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Or - and this might sound a little tin foil-hat - this was a strategic move to send the price of Bitcoin down, so they can buy the 10% they sold in Q1 back at l

by qayxc 5y ago

Or - and this might sound a little tin foil-hat - this was a strategic move to send the price of Bitcoin down, so they can buy the 10% they sold in Q1 back at lower price. Crypto is an unregulated market with ridiculously high volatility and announcements or big buy-ins are a relatively safe method of controlling the price (to a degree). It's a win-win in the eyes of the management - great PR ("see - they DO care") and dropping crypto prices...

drited 5y ago
While a popular opinion, that does sound more tin foil hat to me than the alternative that he updated his knowledge in the last few months and/or had his opinion on Bitcoin changed by communication from others in the organisation. Tesla is a 568 billion market cap company. The profit it made on Bitcoin doesn't move the needle enough to justify some elaborate scheme to pump and dump. Musk is no stranger to whimsical decisions that, while involving a large amount of money in absolute terms, are not material in the context of the much larger value of his shares in Tesla.
- qayxc 5y ago
  > [...] he updated his knowledge in the last few months and/or had his opinion on Bitcoin changed by communication from others in the organisation. The former idea is ridiculous - so the "Techno King of Tesla" (his choice of title, not mine) took months to learn that proof-of-work crypto produces a lot of CO²? Please... As for the latter, I doubt that to be the case with a person who allegedly acts like this: "If you said something wrong or made one mistake or rubbed him the wrong way, he would decide you’re an idiot and there was nothing that could change his mind." [0] > Tesla is a 568 billion market cap company. The profit it made on Bitcoin doesn't move the needle enough to justify some elaborate scheme to pump and dump. Excuse me? Tesla's Q1 net income was $438M, $101M of which the company attributed to selling crypto [1], that's a whopping 23% of their net profits. I'd say that's "moving the needle" quite a bit indeed. YMMV of course, but I'd like to think that close to a quarter of net income is quite substantial. [0] https://www.thesun.co.uk/news/7977370/elon-musk-fired-hundreds-tesla-employees-behaviour-erratic/ https://www.thesun.co.uk/news/7977370/elon-musk-fired-hundre... [1] https://www.cnbc.com/2021/04/26/tesla-tsla-earnings-q1-2021-.html https://www.cnbc.com/2021/04/26/tesla-tsla-earnings-q1-2021-...
  - croes 5y ago
    And the rest of the profit was from selling carbon credits. And now they are losing a big part of one large buyer. https://fortune.com/2021/05/05/tesla-selling-co2-credits-stellantis-loss-of-business/ https://fortune.com/2021/05/05/tesla-selling-co2-credits-ste...
  - drited 5y ago
    >>'took him months to learn' You say that like he didn't have two giant companies to run. He wasn't studying bitcoin all this time. >>Q1 profits Company valuation depends on decades of earnings. Current earnings matter little to the valuation of high growth companies. >>excuse me You're excused. It's clear that assessing public company valuations is not your area.
    - qayxc 5y ago
      > You're excused. It's clear that assessing public company valuations is not your area. Basic business economics doesn't seem to be your area. Here's a basic example of how you can shoot the "public valuation" of a company into Low Earth Orbit without actually earning a single penny for your operations: Issue 100 million shares at 0.01 cents per share and go public. That's now a $10k dollar public company. Next, you do an increase in capital stock by selling 1 million additional shares at 0.5 dollars per share to gullible investors. In order to achieve that, you hire a bunch of credible consultants who support your fundraiser by lending your company their good reputation and who advertise your business. You can pay them from the $500k you got from selling the new 1M shares and you can now call yourself a multi-millionaire, because the initial 100 million shares are now worth $50M on paper, because that's the latest share price. See how that works and why public valuation based on share value isn't always the most useful tool in assessing a company's finances? > Current earnings matter little to the valuation of high growth companies. See above for how a company can still be cash-starved from cost of operations and investments despite being worth billions on paper. Current earnings do matter, because the current share price doesn't pay wages or keeps the lights on in your Gigafactories. edit: I also find it quite amusing that you think the self-proclaimed "King of Doge" and co-founder of PayPal(!) doesn't know how crypto works, oh please.

