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The sad piece of karma in all of this is that Musk tweeted in an effort to destroy the shorts. His tweet turned out to: - give the shorts a big dip in his stock, - an investigation by the SEC - an investigation by the DOJ - the backing off of a deep pocketed investor in the Saudis - Him potentially being personally liable, which would mean having to step away from SpaceX and Tesla if he was found guilty of fraud. Thi…
Please define shorts. Google was unable to figure it out.
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The "lied on twitter" part is now clear. He said he had funding secured for a buyout at $420 which he has now basically admitted was not true. The "cause financial harm to people shorting Tesla stock" is a bit of speculation but it seems basically obvious to all observers.
It's not a fact that he lied. He believed he had funding and explained the rational behind that. He wasn't making it up. Intent matters. Certainly, it was a reckless thing to say and a bad idea given that it wasn't 100% closed. "Secured" was the wrong word to use, no doubt. Elon: "I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of…
I only recently got back on twitter. I do not use my likeness or use it for any other reason except to find out about things I consume(stand up comedy, concerts, etc). Twitter is a great platform for that. Its an awful platform for speaking your mind when you run a company(or the country)
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The "lied on twitter" part is now clear. He said he had funding secured for a buyout at $420 which he has now basically admitted was not true. The "cause financial harm to people shorting Tesla stock" is a bit of speculation but it seems basically obvious to all observers.
It's not a fact that he lied. He believed he had funding and explained the rational behind that. He wasn't making it up. Intent matters. Certainly, it was a reckless thing to say and a bad idea given that it wasn't 100% closed. "Secured" was the wrong word to use, no doubt. Elon: "I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of…
Elon is a smart man. He knows this does not mean that funding has been secured. "Could be" is not a "secure" state.
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Shorts drive the price down, making it more expensive for the company to borrow from the market by selling stock. They have to sell more shares to receive a similar amount.
I obviously lack a piece of the puzzle here, let me see if I get this right: a short means borrowing stock, selling it then rebuying it later (betting that the price would have fallen in order to turn a profit) before giving it back to its original owner. I suppose if everybody shorts at the same time the huge amount of stock being sold could drive the price momentarily down, but then again the opposite happens when…
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It’s important to note that Elon screwed over the “longs” (people holding TSLA stock) too, not just the shorts. Many people and funds bought more TSLA stock in the $350’s range on the assumption that of course the company could/would go private at $420/share. After all, hadn’t the CEO just said so?
I was reading r/TeslaMotors that day and a long made the astute observation that shorting the stock after Musk's announcement when it hit around $380 was the most logical thing to do, because at most you'd be out 10% if Musk were telling the truth. If I had a trading account I think I might have gone for that.
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I was reading r/TeslaMotors that day and a long made the astute observation that shorting the stock after Musk's announcement when it hit around $380 was the most logical thing to do, because at most you'd be out 10% if Musk were telling the truth. If I had a trading account I think I might have gone for that.
Max loss being 10% is absolutely not accurate at all in that scenario. Taking the company private would still be up to a shareholder vote and shareholders could determine that the price offered was not sufficient. In that case, there are a lot of ways the stock could trade above the takeout price.
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It's not a fact that he lied. He believed he had funding and explained the rational behind that. He wasn't making it up. Intent matters. Certainly, it was a reckless thing to say and a bad idea given that it wasn't 100% closed. "Secured" was the wrong word to use, no doubt. Elon: "I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of…
Intent does not matter. If Musk got up on Twitter and announced "I have secured orders for fifty million cars at $50000 each" because he was drunk at 8am, that would not be excusable either.
Another day, another excited slam piece headline against Tesla. Tesla's Nov 7 Earning Report must be good... In all seriousness, no idea what Elon was thinking with that Tweet. Gut says, long term Tesla will be fine and little will to come of this investigation.
the forward guidance is gonna suuuuuck
"The risk factors have been updated to include that our CEO is going to be arrested, the remaining executive is running for the hills with substantial severance packages and we will expend many resources to maintain confidence and acquire a new executive team"
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A criminal investigation being opened is literally part of due process.
The big announcement is what OP is referring to.
There is simply no other way, the only reason this is a big announcement is because Elon is very active on social media.