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Because this move is entirely financial engineering to hide losses just like the roll up of X in to xAI. None of this has anything to do with business or innov

Because this move is entirely financial engineering to hide losses just like the roll up of X in to xAI. None of this has anything to do with business or innovation. Do you not immediately see that? Most of my friends reaction to this news was that this is so obvious it's almost funny (or actually it is funny, since most were laughing as they read the headline). I'm curious how you could not understand the relevance of the quote unless you were aggressively trying to not understanding it.

livefeather 9mo ago
> I'm curious how you could not understand the relevance of the quote unless you were aggressively trying to not understanding it. Monet probably wondered how other people couldn't see purple in a haystack.
- reverius42 9mo ago
  [flagged]
senectus1 9mo ago
yeah, I am not a huge fan of Musk, but this move is just going to bring down arguably the only decent thing he's produced. Leave SpaceX alone you child. Gwynne has it in excellent hands.. find some other way to pay for your juvenile brainfarts.
- tialaramex 9mo ago
  Although I'm sure SpaceX would be a non-trivial loss, the most important idea - their truly reusable rocket -- is proven to the point where other people are assuming they should do that to make rockets, it's like if Benz' company goes bankrupt in 1899. In that universe the Mercedes probably never happens but the automobile idea is already a done deal.
  - fluoridation 9mo ago
    What do you mean? SpaceX didn't invent the reusable rocket, and my understanding is that Falcon 9 is still not significantly more economical than disposable rockets, and that the main reason it's attractive is that it's not Soyuz-2.
    - andsoitis 9mo ago
      > SpaceX didn't invent the reusable rocket There isn’t a single inventor and reusable rockets emerged through decades of research. But: SpaceX was the first to make orbital-class reuse routine and economically viable.
    - rogerrogerr 9mo ago
      Your understanding is wrong; see page 2 of https://ntrs.nasa.gov/api/citations/20200001093/downloads/20200001093.pdf https://ntrs.nasa.gov/api/citations/20200001093/downloads/20.... That’s a log plot! The backing table is on page 8. Falcon 9 is (was, in 2018! It’s only cheaper now.) at $2700/kg to LEO. No one else is below $4k, except… Falcon Heavy.
    - jasonwatkinspdx 9mo ago
      Space is basically half the cost of it's competitors on a per kg basis. And while previous experiments like the DC-X existed, SpaceX absolutely gets credit for the first operational reusable rocket stage. And I say that as someone that despises Elon and the way he casts his companies as due to his personal technical genius.
      - fluoridation 9mo ago
        >And while previous experiments like the DC-X existed, SpaceX absolutely gets credit for the first operational reusable rocket stage. Not true. What about STS?
        jasonwatkinspdx 9mo ago
        Eh that's a spaceplane and solid rocket booster shells which I see as categorically different, and an absurd failure on a cost per kg basis.
- leesec 9mo ago
  >arguably the only decent thing he's produced. such a hilarious comment / mindset. he made the best selling car in the world 3 years running. neuralink is a great breakthrough. there are a string of accomplishments which individually would be the greatest thing many many people have ever done.
  - scubbo 9mo ago
    > he made the best selling car in the world 3 years running Not only did Elon not found Tesla[0], but many employees have described the "babysitters" or "handlers" who are responsible for making him feel like his ideas have been implemented, so that his caprice and bluster don't interfere with the actual operation of the company. To give him his due, he's a phenomenal manipulator of public opinion and image, and he certainly has invested a lot of his emerald-generated wealth into numerous successful ventures - but he himself is not a positive contributor to their success. [0] https://autoworldjournal.com/is-elon-musk-the-founder-of-tesla/ https://autoworldjournal.com/is-elon-musk-the-founder-of-tes...
    - Fogest 9mo ago
