Musk announces funding secured for Twitter buy
sec.gov
sec.gov
If he tries to sell 21 billion dollars worth of tesla shares, the share price will collapse.
So no, once again he does not have funding secured. And once again he is trying to bullshit his way around the issue, although this time the bullshitting is a little more sophisticated.
It is still possible that he tries to sell a lot of tesla shares to get the cash to buy twitter, but it is unlikely.
He routinely takes out loans against his shares to disturbingly high levels.
It does seem low in comparison with the value of his shares, but banks are well aware of the self reinforcing negative spiral a margin call can have on a share price and will not give out massive margin loans.
My point is that even after he got the maximum loan he could get, and then got the maximum margin loan against his shares, he is still 21 billion short.
If you have enough cash to buy a house, you might sensibly still take out a mortgage, and you'll need to decide how much cash to put down as a deposit vs. how much to borrow. (The bank will likely set a lower limit for the amount of cash, but you might choose to put down more.) Someone could ask you "why did you choose that number", and you'd give a similar answer.
He's only putting up 62.5 billion worth of stock. So that's 20%, which is a little low but not insanely so.
Of course, he must be supremely influential with the board, but there is a governance structure that can't just be bypassed.
So why didn't the stock price collapsed when he sold $15B in December 2021?
https://www.reuters.com/markets/deals/teslas-musk-says-he-so...
Maybe buy $600 million yacht or maybe buy money losing company.
It is still possible that he tries to raise 21 billion by selling stock but I doubt it. First if he actually wanted to do that, he would keep quiet while selling and then come out with the tender offer when he had the cash.
Depending on his banking relationships, and other assets that he can use as collateral for the loan, he might be able to borrow a fairly high percentage of the current value of those assets as cash (maybe 50 to 70 or 80% or more if the collateral assets are diversified or the bank simply has high confidence in his effective credit rating or ability to repay — and he may be doing other business with that bank incentivizing them to give him a favorable deal).
I’m not a billionaire but by establishing a strong relationship with a bank, have been able to establish a credit line with a limit that is a high percentage of my assets that are invested by the bank in a diversified portfolio, along with other assets, at a low interest rate (mortgage levels - a credit line at approx 2.5% interest of an amount almost equal to my total assets at the bank).
I also recently refinanced my house with this bank starting last winter and was able to achieve getting a 15 year fixed mortgage at a 2.125% interest rate - a huge reduction from my previous rate of 3.5% on a 30 year. I now pay less per month and will own my home much sooner, consequently paying considerably less in interest over the remainder of the loan, and building much more wealth in the process.
With some wealth and favorable banking relationships you can accomplish things that most ordinary people don’t know about and I myself didn’t know about until I started looking into the possibilities. I am sure a billionaire has access to even more options than I can conceive of.
Therefore Tesla has zero input into margin rate broker decides to give Musk.
Remember that Musk is not only a shareholder of TSLA, but also an employee.
Not necessarily. It's conceivable that TSLA shareholders could interpret Elon Musk acquiring more political influence as good for TSLA. The question would be whether Musk can use control of twitter to actually influence politics in favor of his other companies. I don't know if that would actually work, but I think it's conceivable that many of those who own TSLA might believe it will work.
For that they would have to see through Musk's grift. Most retail TSLA holders are Musketeers and they truly believe that he is a visionary genius. To them, fluff like Twitter doesn't matter when they have the real life Tony Stark at the helm.
If I were a Tesla shareholder and this was his actual masterplan to maximize value for shareholders, I'd unload my stake in a heartbeat because I know his brand and business holdings will got tainted by his politics like what happened with Trump, and the plan will most likely backfire and decimate his business empire.
Doesn’t have to be either-or. Marketing strategy is an important part of running Tesla and given the empirical dislike of media establishment of him, ensuring Twitter won’t go against him on a whim of the board seems strategically important.
> business holdings will got tainted by his politics like what happened with Trump
Is there data on Trump businesses doing materially worse overall after the taint? I assume the half of US that like him bolster it and the other half see the taint but the vector sum is material here.
To be clear: Elon buying Twitter doesn't necessarily trigger any of this. Elon using that influence to actually push Twitter around in ways that are "useful" to Tesla shareholders potentially does. For Tesla shareholders I'd say the risk here is much higher than any possible reward.
I think that's probably right. But do those Tesla shareholders believe it?
I mean we could speculate at length but the condition you’re describing already exists. People have polar reactions to him. Some hate with a passion, some love him. As for boycott, I’m not surprised if a lot of people already feel like they won’t buy a Tesla. Hard to imagine it can get worse from here.
He could get indicted for the FSD scamming and bring the whole thing tumbling down. If he stuck to just selling battery powered cars I'd be a lot more bullish on TSLA, but he hasn't and I think his antics represent a serious threat to the company in the long run.
- Paypal - Tesla - SpaceX
Tells me that his success isn't a fluke. You might get lucky with one of those companies, but with three? Don't think so.
I imagine a lot of "save the earth" and "Let's go to Mars" people overlap with the "Fuck Donald Trump" people. So letting Trump back on Twitter may cause them to swear off Teslas and DogeCoin. Alternatively, not letting Trump back may cause a bunch of truck-driving Texans he's been targeting to convert to electric to tell him to fuck off.
Bottom line, it puts Musk in the unenviable position of having to piss off a third of the country by deciding if Trump has a Twitter account. And while I would still swap with him in a second, this is an additional burden he's putting on himself.
Again, Tesla is known for creating more hype fewer cars, expensive messes and underdelivering on promises - he has stimulated the market into considering alternative fuel sources, which is good but in a lot of ways showmanship not vision, more top down execution and spectacle than forethought or planning.
SpaceX is the most evident of these, Musk is busy taking tax dollars and building efficient rockets, which I guess is good but not about getting us to Mars.
So I think you are right to call out pandering for sales, it's what musk does best, not tech or vision.
It's like calling flappy bird visionary - popular yes but preceded by hundreds of sidescroller helicopter games with a single button controlling altitude. Difference being Flappy broke in on a verdant mobile market while the two color LCD version I played 25 years ago on a flipphone didn't even have Facebook to get popular on, while Flash versions of the same thing that had been out for decades suffered from anti Flash sentiment and a smaller mindshare.
Can you tell me please what you mean by this?
AFAIK, Twitter is decentralized and fragmented for any actor to orchestrate an all-out political witch hunt where everyone on the platform goes against anyone in particular.
As far as Trump's business holdings go, Trump Organization runs like a brand management firm where they license and operate businesses with Trump name plastered on them, and I believe it's safe to say that the brand name's risk profile increased greatly due to the association with Trumpism from 2015 onward.
Twitter can find an excuse to ban his account (you can easily imagine this sort of risk exists after some of his recent meme tweets for example). I believe that is a single point of failure in Tesla PR strategy and a risk to be mitigated.
> brand name's risk profile increased
Risk profile sure but has the net value decreased or increased due to his presidency? I don’t have data to say it’s one way or another but looking at the downside without the upside as well is futile.
Musk could simply setup muskannouncements.com and blog his own tweets. No one may search for your announcements, but you better believe for his site he will still get full coverage.
ergo he's not doing it for his own announcements. it will be for a mix of media influence, and to address the bias in twitters 'fact checking'
I do agree he is doing things for reasons besides his own announcements, but I cannot agree that it's not part of it. Some people may simply not care enough about EVs to bother, as technologists we assume people see the world through our lens but I bet you many people have barely bothered to research his cars, they only know Tesla in a cursory fashion the same way you might know Nissan or Kia, or even computers (people exist who struggle to use anything more complex than a power button, these can be intelligent well read people even).
If you do use Twitter say, to follow XYZ (not even certain this is correct, I don't and struggle to use Twitter although I have a general idea how it works), if they see some promoted or retweet involving a Tesla, they are likely to learn more or investigate further. Owning this would be a non insignificant marketing advantage.
an app with push notifications. email. sms.
But Elon Musk is unique, HE would still get full coverage. Journalists and influencers and the fanboys and outrage crowd would post his stuff to twitter for him lol.
The question should be whether TSLA shareholders think he is, and I think most of them probably do.
(I don't own any TSLA, btw. But from what I've seen, many of his fanboys love him for being conniving while simultaneously claiming he's done nothing wrong. I believe this is an example of double-think. But the subject of this discussion is how these people might react to Elon Musk controlling Twitter, not whether their allegiance to Elon Musk is rational and rhetorically consistent.)
I really doubt that this is the case. I know that there's some real retail investor interest in the stock price movement and for a minority the fundamentals, but I'm sure there's some institutional investors and smart money who are in it for the long run and who analyze the company's financial statements, and evaluate and scrutinize the founder's every move and decision and this Dr. Evil's scheme of taking over Twitter and turn the platform as a tool of propaganda for Musk's financial interests and self-aggrandizement looks very concerning to put it mildly.
How is it any different than Bezos buying WaPo, in principle? That does not seem to have been detrimental to Amazon shareholders. And how does having a propaganda arm detrimental to Tesla financial interests? Marketing is a euphemism for propaganda after all.
(I can see legitimate Tesla shareholder concern for Musk attention being spread too thin, but to claim having Twitter makes things worse beyond his existing presence as a user seems ridiculous.)
I'd like to take this occasion to remind you that my first comment was a rebuttal to someone's argument speculating about the motive or rationale behind this acquisition and posited that Musk's control of the platform would afford him political influence to further his own financial interests, hence my opening reply.
Clarification: Positing that many TSLA shareholders presently believe Musk's control of twitter would afford him political influence to further his financial interests.
It's not just the inevitability of less time to focus on managing TSLA (though running Twitter being a full time job was an issue for Dorsey, and he was only running one other company and wasn't at war with the management) but also the hints that this is an obsession.
If I keep myself in my personal mindset of a Musk skeptic and try to model the behavior of TSLA shareholders, I would anticipate TSLA shareholders selling immediately (today, and every day previously in the past several years), because that is what I would do if I were gifted TSLA. But that's obviously not what TSLA shareholders do, so my personal mindset evidently makes for an inadequate model of TSLA shareholders.
If instead I try to suspend my own beliefs and imagine myself as somebody who thinks owning and holding TSLA is a good idea, then my new assumed mindset says that Elon Musk getting more power, by hook or by crook, is a good thing for me.
He should be. Solidly Republican-leaning Texans are buying and driving electric vehicles, in some cases believing that doing so is "owning the libs".
Tesla seemed like an impossible long shot 15 years ago, not just for the considerable technical and business challenges but also because most Americans were happily buying gas-gusslers and even fantastic hybrids like the Prius were still somewhat niche. At the time, not a single major car company was willing to invest seriously in building electric vehicles.
Now there's gigafactory right outside Austin. It's something I did not think would have been possible. Tesla has threaded a nearly impossible needle to get to where it is in 2022.
I don't dispute that he's a shrewd businessman and fancy visionary but when it comes to the world of politics, I have my doubts and reservations.
I'd like to see action and results first before I can vouch for him in that field.
In this day and age you don't become a billionaire without being good at politics. Navigating the regulatory state is an enormous task even when you don't have people laser-focused on you like Musk would due to his wealth and size of his companies.
Could this attempt at buying Twitter be part of the same vice-signalling[1] schtick, then?
1. As in "See how I hate the same things you do?"
[0]: https://www.cnbc.com/2022/04/20/tesla-tsla-earnings-q1-2022....
Musk: I can haz money?
Bank: You said that Twitter isn't going to be a way to make money. That you "don't care about the economics at all". Your exact words.
Musk: ...
Bank: ...
Musk: Give me money
This is a insanely risky vanity project.
Within the past year, Telsa stock slide from a $1209/sh peak to $766/sh in the span of about five months.
In this case, MS has offered him a loan for 20% of the value of his stock.
A bit of an aside, but the richest person I know (as in buys multi-million dollar cars on a whim and has many many of those) says his credit score is pretty mediocre because he's never had a loan. I'd thought having gazillion dollars in the bank would give you a good credit score but guess not.
Just because you have a lot of money doesn't mean you'll make payments on a loan.
The fact that so many things require a high credit score is a forcing function for you to take on these debt instruments, and the credit score is a way for the system to optimize that it get its money.
The entire system is gamed against the consumers unwittingly or unwillingly forced to participate.
Not a bad way to buy stuff if you have the means to pay it off.
“Nah.”
“Alright, we don’t need BIGINT in the ‘balance’ column.”
Does it really?
I have a very high credit score but putting a large charge on one credit card (nowhere close to maxing it out though) dramatically drops my credit score for one month until I pay it off in full at the end of the month.
I pay my child's tuition in full for the year each August (school in California is way too expensive so it's a lot of money, but that's a different topic). I put it on the credit card to get some cash back. My credit score drops by about 150 points right away. Once I get the bill at the end of the cycle and pay it off, the credit score goes right back to where it was before. I don't get any bump though.
Here the bank can reclaim what is owed via other means.
Do you think it's easy to get someone with access to billions of dollars (of your money) to do something they'd rather not? They can tie you up in the courts for years since they're basically equal powers: an $800 billion bank doesn't get better lawyers than a guy worth $1 billion. A bank vs someone with just a million dollars means the individual is at a major disadvantage as lawyer fees can easily exceed that amount in attritional lawfare.
"If you owe the bank $100, that's your problem. If you owe the bank $100 million, that's the bank's problem."
and comes from 1976 "As I see it: the autobiography of J. Paul Getty". There were no billionaires back then. When you owe a bank 20 Billion while being worth 260 you are still in the first category.
Just look at what recently happened in the nickel markets on the London Metals Exchange when a Chinese Nickel Producer had a margin call against a $2bn short position.
Tldr: the brokers liquidated their position due to the unnecessary risk of having a margin call over a weekend.
Only one way to find out though.
I would not bet against Musk.
> (ii) A separate debt commitment letter, dated April 20, 2022 (the “Margin Loan Commitment Letter”), from Morgan Stanley Senior Funding, Inc. and certain other financial institutions party thereto as commitment parties (collectively, the “Margin Loan Commitment Parties”) pursuant to which the Margin Loan Commitment Parties have committed to provide $12.5 billion in margin loans (the “Margin Loan Facility”), the proceeds of which will be distributed or otherwise made available to Purchaser; and
The letter: https://www.sec.gov/Archives/edgar/data/1418091/000110465922...
So maybe he hopes to sell his shares to "activist buyers" who want the takeover to succeed and therefore have no interest in dropping the share price.
Of course that is assuming any of the purported motives are real and not just an act.
Someone remind me again why this isn't a cult?
I care it's the best performing stock in the last 5 and 10 years.
I care that Tesla is growing revenues at 50%+ over more than a decade, and profits even faster. Which is a better financial performance than Amazon has at similar stage.
What I do not care is your editorializing of Musk's character of calling me a cult member.
I guess I should be offended but then I take a look at my bank account and it kind of makes me not care about what you think about me or Musk.
Yet such people don't roam around screaming off the top of their lungs "Buterin is God!".
Ethereum, much like TSLA, much like betting on Trump back in 2016 are about calling an event and predicting what's gonna be the outcome of a socio-political movement.
Nobody is better prepared to predict such outcome than the guy who can keep his cool and openly admit that such social movement is really just BS and hot air, but that nonetheless it still has steam and room to grow among the populace for the time being.
What you don't want to be is a so called "true believer" as that would prevent you from jettisoning yourself once the movement runs out of steam, if you are a "true-true believer" you might find yourself storming the capitol...or in Musk's case the SEC building as that would be the aim of his rage when the socio-religious movement that he built runs out of steam as they eventually all do.
You haven't met crypto people yet, I take?
It's normal, you give people money and they worship you.
Think of the "cult" of Steve Jobs linked to Apple gains.
This is nothing new. It's also not a real cult, it's more as admiring successful entrepreneurs.
You earn yourself that money by successfully making a prediction. By the same token when you win a poker game in Vegas you don't worship Steve Wynn for providing you the casino and a table. You gave yourself that money.
> Think of the "cult" of Steve Jobs linked to Apple gains.
Apple stock gains came as the product was becoming ubiquitous among the populace, matter of fact it slightly trailed the virality of the product. Same goes for Google, Microsoft, Oracle, Facebook etc.
