rumor-mongering short sellers? Very much a real phenomenon, hard to catch them and it's very lucrative.
  - baby 7y ago
    Fake news right?
  - derrick_jensen 7y ago
    My favorite example of this is when 4chan spread a fake death rumor of Vitalik Buterin to make money on Ethereum
  - gamblor956 7y ago
    My favorite short seller is the guy who said Tesla was in delivery hell. Then logistics hell. Then short seller hell. Because apparently figuring out the basic business functions of your chosen industry is hell.
finnthehuman 7y ago
Dude. You gotta let it go. These are pretty unsurprising allegations for a company like Tesla. And short sellers are not the boogieman, they're just an indication that the value of Tesla is highly uncertain.

wnorris 7y ago

There appears to be an active group working to create these stories in order to create a 'whistleblower hell'. Elon occasionally does not help this, but authorities should look into the allegations that a group is actively manipulating Tesla employees for these types of stories. https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla-employees-funded-by-tslaq/ https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla...

unityByFreedom 7y ago
That's not an objective source. Clean Technica is to Elon Musk as Fox News is to Donald Trump
kreetx 7y ago
Elon gets a lot of hate unfortunately due to his position in the industry, and also I guess the age we're in. See this tweet from Paul Graham for example https://twitter.com/paulg/status/1122987659079618563 https://twitter.com/paulg/status/1122987659079618563 People notice the hate, and although there most probably are issues in the factories, then the reporting of them is way bent to the negative.
- unityByFreedom 7y ago
  Elon gets himself into it. He wants to be the center of attention (Thailand, pedo, 420). Creating a profitable business comes second to his need to be seen as a tech luminary.
  - kreetx 7y ago
    I seriously doubt this. Writing a tweet doesn't take much time, and it is probably fun to him to irritate the opposing forces. For profits, I think it's pretty obvious that both Tesla and SpaceX will start making a profit quite soon, and will probably make a lot of it in the long term. (Maybe they are making a profit even now? Sorry, don't know, I'm just a random developer...)
    - 7y ago