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SpaceX bond worth 10% less than issue price – heading for junk bond status

ft.com

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Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#211

Post by riazrizvi »

somat wrote: post #53

A stupid/naive question. Why does this affect SpaceX? They have their money(The IPO) Any third party trading value does not change that. Sure there may be individuals, officers of SpaceX who hold these instruments who will be negatively affective, but the company itself? My best guess, it makes it harder to get loans in the future.

They have a $5bn credit line, and this means the creditor might increase the interest on it.

It's better described as "it increases operational risks to SpaceX". When they face some future difficulty, the odds they can come out of it are lowered. Which is itself a factor that partners consider, including employees, because obviously people prefer to bet their livelihoods on more of a sure thing.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#212

Post by inigyou »

tyre wrote: post #46
richwater wrote: post #42

Earlier quoted context omitted.

The Nasdaq is a shit index to begin with. There are so many other options.

The NASDAQ is up 27% in the past 1 year. S&P 500 up 21%, DOW +20%. So, it's doing pretty well!

Interesting, so a shit index is whichever goes down and a good index is whichever goes up?

Does the same rule work in crypto?

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#213

Post by cyberjerkXX »

crimsonspy wrote: post #80
xutopia wrote: post #61

I can't comprehend for the life of me that people put their life savings in what Elon Musk is doing. Are people not seeing how he's lying about the future all the time? He said he aimed to have 5000 Optimus robots out by end of 2025, 50000 by 2026 and 10 times that in 2027. He promised in 2015 that full autonomous driving would arrive in 2 years and we aren't there yet 11 years later. He even said in 2016 that there…

He claimed that he would unearth billions of dollars of government fraud, only to lie about that too. Instead his team cut aid programs and have contributed to an estimated 700,000 deaths so far. https://www.newyorker.com/news/the-new-yorker-interview/the-...

[flagged]

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#214

Post by inigyou »

dofm wrote: post #140
aynyc wrote: post #92

Earlier quoted context omitted.

This is about their bond, not that share price. If you are in the US, it's like having low credit score, everything you want to do financially such as leasing or financing a car, buying a house, etc.. will be more costly (higher interest rate) from the lender.

Except that it's not clear really that lenders will be able to judge on that basis alone. SpaceX is a different kind of unicorn: it's a government contractor run by the richest man in the world who controls a media echo chamber and gets people elected. That article compares them to Oracle. Who are, as it goes, pretty similar: run by rich people with a media empire who have their teeth deep in government systems. Thes…

The bond price is an outcome of lenders judging, not a cause. Lenders have already judged.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#216

Post by stackghost »

tjwebbnorfolk wrote: post #190
stackghost wrote: post #171

Earlier quoted context omitted.

>QQQ and /NQ or /MNQ futures are the most popular instruments for getting exposure. QQQ tracks the Nasdaq 100. It's an index fund. If the index includes a new ticker, then QQQ has to buy it. Buying QQQ doesn't seem like going out of one's way. I don't understand your comment. "ETFs and chill" is a very common investment strategy.

And who is forced to buy QQQ?

I'm not sure why that's relevant. The original discussion was about who's forced to buy NDX 100 stocks like SpaceX. The answer to that is "index funds".

Asked and answered. Whatever cute point you're trying to make is rendered moot by real market dynamics and index inclusion rules.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#217

Post by CamperBob2 »

riffraff wrote: post #200
throw1234567891 wrote: post #164

Earlier quoted context omitted.

The president may throw a tantrum that “some crazy democrat throws stones under the feet of that beautiful Elon, the most beautiful Elon we ever had”. Better do what the new Tzar wants. Dude was sent here apparently by the God, don’t mess with the God.

Musk and Trump had a pretty public break up, I think this is one fuckup where we shouldn't blame him.

https://en.wikipedia.org/wiki/Kayfabe

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#218

Post by aplummer »

inigyou wrote: post #195
smallmancontrov wrote: post #183

Earlier quoted context omitted.

You're forgetting that whenever the incentives lead to bad places it isn't True Capitalism (tm).

True capitalism has never been tried. This right now is crony capitalism.

Does seem a bit like; we’ve never tried roasting people at 1200C, only at 1000C

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#219

Post by lokar »

fouc wrote: post #58
lucd wrote: post #41

The worst about the SpaceX IPO is Nasdaq changing their inclusion rules for the Nasdaq 100. The index fast-tracked SpaceX stock for inclusion 15 days after the IPO, instead of the normal three-month seasoning period. They also changed its 10% minimum float rule to a 3x weighting boost for low-float stockss. So many people will unwillingly and prematurely invest into SpaceX, before it has any chance to discover its re…

Nasdaq, FTSE Russell, and CRSP all implemented fast-track options. Fortunately S&P kept its 12-month requirement.

CRSP has always had a short waiting period, they did not change it.

They did lower the free float rule

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#220

Post by nemomarx »

qup wrote: post #142
fnordsensei wrote: post #83

Earlier quoted context omitted.

I have a friend who unironically said "Elon Musk is the most important human who has ever lived"

Who's your pick?

Genghis Khan or Napoleon, maybe? Probably you'd want to pick someone further back but before the modern era you lose details.

Musk has made some tech innovations but he hasn't changed the lives of many generations of people yet. I'd only put him at the level of Edison

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