Tesla Faces U.S. Criminal Probe Over Musk Statements • Hacker News Board

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#71

Post by whatok » Tue, Sep 18, 2018, 4:29 PM UTC

danso wrote: post #57

whatok wrote: post #56

Earlier quoted context omitted.

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.

Isn't it possible to set the short order at a max limit to cut your losses? (this shows how little I know about having a trading account)

This might help: https://www.investopedia.com/articles/active-trading/091813/...

The problem with stops is that you run the risk of the price gapping up or down and your stop getting filled at a much different price than expected.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#72

Post by ProAm » Tue, Sep 18, 2018, 4:29 PM UTC

chollida1 wrote: post #5

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…

I think he's out at the CEO of Tesla soon anyways. Regardless of this mess.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#73

Post by prolikewh0a » Tue, Sep 18, 2018, 4:29 PM UTC

thedaemon wrote: post #35

chollida1 wrote: post #5

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.

https://www.investopedia.com/terms/s/shortselling.asp

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#74

Post by aslkdjaslkdj1 » Tue, Sep 18, 2018, 4:30 PM UTC

beaconstudios wrote: post #46

chooseaname wrote: post #28

Earlier quoted context omitted.

So, anyone can get away with a crime if they're overstressed? or just Elon? > His idea of "secured" is simply different from the SEC definition ... He is the CEO. He's not allowed to have a different definition. Words mean things. That's how we communicate.

> So, anyone can get away with a crime if they're overstressed? Are you putting words in my mouth on purpose? I'm not arguing that he shouldn't be investigated. I'm arguing that "trying to screw over short sellers" is not the only and "obvious" reason why he could have made the tweet.

He then went and taunted short sellers on Twitter when the stock went up in response to his tweet.

Also I don't believe his intent matter for criminal liability in market manipulation.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#75

Post by staplers » Tue, Sep 18, 2018, 4:31 PM UTC

Asparagirl wrote: post #38

chollida1 wrote: post #5

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…

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?

Longs are not "people holding stock". A long is purchased on borrowed capital paid back with interest. It is a much riskier play.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#76

Post by soohyung » Tue, Sep 18, 2018, 4:31 PM UTC

thedaemon wrote: post #35

chollida1 wrote: post #5

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.

A short, or short position, is selling first and then buying later. The trader's expectation is that the price will drop; the price they sell at is higher than the price they buy it at later. The difference between the sale price and the buy price produces a profit or loss. [1]

[1] https://www.investopedia.com/terms/s/short.asp

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#77

Post by _Codemonkeyism » Tue, Sep 18, 2018, 4:31 PM UTC

S_A_P wrote: post #53

Sometimes its possible to care so much that you lose sight of what is important. This happened to Elon. I think this will be a case study someday about CEO ethics. I found it very interesting that when he was on the Joe Rogan podcast he had so much to say about social media, and none of it was complementary. How he did not see the dichotomy of his twitter use and this situation strikes me as humorous. I feel like Elo…

"I'm using social media the right way, the others are doing it wrong and I wish they'd go away". Always the same line of thinking.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#78

Post by thomaskcr » Tue, Sep 18, 2018, 4:31 PM UTC

chollida1 wrote: post #5

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…

I opened my first actual short position that day (instead of just buying puts). He literally set an upper limit on how much money you could lose and I just felt really confident he was full of crap.

Got out of the position at a bit under $310 so left a lot on the table but was happy. He literally handed people considering opening a short position on the stock a gift.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#79

Post by MichaelApproved » Tue, Sep 18, 2018, 4:32 PM UTC

danso wrote: post #57

whatok wrote: post #56

Earlier quoted context omitted.

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.

Isn't it possible to set the short order at a max limit to cut your losses? (this shows how little I know about having a trading account)

The only reliable way to limit losses would be using options.

Re: Tesla Faces U.S. Criminal Probe Over Musk Statements

#80

Post by Latteland » Tue, Sep 18, 2018, 4:34 PM UTC

This time the shorts really have him. Or do they?

It turned out Tesla wasn't killed by not being able to make the model 3 at all, it wasn't on being able to make the model s in larger volumes, it wasn't because there was no demand, that there would be no demand after various incentives around the world went down (still some left in the us, also available to all other car companies by the way), it wasn't because they couldn't make the model 3 in volume, it wasn't because they'd all catch on fire and burn up in accidents, it wasn't because the over-promised-over-named autopilot was dangerous and would kill people, it wasn't because the leaf, the volt, the bolt, the i3, the i8, and continually forthcoming cars from audi, porsche, ford, mercedes, bmw killed them. It wasn't because there was a secret sec investigation was preventing them from refinancing, it wasn't because they have just lied all this time about selling the cars for less than manufacturing cost (separate from their enormous money spent on infrastructure), it wasn't because the batteries would run down and not survive heat, cold, regular driving, daily driving, supercharging.

It was damn stupid for him to make that twitter comment.