4 ms·

$44 billion to spite the opposite side?...I doubt it. I know that's like 25% of Musk's current net worth, but that's an outrageous sum to spite people you don't

• nostrademons 4y ago
  TBF a lot of that was overvalued Tesla stock that has since fallen by 70%. It's a common misconception that if you have a net worth of $200B you can buy $200B worth of stuff - it's usually more like "You have 1B shares of a company valued at $200/share". If you went to actually sell those shares, it would tank the price, and you'd end up with far less cash. The way to think about net worth once you get past the upper-middle-class wage-laborer level is "You have assets that the market currently values at $XB, and you want to trade for other assets valued at $XB, and the true value of the assets you currently hold is $YB < $XB [otherwise you'd hold onto them], and you hope that the true value of the assets you're buying is $ZB > $XB." Under this framework, though, it's possible to come out ahead even if $ZB < $XB, as long as $ZB > $YB. It could be he bought Twitter at an inflated price, but he bought it with Tesla shares and leverage that was even more inflated, and so it still works out.
• __derek__ 4y ago
  Probably not spite, but Tesla and SpaceX are exposed to government subsidies and contracts, respectively. If the next elections unlock another trillion in market value for his firms, this bet might look a lot better. Small nit pick: Musk didn't put up $44 billion. His commitment is about half that, with the rest coming from other investors (e.g., a16z, Sequoia, individuals) and debt issued by Twitter, Inc.
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