Discussion in 'EtcetEra' started by Thisman, Aug 7, 2018.
With Musk's child-like outbursts and unstable posting habits there's tons of losses either individually or as a company.
Maybe the real funding secured was the friends we made along the way.
The beauty here is that even if there is no SEC action there will almost certainly be lawsuits. And then we can see if those plaintiffs prevail, and why. If everything that Musk put in his blog is true and he still losses the lawsuits, it's clear I was wrong in my interpretation. That's straight forward. If Musk lied and he loses, we all agree there. He should lose. If he wins we'll have to evaluate why. Settlements would be the least satisfying to everyone but even then we would have the benefit of a lot of expert commentary on whatever the case looked like up to that point. I'm sure we could still draw some conclusions even then.
Just to be clear I'm not arguing just to be contrary and I don't own a Tesla or any Tesla stock. I'm not motivated by anything other than my own opinion. I see and saw reactions here that I think are exaggerated or just wrong and too infrequently met with push-back or too frequently met with uncritical assent. One or the other by itself isn't really interesting but when both of those are true I generally engage.
So we'll just see how it ends, ok?
I think we've had enough back-and-forth on this side conversation of "fraud" and "manipulation". Let's get back to talking about Elon Musk's tweet and the implications of taking the company private. Thank you.
If the meeting on July 31st happened. Why didn’t Elon discuss this when Tesla released results on August 1st during the conference call or results ? Why did he wait and tweet during market hours and especially with the stock not halted. You would think a material statement like that would cause the stock to be halted pending news etc .?
so should i buy some stock or what? lol
Definitely him attempting to trigger a short squeeze.
If you were trying to go private you would never try to inflate the price before you bought it...
Thanks for your explanation, btw, you clearly know what you're talking about, your willingness to engage in spite of the necessity of breaking through a thick brick wall is immense.
Whether securities fraud and/or market manipulation occurred seem like a pretty relevant discussion to the tweets themselves and their content, given multiple class action lawsuits initiated, an ongoing SEC inquiry, and former SEC regulators making comments in the news? Even if one poster has created a derail.
Thanks for the informative thread. Some of the posts have been quite illuminating on an issue I have no experience in.
Thanks for the clarification.
In relation to that then:
The ass covering begins far too late. Things are getting spicy.
Some good coverage coming from the NYT.
On Saudi Arabia.
Also in related news one of Tesla's largest institutional holders, Fidelity, quietly reduced its holdings by 20% or roughly $1 billion worth.
It's related to the broader story of Tesla supposedly going private? And the concoction wherein less capital is needed because existing owners would not sell out and follow into an illiquid private firm.
13F disclosures don't need to be filed until I think 45 days after end of quarter. So there's no way to tell exactly what large institutions hold right now (edit: I guess you could try and piece it together from different fund monthly reports). But a 21% reduction in a quarter is sizeable.
Even with that reduction Fidelity are still one of the largest institutional holders. So their remaining 7% or so would be important in any plan to roll into a private entity. And a large reduction in their stake in the liquid asset shouldn't provide confidence they would.
This all under the premise that they even could.
Stooge have been great, I have learned a lot. Your posts were really informative, you have the patience of a saint.
This seems like it's going to be a disaster and all that Saudi money too lol
His willingness to ignore the fact he knows nothing is absolutely amazing. The George gif is perfect.
That transaction was finalized before this whole shebang even started.
If anything you could say they missed out on a ton of money because they sold before the stock price surged.
Insider trading is buying or selling (or making others buy or sell) because of insider information. Just talking about going private would be ok as long as they don't buy or sell afterwards. But in this case they sold without talking, otherwise they would not have sold.
Special committee has been formed.
This is super fucking weird.
The most plausible scenario is: Elon Musk was mad at his detractors, mad at the shorts, mad that the stock price was lower than he thought it should be. Probably had some pie in the sky plans to take it private that were not fully formed and then took to Twitter to prove his detractors wrong and "show them." Then he started talking about things he didn't understand (retail investors remaining shareholders in a private transaction) and attempting to reverse-engineer funding sources for a potential sale and the last 5 days has been some kind of Kabuki theater where the board and CEO of a publicly traded company are attempting to retroactively explain behavior that was extremely problematic away with some really odd statements that don't hold up under any form of scrutiny. And only now are they attempting to begin the process of taking the company private in order to further prove that the tweet was not a complete fabrication and/or they've hit a point where they almost need to go private.
So how will it fix Tesla's negative cash flow?
It actually does in ways a mere human can't understand.
Taking a company private makes sense if you expect a much higher market value down the road. Tesla wants to go private at a market cap of 71 billion. A company that has never made a profit. You know Volkswagen? They are kind of the biggest car manufacturer in the world, with yearly profits of around 15 billion. They have a market cap of 100 billion. Taking Tesla private is ridiculous.
Hmmm... so do I believe the comments of two well-reasoned posters with past experience in securities, or the poster trapped in the Elon Musk reality distortion field?
Thank you, Stooge and Gamechanger, for your very insightful commentary about Musk and the potential fallout from his reckless tweeting - the last thing a company like Tesla needs at the moment is a shareholder lawsuit draining away what little money they still have. I'm not a huge fan of Musk and his giant ego, but I'd really like Tesla to survive since their technology is so good and quality electric cars are essential going forward if we ever hope to address issues of climate change.
There are specific debt covenants in place to prevent that sort of asset hive down... so as long as Tesla has debt, this is highly unlikely
Taking a company private makes sense... if it is cash generative (which Tesla most definitely isn't) as you will require enormous amount of debt to finance its take-private acquisition, unless Saudis just give him a blank equity cheque (again, unlikely)
Source: work in corporate finance
EDIT: For the record, taking TSLA private doesn't make any sense to me. The only argument for it is the lack of scrutiny from Wall Street/investors/media, but it's a weak one. Tesla has greatly benefited from being a public company.
So Musk and Tesla are just straight up admitting there was no funding secured?
Because all that energy to charge Teslas come from the sun or windmills
The most stupid thing is that the stock price was already soaring when the Saudis disclosed they had reach 5% of the shares.
Stooge Great insight. I used to work in the compliance department (in Spain) of a mutual fund and i still miss it. There are remarkable similarities between US and Spanish legislation in this matter. One question, if found guilty of MM, could he be declared unfit to serve a CEO of a public company?