That is the normal financial trajectory of a company, which differs from a socio-religious movement such as crypto, TSLA, a political candidate etc. Those are all based on promises about the future and getting people galvanized without ever delivering any actual product improving people's quality of life on a scale comparable to the promises made.
> This is nothing new. It's also not a real cult, it's more as admiring successful entrepreneurs.
This is exactly what gets people burned when the socio-religious movement implodes and they fail to jettison themselves. Don't admire, limit yourself to gauge the level of admiration that other people have for the guy and try predicting if it will expand or contract. That's an indicator of the health of the socio-religious movement so that you know when to jettison yourself.
sigh
His reason - or at least his public justification - for that sale was to deliberately generate a tax liability. If you recall people were getting pretty bent about him not having such a thing, as a zillionaire.
Some people, a minority, from a particular political bend. the overwhelming majority of americans don’t consider his finances at all
Because they wouldn't be taking control over the company... That's the purpose of those whole situation. Musk isn't just making a play on the basis of thinking "one dollar of TWTR is worth more than one share of TSLA"
IIRC he made a comment about how he was "cash poor" a while back and it basically came down to he can't sell more of Tesla/SpaceX without dipping below 51% and loosing control.
I wonder what a paper billionaire's definition of 'cash poor' is compared to mine.
"[Musk] lives at times below the poverty line," Grimes said, per Vanity Fair. "To the point where I was like, can we not live in a very insecure $40,000 house? Where the neighbors, like, film us, and there's no security, and I'm eating peanut butter for eight days in a row?" [0]
In the same article Grimes complains Musk wouldn't replace a broken mattress.
No idea how Much this shows Musk is cash poor, and how much it shows crazy rich person, but it gives a glimpse either way
[0] https://www.businessinsider.com/grimes-says-elon-musk-someti...
That’s just a humble brag.
I have a difficult time believing Telsa couldn't put him up in executive housing and cover a security detail. Or, he couldn't send out a tweet and get a $50 million line of credit, uncallable line of credit to live on. Especially given that he can at get 13 billion dollars to acquire another company.
I think he likes bragging about being a homeless couch surfer.
Elon Musk is routinely selling billions of dollars: https://finance.yahoo.com/quote/TSLA/insider-transactions?p=...
* $1,007,908,791 on Dec 28, 2021
* $333,647,031 on Dec 22, 2021
* $594,924,622 on Dec 22, 2021
* $325,723,600 on Dec 21, 2021
* $528,016,861 on Dec 21, 2021
* $738,683,277 on Dec 13, 2021
As long as the trade is small compared to the daily volume, the market impact is limited.
>[0]https://twitter.com/exec_sum/status/1517137710699458560?s=21...
What are the limits and where is he now? Please tell us.
You have no idea how rich this man is, people need to stop acting like they do.
"Musk himself has committed to put up $33.5 billion, which will include $21 billion of equity and $12.5 billion of margin loans against some of his Tesla Inc (TSLA.O) shares to finance the transaction"
Even though I'm obviously so much smarter than him on matter of acquiring public companies, I'll graciously allow him to do whatever he pleases as long as he continues growing Tesla at 50% compounded rate.
Which he did this quarter, and the one before that and the one before that.
I'll be concerned when that stops happening. Until then I give him my blessing to do whatever he pleases with HIS money.
Or bullying American politicians. Or simply preventing himself from being banned.
They say the United States Congress is really just Hollywood for ugly people. In a sense, social media is really just Hollywood for smart people. Given Elon Musk's circumstances, and no matter what his motivations, they seem to be the correct ones to maximize his possible outcomes.
Trust me, I'll unleash my wrath on Musk the moment his actions cause my net worth go down due to TSLA stock going down.
But in my infinite compassion for lesser human beings, I allow Musk to continue doing things that are not 100% related to increasing TSLA stock price.
He has my blessing to purchase Twitter, if that makes him happy.
Don't get me wrong, there are limits to everything. Recently he asked if he can have a 9-th child and I said "absolutely no".
Another child would distract him from running a company and I, as a shareholder, absolutely cannot have it.
This media hijacking is similar to the way that Trump got elected in 2016.
I bet that if SpaceX ever went public it would cause Tesla to fall as everybody who wants to invest in “Musk is a genius” would invest in SpaceX instead of Tesla.
Please elaborate.
That doesn't mean they couldn't refuse to remove it, but since they should act in the interests of the shareholders, they would need a good explanation (e.g. another better offer, or a plausible plan for extracting more value from Twitter than they currently do).
The popular understanding seems to be that a companies' board is legally bound to act in the best (financial) interests of the shareholders - and only those. This is why hostile takeovers are a thing at all: If the acquiring company gets the majority of the target's shareholders on board (or becomes the majority), then the target's board of directors is legally bound to accept the takeover, even if it would be harmful to the company (nevermind the company's employees or customers)
How far does this go? If I'm a shareholder of McDonald's, could I sue them because they could have increased profits by lacing their burgers with cocaine but chose not to? (Or say some synthetic drug that's technically legal because it hasn't been banned yet).
If a company could make more profit but is kept from it by some regulation, could I sue them if they didn't try to lobby against that regulation?
It's perfectly fine for a board to say that the legal and reputational risks far outweigh the benefits of lacing burgers with cocaine.
Most decisions, such as lobbying, involve complicated calculous and don't have a simple way to verify the ROI. The board can defend most positions (from no lobbying to lots of lobbying) by arguing that they believe it's the right decision based on their experience, judgement, and analysis of the situation; probably with some written analysis defending whatever their decision was at the time.
The board would likely make a compelling case that the long-term effect of lacing burgers with cocaine is a net loss for shareholders given the inevitable reputational harm, lawsuits, payouts, etc.
He can execute an equity stock swap agreement with an investment bank and not unload any shares.
(Disclosure: I work for Google, which is part of Alphabet)
To those who would follow him on such a mission? Sayonara. He's spoken about how it would be mostly work for those living there, and I wouldn't be surprised if he tried to implement a 9/9/6 schedule.
I would trust Weyland Yutani with a Mars colony before I would trust EM.
Amdahl law applied to company performance.
Don't buy Google to own SpaceX.
Wait until Starlink IPO and buy that (if not too expensive).
https://www.bloomberg.com/opinion/articles/2022-04-21/elon-g...
Elon Musk needs about $46.5 billion to buy Twitter at $54.20 per share: about $39.4 billion to pay for the 91% of Twitter’s stock that he doesn’t currently own, about $4.3 billion of debt to refinance and various miscellaneous costs. To pay that, he has:
A letter from his banks offering to lend $13 billion to Twitter, if he buys it, with $7 billion of that coming in the form of senior secured bank loans and $6 billion coming in the form of junk bonds.
A letter from his banks offering to lend him $12.5 billion personally, secured by $62.5 billion worth of his Tesla Inc. stock. At yesterday’s closing price, that comes to about 64 million shares, or about one-third of his Tesla stake.
An agreement with himself to put up the other $21 billion, give or take.Musk controls Tesla by way of owning more than 50% of its stock. He'd be trading Tesla for Twitter, which I think anyone would agree is a terrible trade.
Ludicrous
He’s already margined a lot of his Tesla shares. The rest is largely illiquid. Tesla shares are expensive to margin, especially for $10bn; we’re seeing an unusually-large consortium of banks assemble to provide that tranche of financing. That implies having to sell large, market-moving stakes in, all likelihood, Tesla and/or SpaceX. Something feasible, but unlikely pleasant for Musk or other shareholders in those names.
Also, Musk is someone who said “funding secured” without funding secured in 2018.
Yes, though that was a Tweet and not an SEC filing
Most people, at this point, believe he has funding. When he first tweeted his bid, however, the stock dropped.
He still has to come up with $21bn. He’s tapped out on margin loans, so that will involve some selling of assets. And market conditions are volatile enough for those funding commitments to fall through.
For the reader’s consideration: Musk’s TED interview [0], he claims (quite forcefully) that he did in fact have funding secured, but effectively “pled not secured” as to get a more favorable response from the SEC.
[0]: (time stamp: 0h27m00s) https://youtu.be/cdZZpaB2kDM
"the evidentiary record demonstrated that no reasonable jury could find Musk’s tweets on August 7, 2018 accurate or not misleading. Likewise, given that Musk was intimately involved with the facts leading to that conclusion, the Court also held that he recklessly made the statements with knowledge as to their falsity"
Which is to say, a federal judge has ruled that it was inaccurate, and he knows it was inaccurate.
[0] - https://storage.courtlistener.com/recap/gov.uscourts.cand.33...
First Amendment strikes again!
https://www.cnet.com/news/politics/elon-musk-doesnt-have-to-...
I agree. The lawsuit is laughable and should be thrown out of the court.
Stock swap agreements are a thing. He doesn't have to outright sell them on the open market to get cash. Even if he did, it's not like the price is going to crater because he's losing confidence in TSLA or something.
An equity swap is a financial derivative contract (a swap) where a set of future cash flows are agreed to be exchanged between two counterparties at set dates in the future.
https://www.investopedia.com/terms/s/stock-swap.asp
While this case wouldn't be TSLA acquiring Twitter, stocks are fungible assets that can be traded as part of an agreement.
I thought that when you said that "he doesn't have to outright sell them on the open market to get cash" you were referring to an alternative way of getting cash - not to an alternative form of payment.
I'm not even sure that it would be really feasible, in any case it would surely be very unusual.
As that link says, the way it goes normally is: "A stock swap occurs when shareholders' ownership of the target company's shares is exchanged for shares of the acquiring company." But here people would not be getting shares of the acquiring company, they would be getting shares of an unrelated company. There is no reason why they would want to keep those shares, so they would quickly flood the market.
https://www.bloomberg.com/news/articles/2022-04-21/musk-is-s...
I think the story is quickly turning into more of a hype effort than actual advancement.
Twitter would still need time and labor to be re-worked, which in itself is a massive undertaking. It looks like Twitter has multiple problems in scaling beyond it's current state, and that's why it has only made gradual changes over time for many years.
Assuming Elon owns all those shares free and clear, aren't there plenty of investment banks that would eagerly loan Elon the $21B if Elon pledges ~63M of those shares as collateral? (I got the 63M number from assuming the lender requires collateral value equal to 3x the loan to protect against price drops.)
Then presumably Elon would sell 21M TSLA over the next year or three to pay off the loan and get the other 42M of collateral out of hock, but sell slowly enough not to crash the price of TSLA.
Twitter operating income for 12 m/e 31 Dec 2021 was negative. For the q/e 31 Dec 2021 it was $0.167B. Why he thinks Twitter is worth $45b is beyond me. What would Warren Buffett do? Well, he wouldn't buy Twitter, that's for sure.
* Time will tell, of course. I've been wrong before. But the whole thing seems like madness to me.
It's hard to put a price on the propaganda machine and it's network effect.
It's not really about making money with Twitter.
- edit -
@McLaren_Ferrari: I disagree it's a misguided purchase, it makes sense to me from his stated goals.
But maybe you can sell the world's richest man your financial consultant nightclub analogy and save everyone.
Trump didn't own any media back in 2015-2016. He won because he sucked the air out of the room by making hyperbolic statements and riffing off the huge news cycle generated by his hyperbolic statements.
A good and effective PR team and a charismatic deliver is all you need and it comes for much less than 40B.
This is what kids learn in nightclubs fairly early: if you want to command the club you want to be a DJ. Owning the club will leave you with both a huge hole in your pocket and in the shadow of the DJ every given Friday.
The answer to Musk "problems" is to become a good public speaker and work on his in person social game, not monopolizing an online platform on which he has by far the biggest account already. Pushing on a string that's what it is. That's about the only thing he can do to expand his virality, owning the platform is kinda redundant.
Real life still happens offline (thankfully)
My math is that Musk’s twitter activity very reasonably increased Tesla’s market cap by more than 5% which is what he is offering to pay.
Going back to Trump I think that he going quiet after losing was not an effect of him being banned from Twitter as much as it was about the post defeat depression, mixed with fear of retribution for Jan. 6th now that he was out of office and also a part of him wanting to be Presidential and not critique his successor.
There are no rules in Twitter that prevent Musk from engaging in Pumps&Dumps so he'd have to do something Trump-esque to be banned. Spending 40B to secure the capability of inciting violence and unlike Trump avoid getting banned seems way out of whack. Besides inciting violence doesn't pump a stock.
(Goes and buys The Washington Post)
Wealth has diminishing returns; he’s just trying to get more value for his exceptional personal wealth (and remember, he plans on dying on Mars, he’s playing a different game than typical billionaires). Status is his drug of choice, Twitter his platform. If you crave validation (Biden admin not mentioning him until recently, people buying ads in time square “say their [Tesla] name”), buy it if it isn’t given freely.
(observations as someone with years of therapy and a scholar of the human psyche)
Musk have a case against him by the SEC (tweeting about taking tesla private), it seems like they can win it, and he might be forced to stop using twitter.
Now I can imagine it hard for the SEC to enforce such a role if it's his private company.
So in a sense he's using that money to secure his best tool to marketing / growth which is definitely worth 50Bn$ for tesla alone (then add all his other ventures now and in the future)
Just like last time.
(And please explain how publishing stoner and dogecoin memes is worth $50billion to Tesla... ;)
Couldn't he have more noble causes in mind like trying to do the right thing for humanity (e.g. Tesla, SpaceX)? Social media is a cesspool right now, they seem to have a negative impact on democracy and humanity in general, and public social media companies have no incentive to clean themselves up because that will hurt shareholder value in the short term. Buying the company and taking it private will give him the ability to make those hard choices and try to make a social media company that is positive for humanity.
AFAIK, his publicly-stated plan is to not "clean [Twitter] up," but rather turn it into more of an un-moderated cesspool.
I'm sure he thinks that. Apparently he's a "free speech absolutist."
> Twitter not being a cesspool is an appealing fantasy, but only that.
It's not a binary condition. Twitter can be a cesspool with relatively more or relatively less shit. I'm sure his preference will result in relatively more shit.
Personally, I've appreciated a having society that lacks the shit Donald Trump created on Twitter.
I had an account I created in 2009. I had a modestly decent number of followers due to some past blogging on data science and DIY electronics. My account was suspended because I talked about the lab leak hypothesis before it was decided that it was ok to do so by The Good People™.
Maybe you hold some opinions that will also one day be unpopular with The Good People™. If you do, you'll soon find out that censorship is a very clumsy tool.
You've got to think, if someone has the exact set of approved opinions today, that's almost certainly not a coincidence, but a sign that they form their opinions based on what is approved. And in that case they're at no risk of ever having a meaningfully unpopular opinion.
Eh, no. It's more about signal to noise ratio. Because if recent history has taught us anything, it's that crowdsourced lies are often at least as compelling as the truth.
> My account was suspended because I talked about the lab leak hypothesis before it was decided that it was ok to do so by The Good People™.
Realistically, "un-moderated" will be 99% Qanon and Stop-the-Steal and 1% the kind of stuff you say you posted. The most obsessive have the loudest voices in those spaces, and people who believe wacky things seem to be more obsessive than those who don't.
Now it's officially a credible theory[1].
This is exactly why moderating "The Truth" is so dangerous. The people claiming to be the arbiter of the truth are politically motivated and self serving.
[1] https://www.cnn.com/2021/07/16/politics/biden-intel-review-c...
He could also do much worse.
Then don't you think people shouldn't have so much money that they can literally control society? What a facile stance.
I think the online giant platforms are another problematic avenue of control, I don't object to that characterization, but I'm really saying that saying "other's money is none of your business" can't be a good-faith statement in a world where money can control livelihoods and laws with such ease.
It absolutely can. I have no problem with the fact that money can buy politicians.
I have a problem with the fact that politicians can be bought in the first place.
Which are 2 completely different issues. If you had loads of money, you’d play the game too.
Well, you can, but it’d be massively hypocritical and an opinion that’s easily dismissed
Edit: parent comment cleanly and completely changed due to my response, what a world. Cowards.
If anything, we should not only be scrutinizing the hell out of Musk’s stated intentions, but also scrutinizing those people in the Twitter organization who have the power to manipulate the public message, and ensuring that there are checks in place to keep falsehoods and anti-democracy messaging out of social media.