by qayxc 5y ago

drited 5y ago

While a popular opinion, that does sound more tin foil hat to me than the alternative that he updated his knowledge in the last few months and/or had his opinion on Bitcoin changed by communication from others in the organisation. Tesla is a 568 billion market cap company. The profit it made on Bitcoin doesn't move the needle enough to justify some elaborate scheme to pump and dump. Musk is no stranger to whimsical decisions that, while involving a large amount of money in absolute terms, are not material in the context of the much larger value of his shares in Tesla.

qayxc 5y ago
> [...] he updated his knowledge in the last few months and/or had his opinion on Bitcoin changed by communication from others in the organisation. The former idea is ridiculous - so the "Techno King of Tesla" (his choice of title, not mine) took months to learn that proof-of-work crypto produces a lot of CO²? Please... As for the latter, I doubt that to be the case with a person who allegedly acts like this: "If you said something wrong or made one mistake or rubbed him the wrong way, he would decide you’re an idiot and there was nothing that could change his mind." [0] > Tesla is a 568 billion market cap company. The profit it made on Bitcoin doesn't move the needle enough to justify some elaborate scheme to pump and dump. Excuse me? Tesla's Q1 net income was $438M, $101M of which the company attributed to selling crypto [1], that's a whopping 23% of their net profits. I'd say that's "moving the needle" quite a bit indeed. YMMV of course, but I'd like to think that close to a quarter of net income is quite substantial. [0] https://www.thesun.co.uk/news/7977370/elon-musk-fired-hundreds-tesla-employees-behaviour-erratic/ https://www.thesun.co.uk/news/7977370/elon-musk-fired-hundre... [1] https://www.cnbc.com/2021/04/26/tesla-tsla-earnings-q1-2021-.html https://www.cnbc.com/2021/04/26/tesla-tsla-earnings-q1-2021-...
- croes 5y ago
  And the rest of the profit was from selling carbon credits. And now they are losing a big part of one large buyer. https://fortune.com/2021/05/05/tesla-selling-co2-credits-stellantis-loss-of-business/ https://fortune.com/2021/05/05/tesla-selling-co2-credits-ste...
- drited 5y ago
  >>'took him months to learn' You say that like he didn't have two giant companies to run. He wasn't studying bitcoin all this time. >>Q1 profits Company valuation depends on decades of earnings. Current earnings matter little to the valuation of high growth companies. >>excuse me You're excused. It's clear that assessing public company valuations is not your area.
  - qayxc 5y ago
    > You're excused. It's clear that assessing public company valuations is not your area. Basic business economics doesn't seem to be your area. Here's a basic example of how you can shoot the "public valuation" of a company into Low Earth Orbit without actually earning a single penny for your operations: Issue 100 million shares at 0.01 cents per share and go public. That's now a $10k dollar public company. Next, you do an increase in capital stock by selling 1 million additional shares at 0.5 dollars per share to gullible investors. In order to achieve that, you hire a bunch of credible consultants who support your fundraiser by lending your company their good reputation and who advertise your business. You can pay them from the $500k you got from selling the new 1M shares and you can now call yourself a multi-millionaire, because the initial 100 million shares are now worth $50M on paper, because that's the latest share price. See how that works and why public valuation based on share value isn't always the most useful tool in assessing a company's finances? > Current earnings matter little to the valuation of high growth companies. See above for how a company can still be cash-starved from cost of operations and investments despite being worth billions on paper. Current earnings do matter, because the current share price doesn't pay wages or keeps the lights on in your Gigafactories. edit: I also find it quite amusing that you think the self-proclaimed "King of Doge" and co-founder of PayPal(!) doesn't know how crypto works, oh please.