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Comment by hn_throwaway_99 | Hacker News Reader

I get it, it's Musk, but this is still such an irresponsible way to announce news of this magnitude. From a WaPo article:

The sudden announcement gained immediate criticism from former regulators who suggested it may conflict with SEC rules for potentially market-moving statements. Harvey Pitt, a former SEC chairman, told CNBC on Tuesday that Musk’s tweets “might consittute fraud if any of the facts he disclosed are not true” or if there was any indication that he had floated the proposal purely to boost the stock price

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According to the rules [1] it seems Tesla should have initiated the T1 halt 10 minutes prior to that tweet...

[1] https://en.wikipedia.org/wiki/Trading_halt

> to announce news of this magnitude.

Only if he's announcing news, which he likely is not. The method itself makes it feel more like a muse and less like an announcement.

[edit]

Well, everyone seems to be taking him seriously...

The founder and largest individual shareholder of a corporation announcing that they're considering taking the company private is definitely news.

Small nitpick, he's the CEO, but not the founder. Tesla loves to forget telling this part of the story, but it was founded by Martin Eberhard and Marc Tarpenning in 2003. Elon invested the next year, but didn't become CEO until 2008.

Remember when he said he was gone start digging tunnels.

Remember when he said the will but 'baseball glove' on a bot and try to catch the fairing.

Or when he said they were gone sell flamethrowers

Ignore this twitter account at your peril

Yep, and they've halted TSLA.

It's irresponsible from our point of view because we don't know much about this yet.

From his point of view, if he is serious about it, then it's not a false fact and it's not floated purely to boost the stock price, so why should he be afraid?

Because it’s the SEC. It’s the favorite tool to send rich people to jail. Of all the things rich Americans should be afraid of, the SEC probably ranks near the top, short of physical threats.

Man, that's some thick sarcasm (I hope).

The information was disseminated to all parties at the same time and they weren't in a "dark" period. I know several people are upset given their bet but I don't see this being any different than some headline in an AP release. If anything, twitter is more immediate to the masses and there's no middleman.

>Because it’s the SEC. It’s the favorite tool to send rich people to jail. Of all the things rich Americans should be afraid of, the SEC probably ranks near the top, short of physical threats.

Living in America :)...

I'm very glad that a number of countries require nothing more of public companies than timely disclosed financials.

Americans, are you happy with your country very likely having the world's most complex securities laws?

The SEC can't send people to jail, they have to refer a case to law enforcement for jail to be a possibility. It's even in the TV show Billions, or you can read about Theranos.

RE: Elizabeth Holmes "This is pretty standard practice with the SEC. The regulator explains on its website that, while it works with law enforcement agencies, it's investigations lead to civil or administrative actions. It routinely penalizes brokers and traders by banning them from working in the industry or accepting outside money. "

https://www.businessinsider.com/will-elizabeth-holmes-go-to-...

my concern is, is this an indirect admission they cannot meet their bond/note requirements? While irresponsible I am not sure if much of a case will stick if he doesn't act on it personally or have it shown he tipped others off before the tweet.

my interest being I just ordered a III on Monday. Oh joy.

>SEC rules for potentially market-moving statements. Harvey Pitt, a former SEC chairman, told CNBC on Tuesday that Musk’s tweets “might consittute fraud if any of the facts he disclosed are not true”

Have anybody given weight that even an SEC chairman can't give a yes or no answer on application of US securities law, but uses word "might"

The SEC chairman likely doesn't do the actual legal work in bringing cases to court. Would you expect Jeff Bezos to know how to navigate his warehouses and ship packages out?

I'd bet a lot of money that Bezos could do actually do that. And if the SEC chairman doesn't know the law, why is the news asking him?

I would imagine an act is not a crime till it is investigated by investigators or tried in court. Everything you hear now a days is "allegedly" because no one wants to be definitive and then get sued for libel in the chance they are wrong.

Perfect example. Nicholas Cruz ..just googling and picking an article.

"Cruz is accused of gunning down students and teachers in various classrooms at the school in Parkland on February 14, in one of the deadliest mass shootings in modern US history."

Why is he accused? We all know he did it. Why not say "Cruz gunned down..."? This is after he confessed to it, after security footage was reviewed.

No, because I'm familiar enough with law in general to know that not doing so without a complete picture of the facts is almost always an oversimplification.

All this tells me is that Pitt is being appropriately careful.

Which is kind of why he wants to go private. Because these rules are designed to prevent the behavior of corrupt CEOs, which he is not. Being public makes him richer, but ties his hands and prevents him from making certain decisions.

That sort of depends on your definition of "corrupt", and I'm not sure you can say that so definitively. Yes, Musk isn't running these companies to line his personal pockets. But he's been incredibly clear that his goal is to raise funds for his Mars colonization project, which creates a tension between that aim and his fiduciary duty to Tesla. (This is not to say he's guilty of anything, but that even intentions we see as pure don't exempt him from standard practices.)

As far as I know, he isn't trading any of his stock, so any market movement he wouldn't personally benefit from. Unless someone can prove that he made statements at the behest of someone that did trade the stock, I can't see how this breaks any laws. As an aside, since the stock is essentially a Musk sentiment gauge rather than having anything to do with the actual fiscal performance of the company it must be fun algo trading his Twitter feed...

His compensation from Tesla is based on the stock price.

Are you kidding me? He owns close to 20% of the company. How does this not benefit him?

That's too simplistic an analysis.

It only benefits him if

1. The news is false

2. He cashes out before the stock price returns to it's previous level

We can check if he is doing 2, because insider trading rules requires he announces trades in advance.

Has he announced any trades?

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