Elon Musk vs. Short sellers

Naked shorting is selling stock you have not even borrowed to create a short position. The scenario you describe did not require naked shorting in order to exist.

To keep things simple, imagine a corporation that has 100 outstanding shares on the public market. Bob owns them all. Mark wants to short them, so he borrows all 100 from Bob and sells them to Mary.

At this point, Bob is "owed" stock from Mark, and Mark owes Bob stock. Mary owns all 100 shares of stock. No one shorted anything naked.

Now say that Craig wants to short this company as well. He borrows 100 shares from Mary, and sells them to Sally.

At this point, in addition to the above positions of Bob and Mark, Craig is short 100 shares of stock, which he owes to Mary. Sally owns all 100 shares of stock.

Looking from the perspective of any one person, they are not short more shares than there exist in the company. No one shorted anything naked. And yet, on the macro level, there are 200 short positions, and one person owns the 100 shares of the company.

No one shorted anything naked. And yet, the situation you described arose.

Should the need arise for Craig and Mark to return the stock they borrowed (someone calls in their shorts), they will probably need to pay a lot to convince the people who own the actual stock to sell to them, especially if the owners are aware of the macro situation.

What is “speculative” is the aggressive expansion tesla is engaging in. It’s why they need cash and what is making them a target.

And he doesn't label all short sellers as "bad actors", but only those that engage in opinion manipulations at scale.

If you don't believe those things, then Tesla having a greater market cap than GM or Ford makes sense, because Tesla's future cashflows would be greater than GM's or Ford's.

Production deadlines aren't very compelling to me except to the extent that they starve a company of its operating budget. Heck, other car companies routinely show off concept cars that aren't only late but in fact never ship. It's not a big deal though, because those companies aren't betting the farm on those cars, whereas Tesla has needed the Roadster, S, and 3 to be successful to continue operating. That will be less the case on future cars though. So it may have been a reason to short up until now, but not so moving forward.

It argues that short sellers want to kill Tesla and they have a chance because Tesla somewhat resembles a financial company.

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