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Comment by slg | Hacker News Reader

But Tesla stock did drop after the announcement of the deal. I think that is the real reasoning behind him quickly getting cold feet. He probably thought Twitter would be a fun side project, but the backlash from people in regards to Tesla, SpaceX, and just the general public meant it would be more costly both to his reputation and financially beyond just the sticker price. That took the fun out of it so he has been looking for ways to escape the deal ever since.

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The question isn't really whether it dropped or not but whether the perception was that it would have dropped more without that fig leaf.

This isn’t the first time he has sold Tesla shares. He sold billions of dollars worth last year too. I’m not sure the exact dates to do the math, but did those sales cause a immediate drop of over 10% like the Twitter announcement?

That's not the right question, the question is the perception of the difference between selling $44B of stock outright or selling it with the goal of buying Twitter.

What actually happened isn't relevant. What is relevant is whether he may have thought it would work better. Tricky to prove.

We agree that he didn’t suspect the backlash from buying Twitter. I think our disagreement is just that you think he expected a large backlash from selling Tesla shares and I’m not sure history really suggests that was something to be concerned about.

he wasn't (or isn't) aiming to sell the stock, he was/is aiming to finance the purchase using his Tesla stock as security. So this line of argument... Doesn't really make sense?

This is all publicly available. Due to leverage, he faced ruin if Tesla fell below X (whatever X is) if he funded it all himself. So he opened his side of the deal up to other people, and allowed other large shareholders to come inside his tent - which reduced his exposure. Then the market dropped 15%.

Matt Levine has an excellent series of newsletters covering it.

But he has been saying Tesla was way over valued for over a year…

> but the backlash from people in regards to Tesla, SpaceX, and just the general public

There's no way he didn't foresee this.

It would be shocking if he is lacking in self-awareness to that extent.

> It would be shocking if he is lacking in self-awareness to that extent.

'Ol Musky missing self-awareness? Surely, you jest Mr. Spock!

There's a lot of things Elon is not, but he definitely is a smart business man and he can manage hype.

His present situation with a multi-billion dollar agreement he entered based on hype and is now very desperate to exit seems to suggest his hype management skills have room for improvement.

He typically creates massive hype, well over what he could possibly deliver, not sure I've ever seen him temper hype.

Just remember the launch of Tesla auto-pilot, where he was promising full self driving within a year or two, so good that you would let your car work as a taxi while you don't need it and it would become a passive stream of income so great you would see your investment back in around a year! He actually said "our goal is to make Ilit financially irresponsible to buy any other car". This is not a man who "manages hype".

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