I mean, really, “mind your business!”? So let’s pretend it’s some other mega-billionaire, shall we? We sure has hell don’t want the likes of Putin purchasing twitter, do we? Give your head a shake.
Edit: ah, shit, I see later in the thread you double down. What a waste of my time. Don’t bother responding, IDGAF.
Why should he?
> ...Social media is a cesspool right now,...
He would have greater impact if he used his account to not add to the cesspool, then. Much more than if he bought the company and kept tweeting like he does.
If that's the goal, why not simply found another social media company built around those values?
Surely he has the means to attract tech talent to do it, the means/message to attract users to a new platform, and presumably if he knows what's bad about Twitter and how to subtract it and make it good, he could do this greenfield.
This would result in increased platform diversity, too. And I'll bet you it's cheaper.
Imagine if Musk had tried to buy a big three automaker in order to make electric cars happen.
Twitter is one of the few social networks that actually has a network. A lot of social media failed because the cold start problem is a very hard problem to solve at this point in the game. Elon probably knows it and I would bet that this is why he is looking to buy an established social network rather than creating a new one.
Musk has market-moving clout and a cult of personality, so the remaining question would be if he has a compelling insight into distinguished features.
If he doesn't, he won't make Twitter better. If he does, he could make a greenfield platform a success.
People have tried to do what you said. Let's make a Twitter that's not controlled by the hard left! The result was Twitter's ideological allies at tech firms immediately banned them from every platform they controlled, and other allies ganged up to hack and destroy them.
You cannot start a Twitter competitor today, it's impossible, because:
1. The sort of people who found companies tend to be pro-free speech because their economic survival depends on having risky but correct ideas, and that naturally leads to a sympathy for free speech.
2. The sort of people who hate free speech are obsessed with Twitter/tweeting platforms specifically.
3. They are exceptionally aggressive. They will do anything, including damaging their own companies and even breaking the law in order to stop any other platform from becoming popular. They've managed to take over tech firms to a sufficient extent that they will destroy any attempts to replace Twitter, which they see as a key pivot point in their power over society.
The obvious solution: buy Twitter and fix it. It's too big to ban. This also has the major benefit of really, really upsetting Musk's ideological enemies. They'd hate him anyway and many are in powerful positions in politics and the media. Even the thought of losing Twitter to Musk has very conspicuously driven them into a frenzy in recent days, and such frenzies discredit them in the eyes of the general public, thus weakening their ability to move against Musk.
Bad analogy. Social media platforms are natural monopolies. The utility of a car doesn't grow with how many other people own that model. By contrast, Twitter's utility is basically just a function of the fact that all the relevant players use it.
If this was the case, Facebook wouldn't have needed to buy Instagram and Whatsapp. Or hell, there wouldn't have been FB because MySpace would have been king forever.
Network effects are real and they can help sustain engagement and mindshare but given how easy it is to move fluidly between multiple forums (social or no), the next competing platform is one compelling reason for engagement away.
Like what?
And haven't we already established that no amount of money thrown around is going to actually fix "hunger around the world" or "health care around the world". How many billions have already been dumped down that hole to little effect?
And idk why your so cynical about results. Just one example is Bill gates helping with polio vaccines.
Anyway I thought you were asking for better ways to actually help the world then buying Twitter. Plenty of research needs funding.
https://www.cdc.gov/mmwr/volumes/70/wr/mm7049a1.htm
https://abcnews.go.com/Technology/wireStory/polio-outbreak-s...
https://abcnews.go.com/Health/wireStory/polio-cases-now-caus...
Why not both?
I think you’re giving him too much credit here. It’s male appendage measuring at this point, like with most three comma club members.
So you're gonna bundle people with $999B and $1B together, just like that?
Bullshi!t proven.
Is buying twitter an example of that? He may make a buck but I'll 100% disagree.
And what? You think he earned 260 squillian dollars?
No, his shares were brought to that level through the demand of those who purchased shares in companies he owns.
It's not 'his' 'fuck you' money at all.
At this stage, he's using societies capital for entertainment value ... the support for him is cult like.
The whole spectacle is obscene and pathetic.
Don’t think for a moment that he does not pay a team of promotionists. Every public forum is monitored and “influenced.” He is not a completely stupid person and he obviously understands social media. Of course many of those in this very thread that argue against those who say “bad things” about Musk are being engaged by his paid mouthpieces. It is very much in his best interests to spend pocket change amounts to counter all criticism. It is absurd to think otherwise.
The problem is, being smart and thinking misleading people via online influence is smart aren't the same thing. moistly, in mistaking intelligence for oppression, I think you are dooming yourself into accepting a potentially false belief. Many very intelligent people value integrity.
You asks us not to think for even a moment. Fuck that. What happens when we do? The finances at Tesla are public knowledge because it a public company. They don't have an advertising department. It seems reasonable that Elon might not believe in paid promotions as much as some people. So a reasonable person might entertain the thought that -- and now we've transgressed your command to not think for even a moment.
> Of course many of those in this very thread that argue against those who say “bad things” about Musk are being engaged by his paid mouthpieces.
I'm not being paid by Elon Musk to post this. I publicly declare right now that I will retract my assertion that you are trapped in an epistemic pit and give you one hundred dollars if you can prove that at least four people in this thread are being paid by Elon Musk to counteract criticism. I will welcome this public disgrace if you teach me better, because I strongly believe that accepting criticism from you so that my beliefs are more accurate is not absurd, but of great benefit to me.
> Of course many of those in this very thread that argue against those who say “bad things” about Musk are being engaged by his paid mouthpieces.
Claim 2
> More the fool you, though, if you naïvely believe that the ultra-wealthy don’t manage their public image!
In one you claim that people in this thread are doing it. In the other you claim that it is a thing which is done. These are two different claims.
You think people who disagree with you are fools, because you think misleading others is wisdom. I think you can escape, because I think you know that Putin is a moron. Do you agree that it was stupid of him to spread misinformation, ultimately resulting in deception prospering so much so that he lost sight of the truth, leading to ruin? If it was stupid for Putin, then why can't it be stupid for others? Look, you point to Pharaoh. He is dead, his empire is dead, and his fancy pyramid didn't help him. You point to politicians - Hitler killed himself. You point to Scientology - do you think them clever and wise, that they have the truth; I don't. Why are you pointing at idiots? Why are you pointing at dead men? Why do you think they are so clever?
If you had evidence that people were being paid, you wouldn't need to point to unwise dead men! Get out of the pit. Where is the oppression you claim? Where are the people being paid? Where is your evidence? Show me a check. Show me a paystub! Show me an account name which can be hired through an online service. Show me that I'm wrong that your beliefs are not rooted in your preconception that it is wise to mislead. I confess that I believe that it isn't absurd to be corrected. Criticize me! Point out my flaws! I will be better for it.
I am not talking about claim 2. I am talking about claim 1.
Also, from the Hacker News site guidelines:
> Please don't post insinuations about astroturfing, shilling, bots, brigading, foreign agents and the like. It degrades discussion and is usually mistaken. If you're worried about abuse, email hn@ycombinator.com and we'll look at the data.
> Comments should get more thoughtful and substantive, not less, as a topic gets more divisive.
I eagerly await the day you present concrete evidence of your claims that many here are being paid by Elon Musk to promote him, but I grow more and more certain with your every reply that you have no such evidence. If you did have the evidence, you would collect a hundred dollars quickly. Since you don't, you call me a fool and pretend I speak drivel. I could call you a liar for that, but I won't. I think you are confused enough that you believe your own false claims. I completely forgive your insults.
However, I must insist you not see yourself as wise in your own eyes. You who proclaim that others should not "think for even a moment" have no place whatsoever mocking at cultists.
A lot of people downvoting, so I'll expand; It's fair to give the benefit of the doubt given that Tesla is helping combat climate change and SpaceX is about becoming multi-planetary. These are civilization level problems and solutions.
The idea is to make twitter a TRUSTED public square. He suggests open sourcing the algorithm and making all moderation actions visible to the public. Makes sense as transparency is needed to rebuild trust in the platform.
The analogy is about misusing a high minded principle to further selfish - or even morally negative - ends.
It is, indeed, a good analogy.
a. Nothing Musk is doing or wants to do with Twitter is immoral.
b. Even if you disagree the scale is totally wrong, but in analogies the sense of scale matters.
Some fine example of antebellum Southern imagery there.
I love practical joke, keep 'em coming!
I totally believe that you would do that, I don't believe that Musk would do that, a guy so petty he once cancelled someone's Tesla order after he dared to make a 'rude post' on the internet, with an interesting justification about the nature of private businesses' ability to discriminate:
https://twitter.com/elonmusk/status/694802955170553861
https://www.theguardian.com/technology/2016/feb/03/elon-musk...
https://www.businessinsider.com/elon-musk-offered-5k-remove-...
It certainly wasn't an attempt to silence a critic, which is the thing people say he'll start doing when he gets control of Twitter.
The data isn't "completely public". It takes non-trivial skill and effort to access this data.
I sure don't know how to do it.
It significantly rises the bar from "a whacko" to "a whacko with technical skills to access FAA monitoring system"
When some billionare buy private jet he is aware about fact that his jet can be easily tracked. If person decide to be a public figure he have to deal with fact that he'll be tracked around.
Would you be happy knowing that all the criminals in your area now have easily accessible information on when you're home or not?
There's nothing stopping someone doing that. It's only someone gathering information that anyone else could and tweeting it. Just because you can do something, doesn't mean you should.
I would gladly accept that in return for hundreds of billions, with which I could afford some former special forces bodyguards. And house guards for when I'm not home.
Musk has since long ago pursued a publically disclosed plan for Tesla, for the company to release progressively more affordable electric vehicles, so the current growth rate in number of vehicles sold could very well be sustained for years to come.
Beyond Tesla's own sales, its success has sparked massive investment by other carmakers to push their electric vehicle manufacturing timetables forward. There is no reasonable case to be made that Tesla has not had a massive impact on pushing the world to replace gasoline vehicles with electric ones. And most people consider that to be good for the environment, even if you now don't.
As for mistakes, the company can afford many small to intermediate missteps and still accomplish what I described, because the company's momentum is already pushing it to accomplish these achievements.
The grid has not responded well, that is history. Fast Charging stations are a huge draw, and home recharging raised the bar for substations everywhere. It will take decades to respond.
Battery advances - well that's a crystal ball I don't care to gaze into.
And company momentum is a myth. Cash flow is king - the day you don't make payroll, you close. It's a markov chain with a terminating condition. Play any markov game long enough and you reach that node and its all over. So a gamble every time.
As for batteries, you don't have to bet on battery advances, just the scaling up of manufacturing, which is already underway.
So assuming that most of those two million sales weren't in lieue of the sale, or at least use, of gasoline powered cars, doesn't seem reasonable to me.
But let's be extremely conservative in our praise of Tesla, and say that the company took one million gasoline powered cars off the road and replaced them with electric cars. That is quite the accomplishment if you accept the premise that electric vehicles are better than gasoline-powered ones for reducing the impact on climate.
[1]https://www.reuters.com/business/autos-transportation/lifeti...
[1] https://www.reuters.com/business/autos-transportation/lifeti...
Do you have a bone to pick with EVs? This seems cherry-picked/straw man to me.
The 80k+ you refer to assumes electricity is sourced 100% from coal, which happens never in the US.
Even West Virginia, a haven for coal, it’s only 88%. Wyoming is also in the 80s. There are a few in the 50-70 range, but most states are sub-35, with many being 0.
[edit] For our most populous states, CA checks in at 0.1%, NY 0.1%, FL 7%, and TX 16%.
https://www.nei.org/resources/statistics/state-electricity-g...
This article shows how US sources of electricity have changed in the past 20 years or so.
https://www.nytimes.com/interactive/2018/12/24/climate/how-e...
Contrary to what you state, I would say that EVs are doing a good job at lowering overall emissions from passenger vehicles, and this will become more true as renewables increase their percentage in our electricity production mix.
The “U.S. average energy mix” comparison of 14,800 is much more accurate.
Not to mention the equation gets more and more favourable to EVs with each passing year.
That's a rather extreme assumption. The article you linked to also gives the more representative figure of 14,800 miles for "U.S. average energy mix (23% coal-fired, plus other fossil fuels and renewables)".
To put things in perspective there are only 12 states that are majority coal powered (according to 2017 numbers[0]):
1. West Virginia - 93.2%
2. Wyoming - 85.7%
3. Missouri - 79.8%
4. Kentucky - 78.2%
5. Indiana - 73.2%
6. Utah - 70.5%
7. North Dakota - 64.5%
8. Nebraska - 59.8%
9. Ohio - 57.2%
10. Wisconsin - 55.1%
11. New Mexico - 54.8%
12. Colorado - 54.3%
[0] https://stacker.com/stories/3356/states-producing-most-elect...
[1] https://electrek.co/2019/10/21/tesla-model-3-100000-miles/
[2] https://www.findmyelectric.com/blog/how-long-does-a-tesla-ba...
Do you mean to say that the majority of people believe this is how private companies should operate? If so, Id love to hear your reasoning for thinking that, because I would disagree heavily.
Saying racist stuff is legal, but its still going to get you kicked out of almost every bar, with few to no complaints from other patrons.
I don't think it's reasonable to give the benefit of the doubt to [highly debatable claim] based on uncritically accepting other [highly debatable claims].
Regardless, "helping combat climate change" is at best an incomplete description of Tesla, in the same way that Nestle is not perfectly captured by "Good food, good life" ; these are potential side-effects, rather than inarguable core missions.
We should be wary of accepting the slogans of profit-driven organisations as the truth. Wendy's is focused a lot more on selling than locating beef, for example.
[1] https://www.forbes.com/sites/timabansal/2021/05/13/how-green...
One can praise Tesla while still acknowledging that it should not be blinded trusted to always work in the public interest, and also while recognizing Tesla's contributions alone are not enough for human civilization to get to zero carbon.
Minimizing how significant Tesla's contribution has been relative to other carmakers', and in fact, the vast majority if not all other companies in general, is not an honest way of addressing these inadequancies and challenges you highlight, and suggests to me a motivation unrelated to environmentalism behind it.
I kinda like A LOT not having tail pipe smoke around me all the time on the streets...
Some things are actually more important than money -- Twitter can offer enormous power in setting a national narrative even if little economic benefit for Musk.
I'm always skeptical about this. Twitter is dominated by journalists, celebrities, and tech people. Only about 23% of American adults have twitter accounts. Only 46% of those even open it daily. Of the active users 10% account for ~95% of tweets. Among those, ~70% identify as Democrats, and certainly aren't going to be swayed by Trump getting back on twitter.
It just isn't clear to me that twitter even matters in the realm of US politics. Voters just aren't really there, and when they are they predominantly aren't engaging. When they do, they're mostly democrats tweeting at one-another.
A lot of the news articles talking about the effects of facebook focus on how many people "saw" a particular post. Given how those impressions are gathered, I'm no convinced that a significant percentage of those impressions resulted in people actually reading the post or even the headline, let alone that resulting in any real world outcomes.
I think the people that build social media applications want everyone to think that they have the power to shape discourse and outcomes, and newspapers who's ad revenue is undermined by social media also want us to believe social media is dangerous. Those two things do not make it true.
In 2020, Biden received 81,000,000 versus Trump's 74,000,000; the difference is 7,000,000.
Facebook may well be more powerful, but Twitter is still matters.
I REALLY doubt it. Of the 28,000,000 daily users, mind you that means they open it once a day, 70% get news from the app. Of those only 37% say it increases their political engagement. This is roughly 7 million people who report any change in political engagement in the US as a result of looking at twitter. These people are overwhelmingly democrats living in big cities. I'm just not convinced that such a narrow, concentrated slice (2.7% of adults) of the the US population is really that big of a deal.
Now you could make a case that twitter maybe matters more in other places outside of the US, but that's not really related to the trump/no trump issue that I was replying to originally.
Now they are syndicated in a number of other papers, discussed broadly on social media, cable news, local tv news, and across a number of new podcasts. Their reach is probably a good bit greater than the ~5 million subscribers. I would also note that 100% of subscribers are getting news from the NYT, because well obviously, so that's something. They do seem to have some sway on Democratic primaries sometimes, and do seem to shape opinions among a certain class of people. What does that all add up to? I don't know. Do they matter in the realm of US politics, probably, but I'm no sure how to quantify it.