      I mean, even if he isn't directly making a lot of the decisions in these companies that are doing well, it doesn't mean he doesn't play a big role in that still. He still had to pick a lot of these leaders, pay them well, keep them satisfied enough to stay there, and also give them the proper freedom to lead these companies. There are many people out there who could also manage to make these companies fail instead of grow. I feel that a lot of people simply don't like Elon because of political reasons which are often also based on misinformed opinions. It also can't be denied that he is an intelligent person. You can hear it when he talks in interviews. Now I think ultimately any ultra wealthy person is going to have some flaws that people can find and latch onto in order to hate someone.
      - scubbo 9mo ago
        > It also can't be denied that he is an intelligent person. You can hear it when he talks in interviews. While I certainly won't deny that I do strongly disagree with all of Elon's politics, I'm being as fair and unbiased as I can when I say - we must be listening to different interviews. The man sounds like a caricature of a bumbling college stoner philosophy student most of the time.
- saalweachter 9mo ago
  I think we're around stage 4 of: 1. Elon is a genius, a real world Tony Stark. 2. How dare you! You're just jealous! 3. Ok, regardless, he's done more to advance EVe and space travel than anyone else alive. 4. Oh God, he's going to cripple US development of EVs and rockets, isn't he? 5. Eh, Mars was never happening in my lifetime anyway.
  - woooooo 9mo ago
    I think he's genuinely changed for the worse, quite a lot, in the last 10 years. Staring down failure seemed to keep the worst tendencies in check, being untouchable amplified them.
quantified 9mo ago
Parent poster may have been thinking of other readers. I see it as you do, but it's a fair question.
nashashmi 9mo ago
Tesla acquiring solarcity was the same thing over. It did not make sense. Then and it does not make sense now. But the distortion field is so great no one notices.
- slg 9mo ago
  SolarCity and Tesla made more surface level sense just being in the same general vicinity since they're both fundamentally green energy companies. That made it easy to spin questions about the financials with some CEO-speak about synergy. However, the way Musk has become less subtle with this tells a story. He got away with these shady financial dealings multiple times so he's now becoming even more brazen and transparent with this behavior. We have gotten to the point in which the spin needed to justify his moves is the physics-defying viability of datacenters in space. The distortion field will keep growing as long as he keeps getting away with it.
  - anjel 9mo ago
    Which is why he's the GOPs bank now
  - throwpoaster 9mo ago
    Why are space data centres physics defying?
    - dgoldstein0 9mo ago
      Cooling. Radiative cooling is the only option, and it basically sucks vs any option you could use on earth. Second, ai chips have a fixed economic life beyond which you want to replace them with better chips because the cost of running them starts to outpaxe the profit they can generate. This is probably like 2-3 years but the math of doing this in space may be very different. But you can't upgrade space based data centers nearly as easily as a terrestrial data center.
    - boutell 9mo ago
      How do you cool them? Getting rid of heat is one of the number one challenges on the ISS.
mapontosevenths 9mo ago
Is it financial engineering or social engineering? He's all over the Epstein files and his daughter has publicly verified that the timing works out and the emails are probably legitimate. https://www.threads.com/@vivllainous/post/DUMBh2Vkk8D/im-just-going-to-speak-directly-instead-of-being-vague-and-cryptic-i-can https://www.threads.com/@vivllainous/post/DUMBh2Vkk8D/im-jus...
- irjustin 9mo ago
  At these scales, financial and social are very intertwined, it's both.
CGMthrowaway 9mo ago
What are they hiding that wasn't hidden already? Two private companies making a private transaction.. there is no mandatory reporting now nor after this move
- selectodude 9mo ago
  SpaceX investors want to cash out, which is why they’re going public. Elon Musk wants to dump his X/xAI bags onto the public markets by merging it with SpaceX. Essentially means that SpaceX investors are bailing out Elon Musk.
  - khannn 9mo ago
