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Tesla Faces U.S. Criminal Probe Over Musk Statements

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

#261

Post by jkqwzsoo »

kitebox wrote: post #156
abalone wrote: post #131

Earlier quoted context omitted.

> He clearly wanted to pump up the stock price and screw short sellers (he threw lots of indicators in the public space), and his statement was clearly and knowingly false. There was no secured funding. No this is not textbook at all. See previous citation from the SEC re: intentionality as a key element in criminal fraud. "Clearly and knowingly false" is just a serious-sounding way to say a misstatement. Did Musk no…

not to mention that what his tweet said was "Secured funding." (many news organizations misquote it as "Funding secured.") In English, the sentence "Secured funding" is ambiguous in meaning: as a shorthand sentence, it could mean "we would only use secured funding for a transaction like this". "Secured debt" is a thing, and therefore secured funding is a thing. Unless he clarified it someplace else in a way that was…

> not to mention that what his tweet said was "Secured funding." (many news organizations misquote it as "Funding secured.")

This is not true.

https://twitter.com/elonmusk/status/1026872652290379776

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

#262

Post by chodeboy »

Latteland wrote: post #80

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…

people should take their tinfoil hats off. People don't short tesla because they are evil but because they think there a profit to be made.

You don't see eco-activist shorting ExxonMobil. Reasons simple: there is no reason to believe that ExxonMobil will go belly-up. Meanwhile, there are a lot of indicators that tesla could fall apart.

Just ask yourself: Is the tesla stock massively inflated or are there some anti-tesla illuminites who banded together to sabotage tesla with millions of risk capital just for the lulz?

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

#263

Post by abalone »

JumpCrisscross wrote: post #220
abalone wrote: post #121

Earlier quoted context omitted.

Nah, it's clear Musk hates short sellers. That's not the issue. Nor is his desire to hurt them. The question is whether he had scienter when misstating the finality of the deal he was negotiating.

> That's not the issue. Nor is his desire to hurt them. That's a huge issue. If he made his misstatements with the intent of hurting short sellers, that's criminal fraud. If he just made a material misstatement, with no intent to harm anyone, it's a civil case.

You inserted "intent". That is the key question, not whether he dislikes short sellers.

Every CEO dislikes short sellers, and nearly every CEO makes "material misstatements" now and then. What separates that from fraud is what the SEC focused on in their comment: scienter.

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

#264

Post by Keyframe »

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…

If it comes to worst, would it be possible for that single tweet to have started a damage chain worth far greater than actual Twitter market cap?

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

#265

Post by rootusrootus »

ivraatiems wrote: post #223
rootusrootus wrote: post #198

Earlier quoted context omitted.

Toyota/GM/Ford/VW/etc did not become big, successful corporations by dictating to consumers what they want to buy.

No, but they might be able to remain big, successful corporations by preventing consumers from buying anything else.

That kind of collusion is not only overtly illegal, but also extremely difficult to maintain, especially worldwide.

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

#266

Post by tedunangst »

jimmaswell wrote: post #226
WoahNow wrote: post #213

Earlier quoted context omitted.

What makes you believe that? All the major car companies are making EVs and there are several SpaceX competitors (Blue Origin in particular). The SolarCity side of Tesla's business is declining, but there are still many companies offering solar installations.

Besides that I feel Elon's companies are the more important industry leaders in those areas, is anyone else working on high speed underground transportation around the US or space tourism?

Musk won't be banned from tweeting ideas about hyperloop or whatever, so other ceos can still build those things after analyzing the cost.

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

#267

Post by SilasX »

abalone wrote: post #131
SilasX wrote: post #103

Earlier quoted context omitted.

Yes, it can be an oversimplification, but in this case it isn't. He clearly wanted to pump up the stock price and screw short sellers (he threw lots of indicators in the public space), and his statement was clearly and knowingly false. There was no secured funding. Optimism might justify a statement like "final stages of signing funding" or "almost closed the deal" or even "funding as good as secured" -- there might…

> He clearly wanted to pump up the stock price and screw short sellers (he threw lots of indicators in the public space), and his statement was clearly and knowingly false. There was no secured funding. No this is not textbook at all. See previous citation from the SEC re: intentionality as a key element in criminal fraud. "Clearly and knowingly false" is just a serious-sounding way to say a misstatement. Did Musk no…

>Did Musk not actually believe in his heart

So you're saying that, the way securities law works, personal optimism is all it takes to justify any representation of any upcoming financing terms? There's no requirement beyond what's in his heart?

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

#268

Post by onetimemanytime »

Asparagirl wrote: post #158
whatok wrote: post #29

Earlier quoted context omitted.

In addition to what other replies have said, Elon also has pledged some of his stock in order to secure personal loans. He will have to fund margin calls or sell his stock if the stock falls below a certain price.

THIS. Elon is the largest Tesla stockholder, but he has taken out huge loans against that stock. If the stock price of TSLA falls below about $230/share (there is some confusion about the exact price, but it's widely believed to be somewhere around there) his stock could all be sold to cover the loan, which would suddenly dump the stock price even further, or he could be forced to post more of his stock as collateral…

Wow! I Googled and there it is: *"At the end of 2016, Musk had 11,420,723 shares pledged as collateral. At the end of 2015, it was "4,000,000 shares of which are pledged as collateral to secure certain personal indebtedness owed to Morgan Stanley."" https://www.inc.com/erik-sherman/1-reason-why-elon-musk-migh...

His lifestyle isn't the big problem, IMO. He's not Johnny Depp, he's way richer. That money most be going somewhere else...

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

#269

Post by whatok »

mikestew wrote: post #241
kasey_junk wrote: post #146

Earlier quoted context omitted.

Pedantically shorting doesn’t have to be borrowing the underlying instrument. Put options are another way to trade on the idea that a stock will go down. I’d actually bet it’s the more common way. It would still be colloquially referred to as being short.

That's actually the opposite of "pedantically" given that you're playing loose with the definition. Pedantically, shorting is selling a financial instrument you don't own, with the idea (though it is not a requirement to fit the definition) that you'll give it back later by buying at a price lower than it is now. What you described is options trading, one method of which hedges against declines in stock price. Yeah,…

Pedantically, I would agree with your definition if it was phrased as "short selling" and would ask for more clarification ("via what?") if someone said they had a short position.

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

#270

Post by ivraatiems »

rootusrootus wrote: post #265
ivraatiems wrote: post #223

Earlier quoted context omitted.

No, but they might be able to remain big, successful corporations by preventing consumers from buying anything else.

That kind of collusion is not only overtly illegal, but also extremely difficult to maintain, especially worldwide.

It's certainly illegal, and it might be difficult to maintain, but I'd argue that it happens quite often across many industries, and very well could happen here.
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