Weido and Wechat may have more users, but they aren't newsmakers. Just like there's more people at a Def Leppard concert than in the White House, but the White House makes news.
[0] https://www.npr.org/2021/06/04/1003284948/trump-suspended-fr...
https://news.ycombinator.com/item?id=31110766
Please learn how comment threads work.
Nobody cares about Facebook, even though it's hugely used it's a dead letter.
That's not really true is it? My understanding is that it's actually the smallest of its immediate peers in social media. And perhaps the same in the field of the broader definition of media.
As a separate issue, my personal sentiment on social media, like a number of others I know, is that it has all become a steaming pile of toxic garbage, not unlike the pile of junk mail I dutifully retrieve from my physical mailbox once a month (and even then only so that the mail person has room to add more). My concern on a deal like this is that if that sentiment takes off in the mainstream a property like Twitter could experience a MySpace style collapse overnight.
Twitter is a great way for Musk to get into social media without having to get users and build the infrastructure. He can compete at a worldwide level with Facebook on day one.
1. News such as an HN post which is a ... twitter link
2. News in an article or on TV that reverences a ... twitter link
3. Social media referencing a ... twitter link
There's a lot more than appears at first, even if you aren't consuming news on Twitter or Tik Tok a lot of it is being broken there.
Twitter is a media weapon, and Musk knows this. This is a platform for Musk to push his agenda.
Why is it that people that have an agenda assume that steps towards neutrality are simply an opposing agenda?
Correct, but journalists, politicians and companies do, which is all it needs. Twitter has been way more influential than it deserves to be for a while now.
> While Twitter does not report its average revenue per user, one independent analyst pegged Twitter’s ARPU at about $17 in 2020, around one third of Facebook’s.
Twitter is being mismanaged or at least not living up to the theoretical potential when compared to its peers. It might never get to facebook ARPU levels, but it can approach it
https://digiday.com/media/the-rundown-twitter-bets-on-long-f...
If you are holding yourself out as a growth company but also paying dividends, it creates a mixed message, because if you are growing shouldn't the money be better spent on growth than just giving it back to the shareholders?
My guess is layoffs aren’t considered as an option since it would signal that they’re throwing in the towel and don’t believe in their own growth trajectory.
[0] Average salary here is a conservative guess
Twitter is a lever to all the journalistic organizations on Earth. Its impact is not measured by its operating income.
The operating income of a superyacht is also negative. But billionaires keep buying them.
Some people get to a point in their lives where the numbers no longer matter.
To its shareholders, Twitter is a business. To someone who can buy Twitter, it's a hobby.
Purchase like Twitter are to seize the platform; period.
Dissenting opinions, and bans, then become whatever the owner of the platform desires.
How do people not see the actual value of Twitter, which goes well beyond money.
He lies quite a lot about his business intentions and reasoning. It's not surprising that people don't trust him and wonder what the real reason is, since no one believes the reason he's giving (other than uncritical Musk fanboys).
Lie. Full self-driving is not feature complete in 2022, and won't be for years.
"Am considering taking Tesla private at $420. Funding secured." - Elon Musk in 2018 https://twitter.com/elonmusk/status/1026872652290379776
Lie. Funding was not secured. Musk is still doubling down on this one.
There was an incident where the EPA gave the Model S a range of 391 miles, and Musk got upset and claimed the left the key in the ignition overnight, which the EPA denies. Musk provides no evidence, but neither does the EPA, so I guess this one is "Makes weird claim contradicting a government agency that has no reason to lie", but I am inclined to believe the EPA over Musk. (https://www.theverge.com/2020/5/1/21244556/elon-musk-lie-epa...)
These are a small sampling of examples, you can look at Musk's statements over time about Tesla, the Hyperloop, and his future intentions regarding the various bizarre whims he adopts monthly, and there's tons of stuff where exaggerates and overstates, but also plenty where he straight up lies and completely misrepresents the truth. Particularly with anything Tesla related, he's actually more straight up about SpaceX capabilities, for whatever reason.
Are you sure that you're not confusing failed predictions with malevolent lying?
In fact I'm not sure this really has much to do with NTs and autistics. I think this sort of dynamic occurs all the time even between people who are very similar (but never identical!) to each other.
With Twitter all he seems to care about is the idea, the name, the userbase and some of the technology. I don't think turning $45b into $100b is a top priority, there are easier ways doing that.
What, pray tell, other than ad tracking is their technology?
If you remove the ads and the surveillance, Twitter is 60 lines of Perl.
The world being as unpredictable as it is, the conversation may also move to another medium tomorrow.
Doing anything on Twitter scale has significant technical challenges.
If you remove ads and surveillance Twitter isn't 60 lines of Perl. Just their frontend, without even getting into problems of scale, is already much heavier than sixty lines. It also happens to have been an influential technology export [1].
You can find more than sixty projects, not just sixty lines of Perl, open sourced by Twitter. While some of them are related to ad tracking and surveillance not all of them are [2]. Although I haven't checked, I would be shocked if any of them are below sixty lines.
The idea that modern tech companies can be replaced with sixty lines of code is exceedingly naive. There are certain problems that naturally come up at scale like the regular failure of hardware, hot users, persistent dedicated attacks by intelligent malicious actors, and regulatory requirements around data handling which, even taken alone rather than together, demand more than sixty lines of code to adequately address.
Twitter may be simple in theory, but you are quite clearly provoking a straw man conception of the value of Twitter's technology. If you weren't, you wouldn't need to lie or exaggerate to the point of absurdity.
[1]: https://getbootstrap.com/2.0.2/ [2]: https://opensource.twitter.dev/projects/
> What, pray tell, other than ad tracking is their technology?
The person you are responding to is largely repeating first-party accounts of motivation - Elon says he believes that producing greater transparency in algorithmic moderation and active moderation at Twitter, understood as a technology owned by Twitter, is a core ideologically rooted reason for the takeover. You can get this first party account of motivation by listening to the TED interview with Elon Musk which covers the topic of why he feels Twitter should be taken private and why he feels it would benefit from having its moderation practices be incredibly transparent to the point of open sourcing the entirety of Twitter and making their moderation process public.
There's no way he gets into Tesla without giant government cash incentives.
It makes it impossible for the board to say no without having a good reason. They have a fiduciary duty to examine the offer and determine if it is best for shareholders to cash out at this price. And the answer to that is it probably is because Twitter has never had a good path to long term profitability.
So yes, he is having a laugh. I am sure if they agree he will find the money. He just doesn’t care. He sees a poorly run company that is making decisions against his freedom of speech ethos. It is an easy target.
It's akin to buying your way into the opinion section of every newspaper if not in magnitude, certainly in direction.
If he really cared about freedom, he'd just make a new platform with the $54B. But it's not about that. At best it's a laugh, at worst it's about control.
In general we have laws against tracking individuals.
What he does seems legal but it doesn't make it good or ethical.
FAA didn't create a plane tracking system so that a kid can put this info on a map in real time. It's a legitimate security risk for those planes and people who use them. It's an abuse of the system.
In fact it's not even Musk's plane, he just owns the company that owns the plane, Falcon Landing LLC. The twitter account didn't actually know if it was Elon Musk being flown or a bunch of burros being ferried back and forth between US states.
>FAA didn't create a plane tracking system so that a kid can put this info on a map in real time.
You're right, the FAA made the system open so that anybody could do this, not just this kid.
Freedom of speech has to come with some caveats or its dangerous as it can be used as a weapon.
Either Twitter is a private company and they can ban whoever they want for whatever reasons they want, or they’re a public square and we need to make sure that everyone can read the tweets they want to read.
I’m fine with either option, but I’d prefer a little less hypocrisy from everyone who praised Twitter when they banned certain accounts. You can still follow terrorist groups on Twitter but the previous US president is banned. That is insane, and I don’t care how many people disagree with that statement. It’s still true.
So if the stock price stays above $50 he has not lost any money
However he is into multiple businesses that are deeply embedded with politics and governments. Electric cars, space program contracts, telecommunications - all need the right kind of governments to succeed. Twitter has shown to have large effect in politics, it makes quite a bit of sense to own and control that thing if you like to own and control the government.
If his motives are purer, it also makes sense to try to improve the society with a portion of your wealth. You don't have to donate your money to the cancer society, you can engage in philanthropy through building something good instead.
I mean Tesla P/E is like 209. 209!! GM PE is at 6.
Where does this tremendous difference come from? A Tesla evangelist would say, well Tesla is doing self driving, Tesla is doing electric cars, it's the future of technology! Then they go buy shares. Or join Tesla as an engineer and work 90 hour weeks.
Where does this enthusiasm come from? Surely it isn't from the actual technology in the cars, which is and has never been distinguished to such a degree from competitors. Before you go and say that Telsa had electric cars first, go look at how many units they shipped: while they were making promises, they were not physically manufacturing or delivering that many cars; by the time Tesla did ramp up production to the scale promised by their media image, consumers could buy electric cars from Ford, Toyota, GM.
Simply put, most of this stellar valuation is based entirely off of the media sensation of Tesla, which is completely and inextricably bound to the media sensation of Elon Musk. This $50bn or whatever Elon is paying for Twitter is basically fabricated from whole cloth not by technology or fundamentals -- but from Elon's Twitter itself!
This is a common pattern to Elon's business ventures, and I would argue, it's the primary reason for the success of Musk companies. The playbook is simple:
1. Be Elon Musk
2. Make an insane promise, probably on Twitter
3. Convince redditors to buy shares in the venture;
4. Meanwhile, convince redditor STEM people (engineers, programmers, and so on) to work like dogs to make the venture possible;
5. Stay in the news cycle [Post on Twitter] about the venture.
6. Keep doing (5) until the technology is possible (this can actually happen sometimes, because of step 4!). If it's not possible, extend the hype cycle due by doing more of (5); if it's never possible, either bail out the venture using shares from a different venture, or shutter it -- and make sure Elon newswire isn't paying attention to the fact that it failed, by doing another (2)!
If you can do a few of these things at once, you can get basically all redditors to give you their money to hire all redditors to attempt this insane shit (Mars? Humanoid Robots? Brain Computer Links???). I'm thoroughly convinced that nobody on planet earth except for Elon Musk can do it. It's actually incredible what he's able to accomplish. And no, I'm not talking about the technology.
I don't buy in at those PEs, but I clearly should have as the track record has shown has shown. The future remains uncertain, his goals are still incredible to the point of being uncredible, and his delivery on those goals has been real and incredible. What a conundrum, no wonder people are talking about it so much. ¯\_(ツ)_/¯
In the meantime we have reusable space rockets and actual progress on a process of transformation away from ICEs.
On the one hand, my god what they are doing at SpaceX, Starlink, (and even some parts of) Tesla are incredible! And I suppose without Musk playing carnival barker, these things aren't possible.
On the other hand... the approach is so slimy and really should not be celebrated the way it is.
It's a similar feeling with Martin Shkreli. He did some fraud, but he also gave all the money back to investors and started the ongoing conversation about Rx pricing.
It may be beyond you, are you also saying it's beyond all Twitter's investors too? Have you asked them?
By generally accepted rules of engagement the totality of investors think that Twitter is worth 30% less than what Musk is offering.
That's the difference between Twitter's market cap and Musk's very tender offer.
There's no better way of asking investors how much they value a stock than by allowing them to bid in an open market.
He's definitely demonstrating how toothless the SEC is. It's just good at empty threats. I'm not sure what the bigger joke is: the SEC or the financial industry's multiple private watchdog corporations like FINRA which masquerade as public regulatory bodies.
Anyone remember the Musk tweet about how his AI is so much better than anyone in the market realizes?
Did no one notice that this is all happening within a month or so after Twitter added a dislike button?
Would both positive and negative sentiment data for one of the largest under-monetized repositories of social data have any value to an eccentric billionaire with some major AI R&D focus?
He's not buying Twitter to defend the first amendment.
He wants the data for his AI stuff. That's just not nearly as popular a PR slant.
> "To finance the Proposed Transaction or a Potential Offer, entities related to the Reporting Person have received commitment letters committing to provide an aggregate of approximately $46.5 billion as follows:"
"A debt commitment letter"
"A separate debt commitment letter"
"An equity commitment letter"
Am I understanding it correctly that effectively $0 is coming out-of-pocket for purchasing Twitter?
Why can't anyone do this? I'll promise you a bunch of debt and equity, too.
I'm taking a broad definition of "trust" that includes "we can sue you and recover the money."
By that logic though -- if you're a billionaire, could you try to buy every profitable company on borrowed money?
Eventually you'd make the money back and since you don't have to pay anything out of pocket, you effectively have $INFINITY dollars to bargain with.
He has no "infinity" of anything. It's called leverage and it probably maxes out around 60-70% of everything he owns.
Musk has 100 billion of TSLA say.
He mortgages it to buy TWTR. Now he has 100 billion of TSLA, -40 billion loan against it, and 40 billion of TWTR. He could mortgage TWTR and buy something else, but it would have to be smaller, because the banks won't loan 100% of the value of the thing.
Or he'd have to make another $40 billion and pay off the first loan to mortgage it again.
Think of it as trying to use mortgage properties in monopoly to continue buying other properties.
Unless you're on robinhood: https://www.bnnbloomberg.ca/robinhood-traders-discover-glitc...
Maybe we'll see a wallstreetbets post "Musk couldn't take TWTR private but I did via robin hood bug"
He was once talking to an ambitions entrepreneur about funding a buyout with junk, and the entrepreneur asked, "This is a lot of money. How do you know I'll replay it?"
Milkin says he replied, "Because if you miss even a single payment, I'll call your debt and take not just the company, but every single asset you own."
———
* That would be presidentially pardoned convicted felon Michael Milkin. The rules for "righting injustice through pardons" are very different for the rich than the comfortably well off, much less those living paycheque to paycheque.
Why should it stop? Do you not believe in redemption? Milken has done (and continues to do) a lot of great charity work with his fortune.
Besides, if you look at what Milken was actually convicted of, it's pretty tame, especially by today's standards. And he spent two years in prison for it. What more do you want?
So if we are saying, "Everyone convicted of a felony who serves their time and who then rehabilitates themselves should be pardoned," I'm all for it. And in my jurisdiction (Canada), people can apply for Federal pardons, and many receive them. There is a standard way to do it, a standard procedure to follow, and in theory, everyone is treated equally by the system.
The injustice comes in if there is a special fast-track for a pardon one gets by hob-nobbing with your fellow wealthy oligarchs, one of whom is elected President and gives you a personal pardon. That's a bad look that suggests that all felons are equal, but some felons are more equal than others.
Likewise, I am extremely leery of talking about "doing great charity work." Reputation laundering is my preferred term, and again this is not something available to all citizens. Nobody gives a crap if some felon donates $1,000 to a soup kitchen, but donate $1,000,000 and you get called a "philanthropist."
I'm all for charity and doing good works, but I'm not for giving philanthropists anything special in terms of justice that people who can't afford to be philanthropists get.
IMO, the answer is not to burn Milken's pardon, it's to pardon more convicted felons who do their time and then turn their backs on whatever criminal acts they used to commit.
People are afraid to expose themselves to liability for hiring a felon, even if said felony is ages ago, because if something goes wrong everyone will say "well you shouldn't have hired a felon."
I do not believe in random justice where connected people can be pardoned even if they deserve so when there are literally millions in jail who could be as deserving.
Sadly important today, pardons can be corrupt. Trump several times promised pardons for people willing to go to jail for him. And he delivered on those pardons.
So yes I believe in redemption, but not by executive decree. That belongs in a time when we had kings with real power.
Finally, the prison time is often from a plea bargain (I do not like those either but different story). So the time sentenced to does not always have a meaning.
however, I'm not confident "anyone" could secure the funding, so they can't "do this"
https://www.bloomberg.com/opinion/articles/2022-04-20/elon-c...
The long and short of it is that the people who would lend him money may not trust him due to his previous (and erratic) statements.
he has a net worth over 200B, why couldnt he raise 40B?