    Don't forget that a lot of US mil stuff is launched by SpaceX so in a very real way they are the prime defense contractor in space for the country. If the public offering doesn't work, Unc Sam'll bail them out. Wonder if Trump will want a stake in the company this time.
- rubyn00bie 9mo ago
  Because X and xAI are both losing money. X needed cash to operate, so Elon rolled it into xAI to use xAI’s cash to help fund it. xAI is likely burning egregious amounts money, but will have trouble raising more capital. By rolling it into SpaceX he further covers up the financial issues because SpaceX is actually profitable. He can then raise more capital without having to worry (for a while) about how awful the burn is… I, by and large, have a strong dislike of Musk to put it mildly. The one thing I will give him, and I think this is his real gift, is he’s absolutely brilliant when it comes to raising capital. He has proven to excel at raising capital, and deploying it well, for extremely capital intensive businesses. I do however wonder if the chickens are coming home to roost because both X and xAI are extremely unprofitable. I think it’s almost inevitable we will see Space X and Tesla merge. The conditions of that merger will, I believe, say a lot about whether this move was brilliant or batshit.
deleted 9mo ago
[deleted]
willmadden 9mo ago
What are you talking about? They are both private companies. They don't have public financial reporting.
shermantanktop 9mo ago
I understand it now, after reading the thread. There's a reason for that. I have not been following the machinations of X very closely. I don't have the corporate structure of Elon's empire in my head, nor do I have the Meta or Alphabet/Google hierarchies in there. I couldn't have told you about the history of xAI beyond that it exists. So that's plain ignorance of something you consider common knowledge, but I don't, rather than "aggressively trying to not understand it." And that phrase is particularly grating btw.
- deleted 9mo ago
  [deleted]
Rover222 9mo ago
It's really disturbing how confidently blinded you are by whatever political biases you have.
- reverius42 9mo ago
  So reveal the unbiased truth to us please -- what's the real motivation for consolidating these companies?
  - Rover222 9mo ago
    It's uhhh... clearly explained in the linked announcement.
bko 9mo ago
Hiding losses? From whom? He's the majority shareholder of both businesses. The combined company will go public and report on things like revenue, burn rate, etc. It's not financial engineering. It's a purchase. Just say "rocket man bad" and save some keystrokes.
- deaux 9mo ago
  > Just say "rocket man bad" and save some keystrokes. Hey Jeff, on what day is the wildest party on your island?
- axus 9mo ago
  Maybe he likes the xAI minority investors more than the SpaceX investors? Or he needs their support for something else. I agree we'll have to keep digging (or reading other comments, at least) to find a better explanation.
deleted 9mo ago
[deleted]
Fogest 9mo ago
But that is also just an assumption isn't it? Could this not also be related to the fact that they plan to launch a ton of servers into the sky to run in space and power AI? It would mean that their AI product would become heavily based on the services provided by SpaceX via launching all this. But regardless, I think quotes like these should have some commentary around them as it helps create a discussion around whatever point they might be trying to make rather than having to make assumptions.
- wookmaster 9mo ago
  Why would they launch data servers into space? What purpose would that serve?
  - spiderfarmer 9mo ago
    It’s hopium for his investors. Just like his robots.
- nerdponx 9mo ago
  Data centers in space have never been a thing and never will be.
  - Fogest 9mo ago
    Low orbit satellites providing internet across the world also weren't a thing... until they were.
    - decimalenough 9mo ago
      The biggest problem with satellite internet was the costs involved, which SpaceX has pretty much solved. Datacenters in space, on the other hand, are a terrible idea because of the laws of physics, which will not get "solved" anytime soon. But don't take it from me, listen to this guy with a PhD in space electronics who worked at NASA and Google: https://taranis.ie/datacenters-in-space-are-a-terrible-horrible-no-good-idea/ https://taranis.ie/datacenters-in-space-are-a-terrible-horri...
sleepybrett 9mo ago
didn't tesla just 'invest' 2bills in xai?
NedF 9mo ago
[dead]

