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But Tesla stock did drop after the announcement of the deal. I think that is the real reasoning behind him quickly getting cold feet. He probably thought Twit

by slg 4y ago

But Tesla stock did drop after the announcement of the deal. I think that is the real reasoning behind him quickly getting cold feet. He probably thought Twitter would be a fun side project, but the backlash from people in regards to Tesla, SpaceX, and just the general public meant it would be more costly both to his reputation and financially beyond just the sticker price. That took the fun out of it so he has been looking for ways to escape the deal ever since.

jacquesm 4y ago
The question isn't really whether it dropped or not but whether the perception was that it would have dropped more without that fig leaf.
- slg 4y ago
  This isn’t the first time he has sold Tesla shares. He sold billions of dollars worth last year too. I’m not sure the exact dates to do the math, but did those sales cause a immediate drop of over 10% like the Twitter announcement?
  - jacquesm 4y ago
    That's not the right question, the question is the perception of the difference between selling $44B of stock outright or selling it with the goal of buying Twitter. What actually happened isn't relevant. What is relevant is whether he may have thought it would work better. Tricky to prove.
    - slg 4y ago
      We agree that he didn’t suspect the backlash from buying Twitter. I think our disagreement is just that you think he expected a large backlash from selling Tesla shares and I’m not sure history really suggests that was something to be concerned about.
    - robbiep 4y ago
      he wasn't (or isn't) aiming to sell the stock, he was/is aiming to finance the purchase using his Tesla stock as security. So this line of argument... Doesn't really make sense? This is all publicly available. Due to leverage, he faced ruin if Tesla fell below X (whatever X is) if he funded it all himself. So he opened his side of the deal up to other people, and allowed other large shareholders to come inside his tent - which reduced his exposure. Then the market dropped 15%. Matt Levine has an excellent series of newsletters covering it.
mensetmanusman 4y ago
But he has been saying Tesla was way over valued for over a year…
thereare5lights 4y ago
> but the backlash from people in regards to Tesla, SpaceX, and just the general public There's no way he didn't foresee this. It would be shocking if he is lacking in self-awareness to that extent.
- formerkrogemp 4y ago
  > It would be shocking if he is lacking in self-awareness to that extent. 'Ol Musky missing self-awareness? Surely, you jest Mr. Spock!
  - Sebb767 4y ago
    There's a lot of things Elon is not, but he definitely is a smart business man and he can manage hype.
    - elliekelly 4y ago
      His present situation with a multi-billion dollar agreement he entered based on hype and is now very desperate to exit seems to suggest his hype management skills have room for improvement.
    - tsimionescu 4y ago
      He typically creates massive hype, well over what he could possibly deliver, not sure I've ever seen him temper hype. Just remember the launch of Tesla auto-pilot, where he was promising full self driving within a year or two, so good that you would let your car work as a taxi while you don't need it and it would become a passive stream of income so great you would see your investment back in around a year! He actually said "our goal is to make Ilit financially irresponsible to buy any other car". This is not a man who "manages hype".

by slg 4y ago

jacquesm 4y ago

The question isn't really whether it dropped or not but whether the perception was that it would have dropped more without that fig leaf.

slg 4y ago
This isn’t the first time he has sold Tesla shares. He sold billions of dollars worth last year too. I’m not sure the exact dates to do the math, but did those sales cause a immediate drop of over 10% like the Twitter announcement?
- jacquesm 4y ago
  That's not the right question, the question is the perception of the difference between selling $44B of stock outright or selling it with the goal of buying Twitter. What actually happened isn't relevant. What is relevant is whether he may have thought it would work better. Tricky to prove.
  - slg 4y ago
    We agree that he didn’t suspect the backlash from buying Twitter. I think our disagreement is just that you think he expected a large backlash from selling Tesla shares and I’m not sure history really suggests that was something to be concerned about.
  - robbiep 4y ago
    he wasn't (or isn't) aiming to sell the stock, he was/is aiming to finance the purchase using his Tesla stock as security. So this line of argument... Doesn't really make sense? This is all publicly available. Due to leverage, he faced ruin if Tesla fell below X (whatever X is) if he funded it all himself. So he opened his side of the deal up to other people, and allowed other large shareholders to come inside his tent - which reduced his exposure. Then the market dropped 15%. Matt Levine has an excellent series of newsletters covering it.

mensetmanusman 4y ago

But he has been saying Tesla was way over valued for over a year…

thereare5lights 4y ago

> but the backlash from people in regards to Tesla, SpaceX, and just the general public There's no way he didn't foresee this. It would be shocking if he is lacking in self-awareness to that extent.

formerkrogemp 4y ago
> It would be shocking if he is lacking in self-awareness to that extent. 'Ol Musky missing self-awareness? Surely, you jest Mr. Spock!
- Sebb767 4y ago
  There's a lot of things Elon is not, but he definitely is a smart business man and he can manage hype.
  - elliekelly 4y ago
    His present situation with a multi-billion dollar agreement he entered based on hype and is now very desperate to exit seems to suggest his hype management skills have room for improvement.
  - tsimionescu 4y ago
    He typically creates massive hype, well over what he could possibly deliver, not sure I've ever seen him temper hype. Just remember the launch of Tesla auto-pilot, where he was promising full self driving within a year or two, so good that you would let your car work as a taxi while you don't need it and it would become a passive stream of income so great you would see your investment back in around a year! He actually said "our goal is to make Ilit financially irresponsible to buy any other car". This is not a man who "manages hype".