I feel Elon Musk could literally mint NFT of his face and sell them to raise the cash
"The rich have all of the money and pay none of the taxes. The middle class pay all of the taxes and have none of the money. The poor are there just to scare the shit out of the middle class so they keep going to those jobs."
—George Carlin, 1937-2008
UPDATE:
As some replies have pointed out mortgage interest on a primary residence is permitted in some form in six countries: The Netherlands, Switzerland, the United States, Belgium, Denmark, and Ireland. If you live in one of these six countries, my comment does not apply to you. If you live in any of the nearly 200 other countries in the world, it does.
YMMV: "Your Mortgage-interest-deductiblity May Vary."
What a strange example to pick. That's, like, THE major write-off that most people have. It just gets obfuscated by the fact that most people don't go over the standard deduction.
Up here, home mortgage interest is only deductible if the home is used to generate income, so it does not apply to people who use a home as their primary residence. But what if you have a home office? What if you use it as an AirBnB some of the time?
If you ask a tax accountant whether Canadian home mortage interest is deductible, they will answer "a definite maybe." But it's actually "no" for most people who don't structure their home ownership around qualifying for a deduction.
My mortgage interest became "worthless" for that when the standard deduction was raised. I'm still better off than before, but that particular part of the benefit is gone.
Since California by many measures is large enough to equate to a "country", It would be fair to add it to the list of places where primary residence (and a second home too) mortgage interest is largely deductible.
> The Netherlands, Switzerland, the United States, Belgium, Denmark, and Ireland allow some form of the deduction.
That's six out of roughly 195 countries in the world. Perhaps you live in one of them, but billions don't.
This is demonstrably false. But then again, you don't expect factual accuracy from a comedian.
> As some replies have pointed out mortgage interest on a primary residence is permitted in some form in six countries: The Netherlands, Switzerland, the United States, Belgium, Denmark, and Ireland.
This Wikipedia sourced list is obviously not exhaustive. And interest deduction is allowed in the US which is the relevant case here.
And China[1]. And India[2]. (Although I don't know either country's housing market and therefore don't know how to interpret upper limits).
Between the US, China and India, it seems like most people and the biggest economies do that.
[1] https://www.chinadaily.com.cn/a/201812/23/WS5c1e2dc0a3107d4c... [2] https://www.bankbazaar.com/tax/mortgage-tax.html
You can promise all you want, but you have to get the bank to be willing to pony up the money - but what you're describing can and does happen - leveraged buyouts were common in the past. https://en.wikipedia.org/wiki/Leveraged_buyout
You find a company with no debt (say, TLSA) and you believe it is undervalued, so you convince banks to loan you enough money to buy TSLA and pledge TLSA itself as the collateral. If the purchase goes through, you now own TLSA and a TLSA sized debt. If it doesn't, nothing much happens.
A cursory Wikipedia search shows the baseball team owner referenced above put up significant real estate as collateral.
I don't have a million dollars, but I can buy a million dollar house. A bank promises to lend me a million dollars contingent on buying the house and then the loan will be collateralized by the house, which I don't own yet.
I wonder what Tesla shareholders think about all this ;-)
> Tesla has a policy in place of letting directors and officers only borrow up to 25% of the value of their stock. And Elon Musk has already pledged about 88 million shares against indebtedness, according to Tesla's 2021 proxy filing. That leaves him with only another 85 million shares to raise debt with.
https://www.barrons.com/articles/tesla-ceo-elon-musk-twitter...
Any sort of hedging strategies we can expect a lot of money to flow into?
If it ends up not being profitable, the bank takes back the house (or Twitter, or more likely the TSLA stock Elon put up as collateral)
If you can buy a valuable asset for $1 and have a bank cover $9 and it yields 10% return, you're making $1 from $1 invested (minus interest) compared to someone that bought it outright (making $1 on $10 or 10% return). The bank has no upside. If you invest in something bad though or the rate is too high the math changes and you lose 100% if the asset ends up being worth <= $9. That's leverage
On a related note, I always find the loans where the borrower takes on personal liability are in a completely separate category of risk. Anytime you put yourself in a situation where you could possibly ruin your future prospects or mortgage your future labor to a financial institution is much different than your net worth (and your investors' principal) simply going to zero.
In some states, such as California, a purchase loan is non-recourse, so you could walk away (and many did in the last housing downturn) and the bank can't do anything beyond take the house.
This means if you can weather the downturn you don't get wiped out, you borrowed 80% of the house to buy, put 20% down, it went down 30%, you were underwater, but continued to make payments, and now it's up 20% above where you started.
Margin loans against stocks, etc do not have this, so if you borrowed against $1k worth of stocks you had, and they dropped in value below what the bank wants you to keep as collateral, they can force you to sell at the lower price (or produce more cash/collateral). This means that with leverage you could be right in the long term but wiped out in the short term.
You still have to pay off your debt to the lender according to the plan set out in the loan agreement, where will these come from?
You haven't crossed the finish line by securing the loan, you cross it by transferring the title to your name and repaying the loan (principal + interests) fully.
a) $21 billion of Elon's ("Reporting Person"; see item #1) own money
b) $12.5 billion in margin loans arranged by Morgan Stanley
c) $13 billion in debt from Morgan Stanley
The major feature of a margin loan versus other types of loans collateralized by assets is that the value of the underlying security (collateral) is tracked and depending on the terms of the margin loan, the lender has the right to issue a "margin call" demanding additional collateral or cash if the underlying securities have declined in value. These rules, called "house requirements," vary from lender to lender.
You can get approved for a margin account at TD Ameritrade right now, and then later decide to margin some shares for whatever reason. The bank doesn't need to check your collateral because it knows how much it is worth at any given moment when the market is open.
Mortgage loans are not nearly as formalized, and the bank will send out an appraiser to verify that the property is worth an amount that they're willing to loan against.
And once you get past that, it becomes very hand-wavy; banks making loans to governments, non-profits, private companies, etc will all have their internal departments that make decisions about how much the risk is and what premium they'd need to charge.
If you're MS, why would you want to treat stock as "normal" collateral instead of using a margin loan? Is that Elon only feels comfortable using so much of his stock for a margin loan, and wants to use the rest as "normal" collateral (but is then getting less favorable terms for it)?
It's also possible that Elon is getting a lower rate for the non-margin loan, but at a much worse multiple (putting up far more shares as collateral).
But that's all making stuff up.
Musk is putting up some of his Tesla stock as collateral on the loans. The effect of this is pretty similar to if Musk had sold his Tesla stock and used the money to buy Twitter, but avoids some of the tax and regulatory consequences of doing that.
Most of the ultra-wealthy live on debt. Here's the basic scheme:
- Let's say I own $10B in startup.com stock, but haven't sold it. My income tax burden is $0.
- If I sell the stock, and taxes are 40% in my country, I get $6B, and the government gets $4B.
- If I keep the stock, and borrow against it, I pay no taxes, but I do pay finance fees (e.g. interest). The finance fees work out to less than taxes.
The trick is to never realize gains or income. Debt lets you do that.
One more trick is that a lot of purchases are "investments." If I buy a mansion, yacht, and Picasso on debt I can use them. When I'm bored of them, I sell them, and pay off that debt. I've probably made money on the mansion and Picasso, and lost money on the yacht.
I've paid a little bit of interest and a little bit of tax, but much less than I would have otherwise.
Another is that, should the need arise, stock can be sold at the drop of a hat. It is liquid and fungible so a stock-collateralized loan is seen by banks to be a very safe investment. Houses are not.
In this case explicitly I suspect it has more to do with the uncertainty of the deal going through AND not wanting to incur the tax penalty ALONG with the share penalty (liquidating $30 billion in TSLA would affect its price for sure). If you sold the shares to raise the cash, paid the tax, and then the deal didn't go through and bought the shares back, you'd be out the tax (with a stepped-up cost basis to be sure).
I'm not following the whole lifecycle. You borrow against your stock, spend that money, and then repay the loan using stock? Without having technically sold the stock?
I guess the risk here would be that the stock goes to 0, you get margin called AND you are now on the hook to pay taxes.
Let's say you have 10 million in stock.
A typical margin account allows you to borrow up to, say, 40% of that. That's 4 million dollars.
Let's say you borrow $1 million and spend it. Currently interest rate on a margin loan is under %2. So every year the amount you need to repay grows by $20k (2% of $1 million, for simplicity I don't count compounding).
So in 10 years that would be $1.2 million to repay. But you're authorized for $4 million.
If in those 10 years the value of stock doubles to $20 million, then you're authorized to borrow $8 million - the amount you can borrow grows faster than the amount you need to repay.
To be clear: eventually you have to repay it but in the corner case it could be done when you die.
There are of course caveats. If interest rate increases dramatically, then the amount to repay will grow much faster etc. but you can see how e.g. if you have $10 million then you could borrow and spend $100k to live a good life and never have to sell your stock to fund your life (especially if stocks keep going up faster than interest rate, inflation and your spending habits)
I know Ken Lay did that exact chain of events a lot to cash money out of Enron before it's bankruptcy.
Aligned self interest is the engine of capitalism.
You don't care if society would be better of if you donate your time and skill to company X for free. You care that company Y will pay your for your time and skill and that's why you work company Y.
The good of society doesn't enter your calculus. Only the good of throwawaycities
Similarly the banks don't care what is optimal way to allocate capital for the good of society (apparently as decided by you).
They care about their self interest. Their business is providing loans so they provide loans to people most likely to repay those loans.
From the perspective of the bank, margin loans are the safest loans they can give because the collateral is fully liquid and under the control of the bank i.e. the moment the borrower crosses margin loan threshold, he gets margin call and the bank sells his stock to ensure the loan gets repaid.
Study the wildly successful economies of communist countries to see what happens when people think they know better that free market what should or should not be allowed in the economy.
So far good intentions have vastly inferior economical results than lightly regulated free market where, for example, participants decide what kind of loans they want to make.
Thank you.
As a preliminary matter, as investment vehicles publicly traded stock is a liquid asset, whereas real estate is an illiquid asset. Generally one invests in liquid investments so that they can be readily converted into cash when needed.
From the tax perspective a building/building owner would at all times be subject to continue paying property taxes. If there were some equivalent wealth tax for stock holders then at least society wouldn’t lose out entirely on this kind of tax avoidance scheme designed for the rich, but I’d still probably prefer these billions in bank loans go to qualified home buyers before lending it to the world’s richest man to circumvent a taxable event.
It could change rapidly and people can get wiped out quite quickly when it does.
On the flip side, selling the assets would have no strings attached to the cash.
Further, it is definitely not guaranteed as you assert.
So if you don't sell the stock and thus have no applicable capital gains tax, then you can be loaned NaN dollars?
One of the main reasons is that today's cash is in essence a rave-club bracelet - you need it for every day transacitons but as a store of value it is useless to harmful. The whole idea of today's currencies is for the financially illiterate people to get robbed of their savings. You don't become that wealthy by being that stupid.
Edit: I used billion instead of trillion, apologies
No it isn’t, the financially illiterate don’t tend to have much savings anyway. The point of controlled inflation is to prevent the financially literate from hoarding cash as an appreciating asset and provide tooling to alleviate economic crisis. Considering your quote I’d question just how financially literate you yourself is.
Hint: It doesn't - you just stated a completely separate fact as if it is logically incompatible with the original argument.
Well, nobody contradicted that statement, as that is generally accepted. The contradicted statement is "The whole idea of today's currencies is for the financially illiterate people to get robbed of their savings.", which as (i parse it) is a statement about purpose of such properties of today currencies, so it is contradicted by a different statement about purpose of these properties: "The point of controlled inflation is to prevent the financially literate from hoarding cash as ..."
It's supposed to be safe but if it has zero risk, then it has zero return.
Inflation is a bit like maintaining the pressure in the pipe of the flow of money.
Inflation also has the effect of discounting debt, which means it is good for borrowers, not lenders. Most people are borrowers, in terms of things like house mortgages and other debts. That's a good thing, but you also don't want wages to have to grow too fast with prices.
Your rhetoric is using lies to pull at peoples emotions, it’s the same thing all right-leaning libertarians spout. It has and will continue to be bullshit.
1. https://news.gallup.com/poll/266807/percentage-americans-own...
Watch how fast it falls when people realize how absurd it is for Tesla to be the sixth largest company in the world by market cap, with a trillion dollar valuation. The meme voting era of stocks is coming to a close. The weighing portion of the cycle is coming and it will not be kind.
The vast majority of money is "imaginary" in the sense that it's just liabilities on some bank's balance sheet, AKA bank deposits.
> Why can't anyone do this? I'll promise you a bunch of debt and equity, too.
Anyone can do this. Nothing is stopping you from writing me a note for $1,000,000 and me writing you a note for $1,000,000. This leaves us both a million richer in assets and a million poorer in liabilities. At that point even hinkier stuff can happen like me using your note as collateral on a loan to further expand my balance sheet. The tricky part is getting third parties to accept our IOUs. US Banks have no such trouble thanks to their membership in the Federal Reserve system. This is one major reason why a banking license is such a huge deal.
On top of that there will probably be “imaginary money” where a bank will give him money to buy Twitter with Twitter as collateral, but not the whole thing, just part. I.e. loans against his personal capital will provide a kind of down payment for loans against the value of Twitter.
In this scale it’s called leverage, banks loaning you a multiple of assets you’re willing to risk.
It is quite common for people with extreme net worth to take loans out against assets instead of selling them.
Especially when selling those assets would require paying capital gains taxes.
Reed Hastings would currently being losing a lot under this scheme.
But I think now I've been able to work it out. There's actually two different types of loans but we treat them equally. The first is the nice type, the 'I built a factory, used that factory to pay back the loan with interest', that loan is a positive sum loan, the company wins, the bank wins, and the community wins. The second are loans for land, loans for stock, and other similar loans - these are zero-sum loans. The company can win, the bank can win, but someone is losing, and as is the community.
And so the real problem with this if you track how the money flows - a possible scenario is that a company might take out a bond, use the money for that bond to buy its own stock. The people who sold that stock and got that money might then go out and buy a house, the people who sold that house - you betcha, put that stock into an index fund, which includes a larger and larger share of the companies buying their own shares. Now that their share price is raised, they have more equity, and can once again take out another bond to do it again. It's a positive feedback loop. Each cycle is inflating the bubble. Valuations end up not being based on actual productivity, but on assumptions as to how money will flow through the markets.
We're at a stage now that the stock market flows of funds is only positive because of the stock buybacks. Companies that aren't buying back their stocks are going out of business. The Russel 5000 is getting punished despite the s&p recovering. We're at a stage now where north of 40% of all money is being held behind passive flows. We're now seeing the consequences of that with things like Netflix - when the stock does drop, it drops quickly and massively. Average volatility might be down considerably, but peak volatility is up massively.
Why is that?
A proposal to correct this is to require that when you use an asset as collateral for a loan you have to reassess its value and pay capital gains taxes on the increased basis between when you acquired it and took out the loan.
Basically there needs to be friction and taxation with equity transactions like these loans.
If the interest paid is tax deductible, then the selling of the stock won't result in a tax needing to be paid.
Once you upgrade your brokerage account to include margin loans you're allowed to borrow up to, say, 40% of the value of your stock (I simplify, the exact rate is dynamic).
Say you have $1 million in stock.
You're allowed to borrow up to $400k. You have a line of credit of $400k.
Say you borrow $100k. And in this context "borrowing" is simply transferring money from your brokerage account to your bank account. There's no additional paperwork as in most loans.
Let's say over 5 years you accumulate $10k interest (interest rates are really low, can be below 2% right now).
You don't have to "repay" that $10k or the principal. You now owe $110k which is well below $400k limit.
It's a line of credit, you can still borrow additional $290k.
In the limit that line of credit would only have to be settled when you die.
We know that no companies pay tax (ignore the billions paid in tax), and no rich people pay tax (ignore the billions paid in tax), so therefor all taxes must be paid by me personally.
Or so the arguments go.
2. elon uses this money to buy twitter
4. Interest is cheaper than tax Elon would pay if he sold those shares instead of borrowing against them.
By the time he has to pay it he'll also have to pay tax on the accumulated interest.