livefeather 9mo ago

> I'm curious how you could not understand the relevance of the quote unless you were aggressively trying to not understanding it. Monet probably wondered how other people couldn't see purple in a haystack.

reverius42 9mo ago
[flagged]

senectus1 9mo ago

yeah, I am not a huge fan of Musk, but this move is just going to bring down arguably the only decent thing he's produced. Leave SpaceX alone you child. Gwynne has it in excellent hands.. find some other way to pay for your juvenile brainfarts.

tialaramex 9mo ago
Although I'm sure SpaceX would be a non-trivial loss, the most important idea - their truly reusable rocket -- is proven to the point where other people are assuming they should do that to make rockets, it's like if Benz' company goes bankrupt in 1899. In that universe the Mercedes probably never happens but the automobile idea is already a done deal.
- fluoridation 9mo ago
  What do you mean? SpaceX didn't invent the reusable rocket, and my understanding is that Falcon 9 is still not significantly more economical than disposable rockets, and that the main reason it's attractive is that it's not Soyuz-2.
  - andsoitis 9mo ago
    > SpaceX didn't invent the reusable rocket There isn’t a single inventor and reusable rockets emerged through decades of research. But: SpaceX was the first to make orbital-class reuse routine and economically viable.
  - rogerrogerr 9mo ago
    Your understanding is wrong; see page 2 of https://ntrs.nasa.gov/api/citations/20200001093/downloads/20200001093.pdf https://ntrs.nasa.gov/api/citations/20200001093/downloads/20.... That’s a log plot! The backing table is on page 8. Falcon 9 is (was, in 2018! It’s only cheaper now.) at $2700/kg to LEO. No one else is below $4k, except… Falcon Heavy.
  - jasonwatkinspdx 9mo ago
    Space is basically half the cost of it's competitors on a per kg basis. And while previous experiments like the DC-X existed, SpaceX absolutely gets credit for the first operational reusable rocket stage. And I say that as someone that despises Elon and the way he casts his companies as due to his personal technical genius.
    - fluoridation 9mo ago
      >And while previous experiments like the DC-X existed, SpaceX absolutely gets credit for the first operational reusable rocket stage. Not true. What about STS?
      - jasonwatkinspdx 9mo ago
        Eh that's a spaceplane and solid rocket booster shells which I see as categorically different, and an absurd failure on a cost per kg basis.
leesec 9mo ago
>arguably the only decent thing he's produced. such a hilarious comment / mindset. he made the best selling car in the world 3 years running. neuralink is a great breakthrough. there are a string of accomplishments which individually would be the greatest thing many many people have ever done.
- scubbo 9mo ago
  > he made the best selling car in the world 3 years running Not only did Elon not found Tesla[0], but many employees have described the "babysitters" or "handlers" who are responsible for making him feel like his ideas have been implemented, so that his caprice and bluster don't interfere with the actual operation of the company. To give him his due, he's a phenomenal manipulator of public opinion and image, and he certainly has invested a lot of his emerald-generated wealth into numerous successful ventures - but he himself is not a positive contributor to their success. [0] https://autoworldjournal.com/is-elon-musk-the-founder-of-tesla/ https://autoworldjournal.com/is-elon-musk-the-founder-of-tes...
  - Fogest 9mo ago
    I mean, even if he isn't directly making a lot of the decisions in these companies that are doing well, it doesn't mean he doesn't play a big role in that still. He still had to pick a lot of these leaders, pay them well, keep them satisfied enough to stay there, and also give them the proper freedom to lead these companies. There are many people out there who could also manage to make these companies fail instead of grow. I feel that a lot of people simply don't like Elon because of political reasons which are often also based on misinformed opinions. It also can't be denied that he is an intelligent person. You can hear it when he talks in interviews. Now I think ultimately any ultra wealthy person is going to have some flaws that people can find and latch onto in order to hate someone.
    - scubbo 9mo ago
      > It also can't be denied that he is an intelligent person. You can hear it when he talks in interviews. While I certainly won't deny that I do strongly disagree with all of Elon's politics, I'm being as fair and unbiased as I can when I say - we must be listening to different interviews. The man sounds like a caricature of a bumbling college stoner philosophy student most of the time.
saalweachter 9mo ago
I think we're around stage 4 of: 1. Elon is a genius, a real world Tony Stark. 2. How dare you! You're just jealous! 3. Ok, regardless, he's done more to advance EVe and space travel than anyone else alive. 4. Oh God, he's going to cripple US development of EVs and rockets, isn't he? 5. Eh, Mars was never happening in my lifetime anyway.
- woooooo 9mo ago
  I think he's genuinely changed for the worse, quite a lot, in the last 10 years. Staring down failure seemed to keep the worst tendencies in check, being untouchable amplified them.

quantified 9mo ago

Parent poster may have been thinking of other readers. I see it as you do, but it's a fair question.

nashashmi 9mo ago

Tesla acquiring solarcity was the same thing over. It did not make sense. Then and it does not make sense now. But the distortion field is so great no one notices.

slg 9mo ago
SolarCity and Tesla made more surface level sense just being in the same general vicinity since they're both fundamentally green energy companies. That made it easy to spin questions about the financials with some CEO-speak about synergy. However, the way Musk has become less subtle with this tells a story. He got away with these shady financial dealings multiple times so he's now becoming even more brazen and transparent with this behavior. We have gotten to the point in which the spin needed to justify his moves is the physics-defying viability of datacenters in space. The distortion field will keep growing as long as he keeps getting away with it.
- anjel 9mo ago
  Which is why he's the GOPs bank now
- throwpoaster 9mo ago
  Why are space data centres physics defying?
  - dgoldstein0 9mo ago
    Cooling. Radiative cooling is the only option, and it basically sucks vs any option you could use on earth. Second, ai chips have a fixed economic life beyond which you want to replace them with better chips because the cost of running them starts to outpaxe the profit they can generate. This is probably like 2-3 years but the math of doing this in space may be very different. But you can't upgrade space based data centers nearly as easily as a terrestrial data center.
  - boutell 9mo ago
    How do you cool them? Getting rid of heat is one of the number one challenges on the ISS.

mapontosevenths 9mo ago

Is it financial engineering or social engineering? He's all over the Epstein files and his daughter has publicly verified that the timing works out and the emails are probably legitimate. https://www.threads.com/@vivllainous/post/DUMBh2Vkk8D/im-just-going-to-speak-directly-instead-of-being-vague-and-cryptic-i-can https://www.threads.com/@vivllainous/post/DUMBh2Vkk8D/im-jus...

irjustin 9mo ago
At these scales, financial and social are very intertwined, it's both.

