3 ms·

He's the richest man in the world on paper. If Tesla has a 3rd consecutive quarter of year-over-year declining sales, then, that will be interesting, especially

He's the richest man in the world on paper. If Tesla has a 3rd consecutive quarter of year-over-year declining sales, then, that will be interesting, especially if, like the previous two quarters where Tesla posted unit sales declines, the EV market continues to grow in units sold. Yes, everybody focuses on how the EV market is not growing as fast as predicted, but it is growing, and meanwhile, Tesla's sales are declining. With regards to relationship capital, yes, that was the banks' intent at the time, believing Musk to be a reasonable businessman. Now that he's demonstrated he's not, that changes the risk evaluation. They're not going to throw good money after bad.

JumpCrisscross 2y ago
> If Tesla has a 3rd consecutive quarter of year-over-year declining sales, then, that will be interesting Tesla could go up in flames and still leave Musk, despite his borrowing against his stock, with more wealth than many countries' GDP. > that was the banks' intent at the time, believing Musk to be a reasonable businessman Musk's reasonableness as a businessman doesn't matter. The tens of billions of dollars of potential business he represents is everything. Based on present reality, not hypotheticals, this remains a good bet. It's why the M&A team is having comp cut but not the lending team [1]. The loans are good business even if the deal was not. [1] https://www.wsj.com/tech/elon-musks-twitter-takeover-is-now-the-worst-buyout-for-banks-since-the-financial-crisis-3f4272cb https://www.wsj.com/tech/elon-musks-twitter-takeover-is-now-...
- taylodl 2y ago
  > Musk's reasonableness as a businessman doesn't matter. The tens of billions of dollars of potential business he represents is everything. Aren't these two statements contradictory? Musk's potential business is merely a fantasy once people realize he's emotional and has a tendency to pop-off at inopportune times and that he can't deliver. Early Tesla and early SpaceX made Musk look like a genius. But his years late delivery of FSD, which isn't even FSD, and the fiasco that is Cybertruck have put Tesla on rocky ground. We've learned that SpaceX has a team in place to manage Musk's worst impulses. Even so, they're under increased scrutiny for violating environmental policies during their launches - but I'd argue they still have an overall positive image. What was Twitter is now a shit show and has revealed the worst of Musk's tendencies. His reputation has taken a huge hit, and since Tesla and X are cult-of-personality companies, they appear to be taking a hit right along with Musk. Would you want to throw more money after that? Maybe - but I'm going to challenge your analysis pretty hard to make sure it makes sense.
  - JumpCrisscross 2y ago
    > Aren't these two statements contradictory? Musk's potential business is merely a fantasy once people realize he's emotional and has a tendency to pop-off at inopportune times and that he can't deliver The measure that matters is Musk's going-forward ability to fundraise. You're noting good risk factors for why that could erode. But he hauled $6bn in May [1]. Everything you mention was known then. As of now, it hasn't hit him where it matters. Again, Tesla could entirely vaporise and Twitter go bankrupt and the very same banks that Musk defaulted on would still have rational reason to continue to do business with him. That would be true even if having access to SpaceX and now xAI ceased to be a wealth-management gold mine. He's simply that wealthy. [1] https://x.ai/blog/series-b https://x.ai/blog/series-b

JumpCrisscross 2y ago

> If Tesla has a 3rd consecutive quarter of year-over-year declining sales, then, that will be interesting Tesla could go up in flames and still leave Musk, despite his borrowing against his stock, with more wealth than many countries' GDP. > that was the banks' intent at the time, believing Musk to be a reasonable businessman Musk's reasonableness as a businessman doesn't matter. The tens of billions of dollars of potential business he represents is everything. Based on present reality, not hypotheticals, this remains a good bet. It's why the M&A team is having comp cut but not the lending team [1]. The loans are good business even if the deal was not. [1] https://www.wsj.com/tech/elon-musks-twitter-takeover-is-now-the-worst-buyout-for-banks-since-the-financial-crisis-3f4272cb https://www.wsj.com/tech/elon-musks-twitter-takeover-is-now-...

taylodl 2y ago
> Musk's reasonableness as a businessman doesn't matter. The tens of billions of dollars of potential business he represents is everything. Aren't these two statements contradictory? Musk's potential business is merely a fantasy once people realize he's emotional and has a tendency to pop-off at inopportune times and that he can't deliver. Early Tesla and early SpaceX made Musk look like a genius. But his years late delivery of FSD, which isn't even FSD, and the fiasco that is Cybertruck have put Tesla on rocky ground. We've learned that SpaceX has a team in place to manage Musk's worst impulses. Even so, they're under increased scrutiny for violating environmental policies during their launches - but I'd argue they still have an overall positive image. What was Twitter is now a shit show and has revealed the worst of Musk's tendencies. His reputation has taken a huge hit, and since Tesla and X are cult-of-personality companies, they appear to be taking a hit right along with Musk. Would you want to throw more money after that? Maybe - but I'm going to challenge your analysis pretty hard to make sure it makes sense.
- JumpCrisscross 2y ago
  > Aren't these two statements contradictory? Musk's potential business is merely a fantasy once people realize he's emotional and has a tendency to pop-off at inopportune times and that he can't deliver The measure that matters is Musk's going-forward ability to fundraise. You're noting good risk factors for why that could erode. But he hauled $6bn in May [1]. Everything you mention was known then. As of now, it hasn't hit him where it matters. Again, Tesla could entirely vaporise and Twitter go bankrupt and the very same banks that Musk defaulted on would still have rational reason to continue to do business with him. That would be true even if having access to SpaceX and now xAI ceased to be a wealth-management gold mine. He's simply that wealthy. [1] https://x.ai/blog/series-b https://x.ai/blog/series-b