He'll pay the interest AND the tax on the principal AND the interest.
Everyone can do this. Just call your bank and get commitment from them to issue you a $40B loan! Those "commitment letters" are contracts. It's a known bank with known assets saying it's promised to issue a loan in the stated amount for the stated purpose.
It's the same thing that happens when you make an offer on a house. You don't generally come to them with the money "out of pocket", you show them documentation from your bank that details your mortgage contract. But the mortgage doesn't actually exist yet because you don't own the home. It will execute at the same time as the purchase, generally through some kind of escrow process.
Things aren't any different, fundamentally, even five orders of magnitudes higher.
But if you don’t have sufficient collateral your broker will just tell you to get fucked.
Old thread could not be replied to, probably because too many days past.
If you are stock-rich and you can buy stuff on the collateral for that: normal people can't really do that. Ordinary people have a much harder time buying more stuff than they have the cash for. Or at least on worse terms when they do take out a loan.
Being rich is cheaper than being poor. Is it really so awful to change that?
I imagine there’s a reason people feel more comfortable lending to Elon than to people with a smaller amount of assets, and that it’s not “lol fuck poor people”.
High level, it closes a financial engineering loophole (buy, borrow, die [1]). The taxable event is when you get liquid, and a loan is liquidity. The tax code requires a patch, that’s all.
I agree buy, borrow, die is a problem but the “weird” feature of tax law that makes that possible is the step up in basis. (Getting rid of that has its own challenges I’m sure.)
My issue with the whole "Elon has to pay taxes" thing is that there are loads of people (fans?) fighting over why he shouldn't have to. It's the richest dude in the world, he really doesn't need defending for everyday people.
I also like the cool stuff he does, don't like the non-cool stuff he does, as I do with a lot of people really
When those bits of stock bits are then transferred to ordinary people, they would be entitled to a bit of the dividends of eventually all companies.
Not thought this all the way through and I'm very much not an economist, so there are lots of impracticalities.
In a way, it's the opposite of 'cease the means of production': distribute the 'means' of capitalism.
They do it with homes all of the time, what are you talking about?
Of course, this tax increase could be offset by also allowing unrealized losses to act as a tax deduction.
Should the 1st tweet NFT be taxed at its last sale price? The recent failed bid price?
Did you only read the first line of my comment? I specifically said that unrealized losses should also be a tax deduction.
Nobody disputes that it’s a nice idea to make life easier for the poor. The mechanics of how you actually do it are the hard part.
The funny thing is that hoards of people will come to defend a rich dude who really doesn't need it while poor people constantly get fucked over and could use a little bit of defending.
One improvement could be to just have a higher tax bracket (like the US had decades ago) and build more stuff for the common good. What doesn't help is that from my side of the big pond, the US sounds like a third world country if you are below middle-class. Can't judge if that is true for myself, but hey.
I don’t know if that’s a fair characterization generally, but it’s not the case with me and it’s actually a frustration/lament I have when discussing this topic.
I’m not particularly a fan of Musk or any of the current crop of billionaires or their companies. But I care about the principles and the practicalities.
There’s this tendency to say “There are terrible problems in the world. We need to fix them with money. Where can we get money from? Billionaires!”
But when you do the maths, i.e., total up all the wealth that billionaires have and divide it by all the people/causes in the world who “need more money”, you end up with basically nothing.
And that’s before you consider what the billionaires’ companies are doing - which in many cases involves things like making phones/goods/software/knowledge cheaper/free, which benefits everyone including poor people, making electric cars affordable and ubiquitous, which will benefit all humanity and the environment long into the future if it leads to climate change abatement, and creating millions of jobs including many for low-skilled people, and also that these companies do generate vast amounts of tax in the form of sales taxes, income/payroll taxes, and capital gains taxes when shareholders liquidate their shares, and you find that it’s not necessarily true that taking money away from these companies/owners would be net beneficial for society anyway; it could easily make the problems worse.
And now for the obligatory disclaimer - yes I know there are plenty of valid concerns about the merits and ethics of what companies do, and worker pay/conditions and externalities and other issues; but these are matters for regulators and consumers to consider and are separate from the principle of how billionaires should be taxed or how beneficial it would be for billionaires to be taxed more.
I’m also not in the U.S., and I see plenty of dysfunction in that country as well as many others - though we also see many people, including some of the world’s poorest people desperate to move there for a better life.
For what it’s worth I devote a large number of my brain cycles to contemplating how life could be better for the worst-off; I’ve spent much of my adult life dealing with health challenges that caused great difficulty in achieving steady employment and financial security, which I’ve now largely overcome, and do I think a lot about how the principles that helped me could be applied more broadly, including for people far worse off that I ever was. At this stage I find myself thinking there are certain things that could work, but a lot of it is just really really hard.
Suppose there is a company with 200 shares, half of which you own. The last trade price was $1 per share, meaning you have $100. But you can't necessarily dump your shares for $100 because the $1 was based off the last trade. So on the margin you can sell a share for $1, but you won't necessarily be able to sell all 100 shares for $100.
Imagine you own a home that went from being worth $1 million to $2 million. Did you MAKE $1 million? Should you pay taxes on that delta as soon as the home's value became $2 million? It makes more sense to wait until you sell it and pay taxes on the net you made. Otherwise it's more complicated and you could end up paying taxes on $1 million when you end up selling it for a lot less. You could have a tax credit I guess but you're unlikely to have the IRS cut you a check for the money you paid that turned out to never be actualized.
Wealth is closely correlated enough to power that it's worth encouraging people to turn those on-paper gains into liquid forms - even if only to avoid "losing" if the stock then slides back from 100 -> 50. Especially since he can leverage it to spend in other ways!
Most proposals to tax giant piles of wealth in the market look nothing like what you've described. A wealth tax is more like: pay 1% per year on the current market value of your portfolio, if that amount is over $100 million.
Money attracts money. Wealth taxes are an attempt for reverse that effect and force some of that money to trickle down.
That said, any attempt to implement a wealth tax will probably be struck down as unconstitutional because moneyed interests want it to be declared so.
Wealth tax is different and I think it makes more sense compared to unrealized capital gains. But its not true no one is proposing an unrealized capital gains tax
> Biden’s fiscal 2023 budget request released Monday would impose a 20% minimum tax on the unrealized capital gains for households worth at least $100 million.
https://www.bloomberg.com/news/articles/2022-03-28/manchin-p...
To me, taxing wealth and only wealth seems like the most straightforward route to a truly progressive tax system. That’s not to say it’s simple or straightforward in an absolute sense, but neither is taxing income, is it?
At a high level, taxing wealth instead of income or transactions ensures that rich people are paying their share, while maximizing upward mobility so that people can become rich more easily. Think about how much easier it would be to become wealthy without income taxes, sales taxes, property taxes, taxes on corporate profits, etc. etc.
This is what we should optimize for imho: making it as easy as possible to become wealthy. Sure, there details to figure out, as with any approach, and maybe some rich people will face some difficult choices or be forced to sell assets; I’m ok with that and it seems well worth the tradeoff.
Pair it with a hefty pigeuvian carbon tax and you could probably do away with income taxes entirely.
(A nondistortionary VAT to replace sales taxes and corporate income taxes would be nice as well.)
What you are talking about is reputation and it will always be a part of the dynamic. It happens at the poverty level too. In any poor community there are people you trust and people you don't.
people are conflating Musk's personal balance sheet with Twitter's. it's not clear to me whether any debt would be recourse to Musk—but in all likelihood, it wouldn't be. "recourse" is a term used to describe what collateralizes the loan. if the loan is recourse to Musk, he'll have to cover the cost if Twitter isn't spitting off enough cash flow to service the debt. if it's non-recourse, then the only collateral available to the creditors is Twitter and its assets (potentially subject to certain carve-outs). most rich people don't do recourse transactions as a risk mitigation measure. however, non-recourse debt is costlier because the universe of collateral available to the lender is slimmer
why can't anyone do this? because Musk has been deemed a better sponsor / steward of capital than your average joe
1- Saudi company borrows $7B from Turkish banks to buy 55% of Turkey's largest internet and telephone provider.
2- Drive the provider into $4B debt (it was debt free when bought)
3- Pay the new holding company $9B in dividends
4- Don't pay the initial money borrowed to purchase the company.
5- Somehow borrow another $4B from Turkish banks to pay the new debt, and pocket that money as well.
6- Government creates a consortium of banks to bail the provider because its too big to fail.
Outcome: Provider is in debt, banks lost all the money, banks needs to spend unknown amount to get the provider back into a functioning state.
Those are legit. Banks don't sign notes without some intent. They can back out, but they are not meaningless.
It's important so that the current shareholders and the board know that Musk's bid is legitimate, and not something he's just making up.
In order for the banks and others to back him in this bid, he will have had to provide with with a lot of info.
This could be a big PR move, but Musk will have had to hire very expensive bankers to actually go through this as if it were a real thing.
"Why can't you do this?"
Because Goldman and other Private Equity firms won't back you (well, assuming they won't). And they won't give you a letter to the board of Twitter saying they will.
If it was Buffet then it would be 'almost a foregone conclusion'.
Not with musk.
Musk has gained $10-30M in free publicity thus far. He's made the front pages of the news everywhere in the world.
He can hardly lose here.
And I'm not a Musk fanboy or anything.
In this case Musk is buying using TSLA (and SpaceX?) shares as collateral, not having TSLA buy.
Tesla nor SpaceX would have no reason to buy Twitter, so Musk has to do it himself.
He has Tesla shares, that's kind of a secondary thing.
It's a leveraged buy out - banks and other firms would be going in with him. A bit like you buy a house.
Then you get a form of a financial standoff where each party checks that they're getting what they want, and you escrow/sign everything.
The dude does own 200B + worth of publicly traded equities.
The poison pill is essentially a gun to the head of all the other shareholders: you're either with us or against us. Help us fight this hostile takeover or get diluted along with Musk. How will people react to that?
Some will jump at the chance to buy discounted shares. Others will be unable or unwilling to buy more, and sell to avoid dilution. But they'll have to sell to people who aren't currently shareholders, because shareholders have a better option. That'll drive the price down, and also reduce the discounted price for shareholders. Will investors that buy in after the poison pill is triggered also get the discounted price? Will existing shareholders wait to buy discounted shares until after the exodus lowers their price?
There are so many feedback loops and non-obvious motivations here. It's possible that Musk could trigger the pill, stand back and watch the stock crater, then buy it cheap. And if the stock does crater, will he then have to compete with other takeover bids?
The poison pill seems suspiciously like a free lunch for the board if you only look at the 1st-order effect: Musk is diluted, and loses billions. That right there is enough to stop a rational investor. But it's partially a bluff. The board doesn't hold much stock (except Jack) and the assumption that all the other shareholders will pony up cash to double their exposure is probably wrong. Many will, perhaps most will. But the share price will take a hit, and Musk is free to acquire as much stock as he wants. Maybe he can't get every last share, but he might be able to take control.
Again, I agree with you that it's unlikely to happen, but if there were ever a time to question the conventional wisdom, this is it.
1. It's the first offer.
2. Twitter has traded higher very recently --- as have other tech companies, creating a plausible argument that the current share price is a sectoral thing that will correct itself.
3. Little has been done to optimize the short-term share price.
4. It's a valuation Musk assigned while saying he was uninterested in making money from the deal, suggesting that it's the lowest plausible valuation for the company, not the highest.
Musk has a simple next step: he can complete a tender offer and get commitments from a majority of the shareholders. If he can't even do that, the board will have been proven correct. If he can, still more things can happen that could prove the board correct (not least of which would be a higher offer). If nothing happens to prove the board correct, then ultimately Musk will acquire the company, if that's truly his plan.
Not having a "poison pill" seems like malpractice under the circumstances.
Musk's offer is well above current stock price, within the range of similar take over bids. Certainly nothing that qualifies it as "coercive low-ball bid".
> first offer
Yeah, because no one else is interested in acquiring money-losing business. Board's remedy should be to secure better offer, not a poison pill
> stock price was higher
This is an argument in favor of accepting bid. Investors are telling us that Twitter is a sinking ship. Musk comes in willing to pay well above the current price.
The alternative might just as well be to watch the ship sink lower and lower.
"Poison pill" that dilutes shareholders will not bring stock price higher.
> Little has been done to optimize the short-term share price
Love the suddenly passive voice, trying to not name Twitter board and management responsible for Twitter's bad performance.
At the same implying that they can wave a magic wand and push stock price higher. Makes me wonder: why didn't they?
Again, the remedy for the board and management would be to present a credible plan to improve Twitter business and therefore stock price.
Instead they created a poison pill which, if triggered, will tank the stock price and dilute many existing shareholders (not everyone will decide to give Twitter money for the cheaper stock).
Almost certainly it'll tank the stock price. But more importantly, reduce market cap.
> not the best possible valuation by Musk
Or it is actually the final offer and Musk is not bluffing.
Again, it doesn't matter. Musk doesn't have to come up with better offer.
That's not how any of that works. It doesn't work that way if you're negotiating a salary, a price of a house or a price of a business.
If board can secure a better offer from someone else then Musk will have to up his offer or not buy Twitter.
If not, then this is the best offer Twitter will ever get and it's significantly higher than the current value of the business.
Again, poison pill is not a remedy here.
If the board is wrong, and Twitter is worth less than Musk's offer, Musk will eventually get the company --- either because the board will relent after Musk's tender is successful, or because, next year, Musk will succeed in replacing the board.
The rest of your points basically just add words to things I said. It's not the case that I know for a fact Twitter is worth more than Musk's offer. It might be worth less. There is now a process for the market to judge who's right. Nor was Musk's original offer "coercive"; it couldn't have been, because it wasn't even an offer. The coercive offer is an eventuality the pill protects against, not something the pill reacts to. One outline of a coercive offer is "I will pay $54/share until I get enough shares to control the outcome, at which point I will use my control of the company to have it accept $10/share for everyone else". That's the kind of thing a shareholder rights plan prevents.
So, as I said before: if you're right, Musk will end up owning Twitter. If he can't even manage the tender, the board will instead have been proven right.
Of course, if he ends up with the company, the parade of horribles associated in message board consciousness with poison pills will have been debunked (the pill will not have prevented him from acquiring the company). And if he gets the company, but pays more per share for it, the board will, again, have been proven right.
You KNOW Musk has no intention on converting unvested RSUs to cash. He'll either get rid of them completely while giving everyone a 10% raise (common Twitter TC is 50% cash 50% RSU) or keep everyones cash the same, and tell them their RSUs are now amazing options that will be worth soooo much when Twitter gets relisted in the future
Is that possible? I guess it is but wow, I would be beyond livid if my compensation changed due to this.
But the scenario that you KNOW is going to happen doesn't seem likely.
I guess I can only speak for myself at Google which has a similar high percentage of pay as RSUs, but if they suddenly took away everyone's stock grants, nearly everyone would quit.
More often these stock options for non-publicly traded companies are not liquid until they IPO. Which a startup engineer at SpaceX completely expects
But the Twitter employees didn't join a startup, and have compared their TC to other liquid comps offered to them. Their leases and mortgages would be based on their liquid comp, which could be cut in half overnight until the next IPO
It sucks and I wouldn't wish it on my worse enemy. It does make sense though since the mission and culture will be night and day different and would never mesh.
An agent of Elons buys 15% of the stock triggering the poison pill.
The agent declares publicly he is not an agent, has no intention of selling the stock to Elon, has no business with him, etc - Essentially avoiding being lumped with Elon in the same group.
Does Elon now get to buy 85% of Twitter at a discount?
> An agent of Elons buys 15% of the stock triggering the poison pill.... The agent declares publicly he is not an agent...
I'm guessing that would be some kind of fraud or at least a securities law violation.
It's not law therefore finding creative ways to go around that poison pill would not violate any laws.
>> I'm guessing that would be some kind of fraud or at least a securities law violation.
> It's not law therefore finding creative ways to go around that poison pill would not violate any laws.
They would if those "creative ways" where themselves violations of the law. The issue isn't subverting the poison pill, it's the lying and secret coordination.
https://www.merriam-webster.com/dictionary/fraud
> Definition of fraud
> 1a : deceit, trickery specifically : intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right was accused of credit card fraud
> 1b : an act of deceiving or misrepresenting : trick automobile insurance frauds
In your hypothetical example, the agent doesn't have to say anything.