CGMthrowaway 9mo ago

What are they hiding that wasn't hidden already? Two private companies making a private transaction.. there is no mandatory reporting now nor after this move

selectodude 9mo ago
SpaceX investors want to cash out, which is why they’re going public. Elon Musk wants to dump his X/xAI bags onto the public markets by merging it with SpaceX. Essentially means that SpaceX investors are bailing out Elon Musk.
- khannn 9mo ago
  Don't forget that a lot of US mil stuff is launched by SpaceX so in a very real way they are the prime defense contractor in space for the country. If the public offering doesn't work, Unc Sam'll bail them out. Wonder if Trump will want a stake in the company this time.
rubyn00bie 9mo ago
Because X and xAI are both losing money. X needed cash to operate, so Elon rolled it into xAI to use xAI’s cash to help fund it. xAI is likely burning egregious amounts money, but will have trouble raising more capital. By rolling it into SpaceX he further covers up the financial issues because SpaceX is actually profitable. He can then raise more capital without having to worry (for a while) about how awful the burn is… I, by and large, have a strong dislike of Musk to put it mildly. The one thing I will give him, and I think this is his real gift, is he’s absolutely brilliant when it comes to raising capital. He has proven to excel at raising capital, and deploying it well, for extremely capital intensive businesses. I do however wonder if the chickens are coming home to roost because both X and xAI are extremely unprofitable. I think it’s almost inevitable we will see Space X and Tesla merge. The conditions of that merger will, I believe, say a lot about whether this move was brilliant or batshit.

deleted 9mo ago

[deleted]

willmadden 9mo ago

What are you talking about? They are both private companies. They don't have public financial reporting.

shermantanktop 9mo ago

I understand it now, after reading the thread. There's a reason for that. I have not been following the machinations of X very closely. I don't have the corporate structure of Elon's empire in my head, nor do I have the Meta or Alphabet/Google hierarchies in there. I couldn't have told you about the history of xAI beyond that it exists. So that's plain ignorance of something you consider common knowledge, but I don't, rather than "aggressively trying to not understand it." And that phrase is particularly grating btw.

deleted 9mo ago
[deleted]

Rover222 9mo ago

It's really disturbing how confidently blinded you are by whatever political biases you have.

reverius42 9mo ago
So reveal the unbiased truth to us please -- what's the real motivation for consolidating these companies?
- Rover222 9mo ago
  It's uhhh... clearly explained in the linked announcement.

bko 9mo ago

Hiding losses? From whom? He's the majority shareholder of both businesses. The combined company will go public and report on things like revenue, burn rate, etc. It's not financial engineering. It's a purchase. Just say "rocket man bad" and save some keystrokes.

deaux 9mo ago
> Just say "rocket man bad" and save some keystrokes. Hey Jeff, on what day is the wildest party on your island?
axus 9mo ago
Maybe he likes the xAI minority investors more than the SpaceX investors? Or he needs their support for something else. I agree we'll have to keep digging (or reading other comments, at least) to find a better explanation.

deleted 9mo ago

[deleted]

Fogest 9mo ago

But that is also just an assumption isn't it? Could this not also be related to the fact that they plan to launch a ton of servers into the sky to run in space and power AI? It would mean that their AI product would become heavily based on the services provided by SpaceX via launching all this. But regardless, I think quotes like these should have some commentary around them as it helps create a discussion around whatever point they might be trying to make rather than having to make assumptions.

wookmaster 9mo ago
Why would they launch data servers into space? What purpose would that serve?
- spiderfarmer 9mo ago
  It’s hopium for his investors. Just like his robots.
nerdponx 9mo ago
Data centers in space have never been a thing and never will be.
- Fogest 9mo ago
  Low orbit satellites providing internet across the world also weren't a thing... until they were.
  - decimalenough 9mo ago
    The biggest problem with satellite internet was the costs involved, which SpaceX has pretty much solved. Datacenters in space, on the other hand, are a terrible idea because of the laws of physics, which will not get "solved" anytime soon. But don't take it from me, listen to this guy with a PhD in space electronics who worked at NASA and Google: https://taranis.ie/datacenters-in-space-are-a-terrible-horrible-no-good-idea/ https://taranis.ie/datacenters-in-space-are-a-terrible-horri...

sleepybrett 9mo ago

didn't tesla just 'invest' 2bills in xai?

NedF 9mo ago

[dead]