If Larry Ellison buys 15% of Twitter as a favor to his buddy Musk, he is under no obligation to publicly state anything. All he has to do is to disclose any stake bigger than 5%, as per SEC rules.
Twitter board has no power to question Ellison on his motivation.
They can either trigger the poison pill or not.
If they try to include Musk as part of the poison pill, they'll be sued by Musk and the burden of proof will be on Twitter board to demonstrate that Ellison is in cahoots with Musk.
And when you're in front of a judge and the jury, it's a bit more complicated than "because I said so".
Then cite an opinion that found that a deception like the one originally outlined was legal, preferable one at an appellate level.
Because "have an agent do something for you and lie about it to deceive others" does not seem likely to be a sound basis for a legal scheme.
> And when you're in front of a judge and the jury, it's a bit more complicated than "because I said so".
"Can't be proven is court" is quite different than "being legal."
But an interesting hypothetical: some wealthy benevolent complete stranger who has no ties to Musk whatsoever suddenly purchases 15% in order to trigger the poison pill and allow Musk to buy a huge stake at a discount. I don’t think that would be fraud. (Though I’m really not sure? And there are probably plenty of lawyers who could make a solid argument it is...) And I’m not sure why anyone would ever waste so much money on a random act of kindness(?) for Elon Musk but billionaires have definitely done dumber things with their money just for shits & giggles.
And also it’s a silly hypothetical (even for a hypothetical) because I didn’t think it through at all: I’m pretty sure there is typically a cap on how many shares any one shareholder can buy when the pill is triggered. So it wouldn’t really be any help to Musk except that the “threat” of the poison pill would be removed and maybe some investors would be happy to cash in by quickly buying the poison pill shares and then selling to Musk.
Also, if it were triggered I think it would be a bit of a logistical nightmare and things would probably be in flux for a few days before anyone could say who owned how many shares with any certainty.
Wait, what am I thinking. I don't need to worry about the SEC... the reputational boost associated with whoever identifies shady behavior first will be huge. Everyone will be bounty-hunting this to death backwards inside out and upside down. It's Twitter and it's umpty billion dollars.
SEC enforces laws created by congress.
"Poison pill" is not a law. It's a rule created by Twitter board.
It merely says "if this happens, we'll do that".
If anything, SEC should be looking into Twitter's board authority to sell stock at half price, which clearly harms shareholders.
And one of the things SEC is supposed to do is to protect shareholders from harm, even if the harm comes from inside the house.
This means that the poison pill would not allow Elon to purchase large quantities of Twitter at a discounted price through the poison pill itself.
Edit: Missed a provision of the poison pill allowing for doubling of existing shares without shareholders needing to purchase anything. Also try to clarify that the $420 of new stock may be per existing share owned, if I'm reading these documents correctly.
Also, I admittedly missed another provision of the poison pill - the board also has the ability to exchange an unexercised right for 1 share of common stock, effectively doubling outstanding shares for eligible shareholders without them needing to make an additional purchase. This may be more
[0]: https://www.sec.gov/ix?doc=/Archives/edgar/data/1418091/0001...
The market cap stays the same (nothing about the business has changed) but suddenly there are 185 shares. So the new price per share on the open market is 1,000/185 or $5.41. So just buy the extra shares you can buy and you should be able to sell them on the open market for a profit. The only person who loses out is Musk, would now owns ~half as much of Twitter as he did before.
Anyone have a sense of what might happen?
Edit: And as best I can tell Levine has been wrong on this situation at every step…
Perhaps when it comes to the sincerity of Elon's actions, but I'm not aware of when he's been wrong when it comes to Elon's legal options.
Trust is a big part of stock value, if you don't trust the board is time to sell...
Some poison pills just give the shareholder extra shares -- it's basically a stock split except for the targeted shareholders.
In reality, this poison pill is more complicated - from Matt Levine: "The main mechanism of the pill is that if Musk or anyone else acquires more than 15% of Twitter's stock, then every other Twitter shareholder will have the right to pay $210 to acquire $420 worth of Twitter stock (at then-current market prices)."
He also points out that this is moot except in the highly unlikely event that it is triggered - in which case, someone screwed up really badly.
The offer is extended to existing shareholders.
So if you own 10 stocks you will be allowed to purchase 10 more stocks at a vastly reduced cost.
Something like that.
This way you can screw over the corporate raider without screwing over existing stock holders.
"Another, perhaps more practical provision of the pill says that the board can just exchange each right for one share of stock, for free, meaning in essence that the board can double everyone else’s number of shares of Twitter while holding Musk’s constant, without asking anyone to put in more money." (From a recent Money Stuff.)
It also gives reasons why poison pills were allowed by the Delaware Supreme Court (and not the SEC).
This seems to be the root problem, and it can happen in other scenarios when a coalition controls 51% of the shares. The law needs to protect the minority shareholders.
This poison pill “solution” is just theft.
This is effectively the same as giving away shares.
First off, even if buying the shares at the reduced rate is highly profitable, you do need the cash to buy them. With the 50% that are floating around here that's a significant amount of cash.
Furthermore, with the dilution that's happening the stock price would also drop so while you gain on the reduced shares, you loose on money on your old shares unless Elon keeps buying.
I just don't see that it's the same as giving away shares for free (which is just adding dilution without additional capital costs for the existing shareholder). Feels to me like an all parties lose situation if it's triggered.
"Another, perhaps more practical provision of the pill says that the board can just exchange each right for one share of stock, for free, meaning in essence that the board can double everyone else’s number of shares of Twitter while holding Musk’s constant, without asking anyone to put in more money." (From a recent Money Stuff.)
"Musk can launch a tender offer to buy all of Twitter's stock for $54.20 in cash. (Or, of course, some higher number.) The tender offer is a public, binding document filed with the SEC, open to all shareholders, and it will be full of disclosures about his plans and, in particular, his financing. Shareholders will be able to read it and see if he has the money. If it looks like he does, then they will be able to decide if $54.20 is a good enough price. If they think it is, they will be able to tender into his offer, submitting their shares for purchase. He won’t be able to buy them, though, because of the poison pill; the tender offer will be contingent on getting rid of the pill. But if like 90% of shareholders tender into his offer, then that is an important public-relations victory; he can go to the board and say “your shareholders want this deal, let them take it.” And then the board might agree and get rid of the pill, and then the tender offer can close and he can buy the shares."
But if Musk is successful taking over twitter, my intent is to get a twitter account and start posting the most grotesque and offensive things to see if Musk really is a free speech absolutist. My suspicion is that he is mostly interested in his free speech, not mine.
"Elon Musk says Tesla hopes to produce a robotaxi with no steering wheel or pedals in 2024"
https://www.businessinsider.com/elon-musk-tesla-build-robota...
I find the medium to not lead to productive dialog. The only interesting posts I've read are ones where someone essentially ignores the format and writes a long form comment over ten serial tweets. Limiting people to 140 characters (or 2x that now) leads to people spitting out punchy comments that lack any nuance. Rather than a dialog you get either echo chamber if the participants are in agreement, or if the participants are in opposition, a series of tweets attempting to land a body blow on the other.
From what I understand, a large reason the US switched from the Articles of Confederation to the US Constitution was to help resolve inter-state conflict. I wonder if we can resolve inter-national conflict with our current confederation of nations.
AKA “The South” in the US civil war.
Edit: Yup, as pointed out by replies, I got my documents backwards. Sorry!
> The Articles of Confederation and Perpetual Union was an agreement among the 13 original states of the United States of America that served as its first frame of government. It was approved after much debate (between July 1776 and November 1777) by the Second Continental Congress on November 15, 1777, and sent to the states for ratification. The Articles of Confederation came into force on March 1, 1781, after ratification by all the states.
https://en.m.wikipedia.org/wiki/Articles_of_Confederation
Edit: I think you're thinking of the Constitution of the Confederate States: https://en.m.wikipedia.org/wiki/Constitution_of_the_Confeder...
Some people think it's fair game to retaliate gainst your own employees because there is no free speech at a company, I would counter that it's a very narrow margin for someone who declared themselve "free speech absolutist" and didn't implement it in their own kingdom.
Twitter is not Tesla or SpaceX neither are they considered the same (at all). To expect him to treat everything the same across the board is a disingenuou unrealistic expectation.
"Starlink has been told by some governments (not Ukraine) to block Russian news sources. We will not do so unless at gunpoint.
Sorry to be a free speech absolutist."I know I can read minds.
I don't get why people are so worked up about this. If you see Twitter, as Elon and millions of other people do, as the "public digital town hall", it is not unreasonable to verify people's identities and let them comment whatever they want so long it is legal.
It does not mean that you or anyone have to subscribe or listen to their crap.
If you don't see it that way, do people really not understand how others see that as gatekeeping, controlling, or dangerous? What is the purpose of Twitter than to you - basically television? To tune in and tune out?
Then, open source the algorithms. Do the same people really not want to know why Twitter chose to show you X information? Wild.
Protesting a cause at an innocent persons expense is immature.
It also can escalate into real violence.
Here are some sample tweets I might want to post.
"I'm not saying Elon has killed anyone, but he owns a lot of property where bodies could be buried. Why aren't the authorities looking into this?"
"Fact: Tesla cars are killing more people than any other cause." Yes, it it is patently false, and that is the point.
"People are saying that Elon is forcing his numerous lovers to get abortions. Does anyone know if this is true?" Hey, I'm just asking questions.
I believe twitter accounts allow posting a very short description. I'd probably put something like "Testing the limits of twitter's free speech."
> People are saying that Elon is forcing his numerous lovers to get abortions.
Yes, this is harmful to Elon’s “lovers” and at their expense (not yours, not his).
Yes, this is deranged.
Yes, people can support your right to say this while thinking you are really immature, thoughtless, and not even remotely creative.
I understand you disagree with me. Call me deranged is over the top. Calling me immature and thoughtless and not even remotely creative is also a broadside that you can't possibly know. How about we talk about ideas rather than you psychoanalyzing me?
You have taken great offense that I hypothetically might say something untrue on twitter. Have you spent this much energy combating the actual harmful BS that is actually on twitter? Have you written more about my comment or about Elon Musk calling that scuba diver who helped rescue those kids a pedophile?
Although groups like qanon tend to sway naive users to extremism, it would be unfair to silence different thoughts just because it "may" lead to that.
Fight bad ideas with better ones.
I think it's more deranged to see such a test as abnormal.
(Also grotesque does not necessarily mean offensive, and you can limit the scope of the content's exposure)
> (Also grotesque does not necessarily mean offensive, and you can limit the scope of the content's exposure)
OP comment:
> start posting the most grotesque and offensive things
Also, testing if a billionaire (who has offended many people on Twitter) is lying is not deranged behavior, which is the point you keep avoiding.
So far you are railing on imagining the worst possible implementation of my idea. I won't speculate why you are that way.
I also think (a) nobody would notice my twitter account, (b) they'd probably block me, which would make my point, and (c) the people who did read my stream while it was active would clearly understand the context of my statements.
Think of it like The Satanic Temple. It exists not to glorify Satan but to test whether laws really are favoring some religions over others, in contradiction to the constitution.
> Right, it's not limited to being offensive, and even if it were, you can limit exposure.
What do you mean by limit exposure? How would the GP limit exposure of their grotesque and offensive tweets? And even if they did, wouldn't that defeat the purpose of their test? They are trying to increase exposure and see if Musk will limit exposure.
The GP is stating they will purposely offend people to test their suspicions of someone. They are willing to hurt (with words) innocent people to do this. You're calling this normal behavior. So if Musk takes over, it's okay to start calling black people the n word on Twitter to test Musk? I think that qualifies as "most offensive." And to call this testing behavior abnormal is deranged itself according to your words?
And some of your justifications are it's okay to do because Musk is the world's wealthiest individual and he's already offended others?
> It's a test of the word and motivation of not just a billionaire, but one of the world's wealthiest individuals - one who has publicly insulted and offended many people already.
as for open sourcing the algorithms, I consider myself extremely pro-open source (though ofc you're free to draw your own conclusions), but isn't it clear that that might simply allow spammers to game them as efficiently as possible (and to that end, isn't spam also free speech)? one idea that seems reasonable that I've heard proposed is an open marketplace of algorithms that one can choose from (open source and otherwise)
I think we're all about to witness the tragedy of the commons in real time if Musk buys twitter. Because there are literally thousands of people in college towns alone all across the US who will descend on Twitter and do this. Probably millions outside of college towns who will do the same. it's too bad.
My bet is we'll end up filing this under "This is why we can't have nice things".
>mine
You enjoy grotesque and offensive things?
I think what Musk wants to see is the Overton Window opened up more than it is now, and that's not a bad thing.
There will be moderation.
Musk talked about the need to improve Twitter's handling of spam, bots and scammers.
So clearly if he owns Twitter he will direct the team to eliminate spam, bots and scammers as much as possible.
If you get classified as those, you'll be booted off the island.
And given that your stated purpose is malicious, I say that you should be.
Although I'm not suggesting to trust a character like Musk purely on his words, it's at least interesting to be informed of plans he openly expressed.
First, he clearly expressed there's no economic motive. Which makes sense as Twitter is a terrible investment. A pessimistic interpretation is that it's about prestige, a positive one is that he genuinely wants to improve Twitter, whatever that means. Personally, I think it's a little of both, they are not mutually exclusive.
Regarding free speech, he stated that the first goal was to understand current "censorship" mechanisms and policy, and to make them more transparent. It's hard to disagree with this one no matter your leaning.
Further, he intends to be fully compliant with free speech laws, in every relevant country. There isn't much choice in this matter, but still.
As for what any new policy would look like, he stated that in the case of a grey zone, not censoring it is preferential. The grey zone is not defined, but in any case it means less censorship.
As for any political direction, he stated to have none. His ideal would be for both extreme ends to be equally angry, so in balance. This suggests that it's not some play to revenge-censor the far left or steer things in any explicit political direction.
Other than this, he has plans to improve/cleanup the broken parts of Twitter, like bots.
Like I said, you can take all of these public statements with a grain of salt, and you should. I personally give them the benefit of the doubt, as pretty much all of the "worst case" interpretations make no sense. It's not an economic play. It's not a play to only allow speech that benefits him directly as what possible Twitter speech would benefit him directly, given the position he's already in? He's also not turning it into a 40 billion dollar 4chan, there's just no rational basis for such pessimistic takes.
Perhaps a simpler take is that Twitter is so broken, dysfunctional and toxic that he can't possible make it much worse. And if he still does, let's hope it fully sinks. The world would be improved.
b) We can be pessimistic about Musk's intention because of his past behaviour. At Tesla/SpaceX he has routinely suppressed any free speech and unionism. With Jack Sweeney he tried to buy his silence and he has on a number of occasions filed defamation lawsuits over things people have said. He is not altruistic but instead uses his power to shift the world to his benefit.
The way I see it, his plays are "larger than life" plays. It's attaching his name and legacy to solutions to giant, seemingly unsolvable problems. Which so far seem to be problems that actually help humanity forward. Most of them anyway.
If so, one can wonder if it matters whether it's driven by a sense of ego or truly and selflessly wanting to help humanity forward, or a bit of both?
One type of criticism I fully agree with, or at least acknowledge. His methods. The goal may be altruistic, but his methods surely are not. He's ruthless in achieving these goals and has no mercy towards anybody standing in his way.
It's hard to say whether the end justify the means, and it may not even be fully purposeful. He's autistic and had a difficult upbringing. Which doesn't have to be an excuse for everything, but it's something to take into account to paint a full picture. Which is a complex one, and not a simplistic Disney villain stereotype.
I ultimately do agree that he shifts the world to benefit him, but perhaps not in the way you mean it. To benefit him to enable him to achieve the goals, no matter what.
I wonder how many will accept the offer - about 30% of ownership have said they're not interested at that price, if he let a few large holders stay on it could be successful - but this would be a kick in the teeth for smaller investors and his retail fans.
Why would Musk need more than 51% of voting shares for control of the board?
> Most years they lose money
Absolutely grotesque.
whenever something like this happens you have to ask yourself why now and what’s in it for Musk (let’s be real: nobody spends this much without an agenda). My fear is that Musk’s endgame is to reinstate a specific account that was banned after some specific events around a specific election. If this is what’s happening he can frack off.
ask yourself: why were those accounts banned?
what’s the ideology that’s being “suppressed”?
+5 for mental gymnastics
Money. If your advertisers flee, meeting payroll gets exponentially more difficult.
Twitter is/was a ban happy shithole.
It is absolutely trivial to get banned on Twitter. My favorite example is someone I know getting banned for posting pitbull fatality statistics. They were banned for “racism”. Against dogs.
Twitter needs a top to bottom purge.
The replies were full of people saying things like "this is exactly like how white people post statistics to say black people commit more crime! Report this person for racism!"
It was charts of dog fatalities per year broken down by breed.
Bringing back the accounts that spew stuff which pushes advertisers away will not make Twitter more financially successful than they are today.
Hell, maybe that's his intent. What if it turns out that rather than being a free speech absolutist, he thinks social media is destroying the world and the best way to solve that is to crush it out of existence, starting with Twitter.
That wouldn't work, of course, but it would be entertaining.
what experience does musk have to make twitter better and why is this expensive unique so that twitter itself cannot make the changes?
twitter back in the day was awesome until they turned hostile to the 3rd party developers.
Elon musk - smart and crazy
This is all you or Morgan Stanley need to know, besides Elon claiming he doesn't care if the venture makes money.
For me, this is the thing that bothers me the most: if he thinks it is the closest we have to a public square, why does he think that the richest private individual in the world should decide how it is run?
It seems he's saying "the oligarchy is not running this well so we should make it a dictatorship, not a democracy," which is in his right to say or believe, I just wonder how much we have lost faith in democracy if we agree.
Isn't the fact that twitter is NOT part of our democracy the crying call of the left? "It's not censorship because it's a private company and they can do what they want (as long as they only censor anything I don't agree with)!"
Oh NO, Elon might make twitter a free speech platform where differing views can be expressed!
I don't claim that the current oligarchy is doing it well, I don't claim that a Musk monarchy would not do it better, and I don't claim that even a democratic structure would do it well.
I was merely trying to point out the different governance structures and question our collective faith in democratic structures.
Allow me to steelman this position a bit for you though. I think the root, gut feel that many Americans have is that they are sick of being pushed around and mismanaged by ineffective, small-minded, out-of-touch bureaucrats. This affliction seems to affect every aspect of our lives. If you have a problem with Comcast, you have to go through a robo call center that makes it physically impossible to actually talk to the people that are authoring your pain. You can't get mad at the person on the phone, because they can rightly say that it's not their fault your bill doubled. And yet, what's left unsaid is that things are specifically arranged this way on purpose.
The social architecture of our society is so "democratic" that there is no responsibility, no human spirit, no .. humanity in the way we deal with things. You can bet that Twitters internals follow this rule, and I'm sure when they talk about the failings they've had as a company, the blame is blandly smeared around. As a democracy fades into a bureaucracy, politics and corporate culture just descends into tee-totalling, cover-your-ass box checking that you're doing everything "by the book". It is the soulless HR department in place of actual values and kinship.
So you might see this newfound lack of faith in democratic structures less as a vote against democracy and more like a vote _for_ humanity. If you put Musk in charge, one thing you know is that there is a dude - a fully human dude, foibles and negative qualities included - who is running things. Looked at from this perspective, you can almost even get your head around what it would be like voting for trump. Okay, maybe not, but maybe you can get a few steps closer.
I appreciate you taking it further and I think I can relate. The frustration with things being too ineffective and the drive to have a human responsible for something. I believe monarchies can be highly efficient, as many other top-down hierarchies. I think the challenge lies in that while one can efficiently help, one can also efficiently harm.
So, yeah, a part of me loves that a human could come in and make it more structured, more "the buck stops here" (ironically from the US President, the leader of a democratic republic), and I also worry about what happens when that person goes in a direction we don't like or a direction that harms or kills us. May seem like an exaggeration for a social media company, however, many genocides have been fueled by language through mass media.
> The social architecture of our society is so "democratic" that there is no responsibility, no human spirit, no .. humanity in the way we deal with things.
This is why I actually believe more in the idea of representative democracy than direct democracy. Yes, not as much responsibility as a single owner, but allocated responsibility to a few while being owned by many.
Lol, if you think the left is genuinely defending the rights of private corporations, I don't think you know much about the left...
Probably the defining ideological organizing principle of the left is social equality, which is the exact opposite organizing principle of corporations, that being profit over all. Corporations are organized as dictatorships; leftists prefer them to be organized as democracies of, by, and for workers. Corporations censor the free speech of their workers, restricting what they say and how they can organize themselves; leftists want to take away the power corporations have to do this.
Insofar you are hearing anyone you perceive to be on the left supporting the rights of corporations like twitter to do what they want, perhaps consider they are throwing the argument in the face of corporate friendly Democrats and Republicans who have created this situation themselves by granting corporations such power over our lives, and are now only complaining when it hurts them politically.
I'm waiting for the day when that's tackled honestly by those groups, because right now it seems to me that politicians want to force specific companies like Twitter to stop hurting them politically while still maintaining corporate power and the inflow of corporate cash into their reelection campaigns. Thy want to call Twitter a "town square" and a "public good", and carve out exceptions that would specifically limit its power while still maintaining the power of the corporations they prefer to wield it. Meanwhile they will argue vociferously that healthcare, education, housing, even roads and broadband aren't public goods and must be kept privatized or turned into private ventures.
Under our current system (not created by leftists), corporations are people too and have more rights and power than natural humans. Leftists will stop pointing out that corporations have this power as soon everyone else stops arguing that corporations should have this power.
This will elevate the level of discussion to be more like the highly praised philosophy forum known as 4chan.
I'm sure all the users will appreciate it and not leave immediately.
But it's not good enough, we must be forced to listen to hear how the COVID vaccine is a mind control weapon and why we must fight (((globalists))).
Good. Time to break it up and enforce fair rules.
the reason twitter works and is successful is that you have people from all backgrounds and walks of life. people that get banned don't follow the rules that Twitter has (if the rules are fair, etc, is another discussion, but everyone has to follow the rules)
Don't you recognize that this is exactly what happens?
They do end up going to their own corners of the web, and idealogical-activists refuse to leave them alone and try and shut them down wherever they go. Look at how many times Gab, Parler, and other more free speech sites have been shut down.
Given Elon's predilection for trolling it's odd he doesn't realize those people who are banned don't want to build anything, they just want to watch the world burn.
it's in the direction of "I don't want Musk to mess with Twitter". I personally cannot do anything about it but watch and voice concern, but if enough people see the concern I am voicing maybe this will lead to a better outcome. who knows?
1. Twitter is totally open free speech 2. This scares people away and user counts drop 3. Twitter censors and users come back
But this didn't happen. Twitter and other, at the time, free speech platforms like Reddit were experiencing rapid user growth throughout their free speech phases. The "this will scare away users" justification for censorship is used entirely as an ex post facto justification.
There's a reason why none of the other purported full free speech platforms ever taking off and it's because they end up so odious that advertisers never go near them and the userbase stalls out. Personally I think most of the people that believe full freedom of speech is possible have never been a moderator of even a small social media platform. If you have two users and one of them is harassing, stalking etc another user you eventually have to make a decision which of the two you want to keep around, and it inevitably involves you censoring one of them.
It's not hard to defeat bad ideas with good ideas. Or you can just ignore it by turning off the channel. That's always an option.
That's a load of crap. You cannot debate with conspiracy theorists. Debates only work when both sides are acting in good faith.
we don’t have unlimited time an unlimited attention spans. we also deal with uneducated, easily manipulated people that will just discard anything that does not match their world view and just amplify the bs.
Sending Flat Earthers off to their own dark corner is how they become entrenched. Leave them in the public square, in broad daylight, so they are exposed to evidence to the contrary. That's how you defeat bad ideas over time.
We didn't need to censor anyone to get here.
On longer timescales, the truth wins, because it is real, and everything else is not. False beliefs are persistent but simply can't compete with reality.
a lot of people, on the internet, are not open to this and will chose the bs over any fact, argument, reason.
I'll pass. And I'm sure many others will too.
how many times would you try to debate that person before deciding it’s a waste if time?
Free speech is measured by the tolerance for speech that you hate.
Of course, he may just do the opposite, and start banning people on the left. That would align more closely with how he runs the companies he is currently in control of.
Without an engagement-maximizing algorithm that promotes the most divisive content, those accounts would just be preaching to their own choirs. Meanwhile other people could pop in and see just how unhinged and ridiculous they are.
Maximizing engagement means maximizing dishonest trolling, hate, fear, controversy for the sake of controversy, and catchy tabloid bullshit. The most engaging content is basically an adversarial attack on higher human cognition. It typically works by bypassing the rational mind and shooting for the amygdala.
Make it a simple timeline again. Nix recommendations in favor of search. Make it just a forum, not an inherently biased Skinner box that sucks out peoples' brains.
I'd support that regardless of who he lets back on the platform, because algorithmic social media is the real problem. Algorithmic social media is what got Donald Trump into the presidency, among many other things.
why spend time actually educating people and giving them the tool of critical thinking when you can create a cesspool that enables and amplifies xenophobia, racism, sexism, you name it.
why call out certain behaviors that are horrendous when you can normalize them and pretend this is part of the normal public forum?
Person A tells you about a new discovery at NASA. Person B tells you the Earth is flat and bombards you with "irrefutable" proof. Which maximizes engagement?
I really do think engagement maximizing algorithms explain much (but not all) of our collective descent into insanity since about 2010-2012 when they became popular.
Why would he pay 50 billion for that? What does he gain from it? Goodwill? Leverage on Trump in case the latter becomes President again?
the gov already pumped billions of dollars in tesla and space x through different programs. if that pumping increases that would be great, right?
https://twitter.com/pacday/status/985314558775410688/photo/1
I’m joking, but I’m kind of not… We will see who is actually behind the package, but MUFG and friends have a habit of financing foreigners’ adventures while keeping Japanese companies under-capitalized and starving. (For those not aware, MUFG owns a large part of Morgan Stanley, hence the photo above.)
Clearly, the cabal is not interested in losing control of the public narrative.
The issue is indeed always to determine whether a course of action is knowingly not in the interests of the shareholders.
Fiduciary duty is very much a thing. The Twitter board with such a tiny amount of equity may incur risk from "honest services fraud," if they block shareholders from recieving the material and obvious value of the offer.
They can’t argue that because it would be completely irrelevant to current shareholders.
They can argue that the long term value is higher than Musk's offer.
Board goes against Musk, shareholders may sleep.
Board goes against Musk and the founder, shareholders may awake.
It's also very likely that if Musk takes TWTR private he then privately sells portions of it to people who would like to be in on it with him. SpaceX is private, for example.
The key is that TSLA is not buying TWTR (which stranger things have happened), it's Musk.
Again, correct me if I'm wrong, but it sounds like he's financing this prospective purchase of Twitter with loans that are backed in no small part by his stored equity in Tesla. He might not be "giving up" shares, but he's effectively introduced an interested party with the ability to seize those shares to recover any losses.
That's the part that would concern me as a Tesla shareholder.
Citizenship or Place of Organization: USA
Does anyone know if he still has both of these citizenships? If yes, I am surprised that he is not required to declare them on this form. Maybe SEC does not care about other passports, if already a US citizen.
One idea: Maybe he renounced the others so that he can run a rocket company in the US. As I understand, Space X is crazy strict about security requirements, and many of those are dictated by the US Federal gov't.
For example, in New York City, I knew many Jewish people that were native born US citizens, but also had an Israeli passport. It made it easier to visit Israel (much lower security requirements), and it was an important cultural link for them.
Makes no mention of giving up citizenship or passport-holding, just allegiance.
My understanding is that they can't really enforce this. You can still hold multiple citizenships even if its against the rules.
Ref: https://en.wikipedia.org/wiki/Japanese_nationality_law#Dual_...
The question of whose voices should be allowed on Twitter seems to me to be missing the civilizational problem. It's akin to asking whether only people who graduated from an accredited conservatory of music should be allowed to play in the kazoo section. The answer might seem complicated until you realize that there shouldn't be a kazoo section in the first place. They sound like 8th graders, and adding some terrible musicians isn't moving the dial on that. Find a new instrument.
I know that Musk actually likes Twitter so this would never happen, but wouldn't it be amazing if he bought the company, laid off all the staff with severance packages, and shut the lights off? Then we could let the healing begin...
I can't stand the man, and I dislike the idea of him owning Twitter. Who knows what's going to happen, whether he'll succeed or not, Maybe he'll put his money where his mouth is re censorship, I don't know, but that there will be an ideological changing of the guard is inevitable, imo. What then? Do we really want these platforms to have so much unaccountable control over the discourse?
Funny how this is suddenly a problem when Elon tries to buy. I agree in principle, but the bias on display is overwhelming.
Looking at the amount of money that is spent on nation-level campaigning (for a term length of ~4 years) the sum short would be minuscule when compared to near-global reach to be gained, so maybe the total of folks chipping in one way or another weights in much more p.a. than what currently is "on the table".
> This leaves Musk two main options. One is to negotiate with Twitter’s board and try to strike a friendly deal. This might be hard because the board probably wants more money than Musk is willing to pay, and also because there seem to be strategic and personal disagreements between Musk and the board that might make friendly negotiations difficult. “I am not playing the back-and-forth game,” Musk said in his initial proposal; “I have moved straight to the end.” That’s an annoying way to start negotiations.
> His other option is to pressure the board into dropping the pill, and the classic way to do that is with a tender offer plus a proxy fight
>I guess Musk has a third option, which is to do nothing and tweet mean things about Twitter’s board. Honestly a totally respectable option; $40 billion is a lot of money, owning Twitter seems exhausting, and Musk does have several other full-time jobs. A fourth option would be “buy a lot of stock, trigger the poison pill, and unleash absolute mayhem,” which is not totally impossible given that it is Elon Musk.
Twitter is where people go for posting stuff when sitting on a toilet. Even though it may seem like it is where all the newsmakers are at this point in history, imho it doesn't have much of a future.
Everyone else is better off posting Tiktok videos to communicate.
Tiktok (or something similar) is the future of social media where you can see not only what people are literally saying but also how they are saying it... tone of voice, facial expressions (if you wish to reveal it). Video conveys a lot more information in a short time than a block of text ever can... because a block of text has to be given emotional charge, even a hint of intent by the reader... which makes it open to interpretation in many many ways, most of which can be very misleading.
Younger generation is not going back to text based social media.
https://www.youtube.com/watch?v=vzY_jIJaZwk
Hard to really know the facts, but things may not be as they appear. In this case however, he has filed the SEC docs to verify that funding is secured.
https://www.bloomberg.com/opinion/articles/2022-04-20/elon-c...
Does anyone know what the hell this means?
Is this one of those annoying things in the finance world where, back in 1930, this would have been a meaningful number, but nearly a century later, everything is structured completely differently, there's a completely different set of numbers that are meaningful, but we have to keep dragging this legacy set of meaningless numbers around for legal reasons?
I know inflation is high but...
When will people get tired of his stale shitposts and shenanigans?!
Get a hobby, Elon and seriously consider cutting on Twitter usage, it's frying your brain.
https://en.wikipedia.org/wiki/Top_Secret_America
Is Musk following in Besos steps, or will he really open source the ranking algoritm and increase the character count of posts to paragraph-scale (512-1024 characters)? Time will tell I suppose.
Because it was cheap and he wants to support journalism. Seems a lot more likely than your conspiracy theory.
Sure, WaPa does fantastic journalism- it's obvious that they must be supported for their lengthy history of great pieces.
Trumps fall in mainstream impact has proved this to not be the case. It used to be we would hear something crazy from him on a daily basis. If the ex president can't make his own website and maintain relevancy, I doubt musk can either
Like he does his existing customers or employees?
I can never understand how some people still have such unbridled optimism about what Elon Musk will do next, given how ample the evidence is that he won't. He has quite a track record to base predictions on.