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SpaceX IPO Scandal

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Re: SpaceX IPO Scandal

#21

Post by bko »

el_nahual wrote: post #18
bko wrote: post #6

Earlier quoted context omitted.

> This Musk guy makes Ponzi look like the Pope I don't get it. He owns some of the companies out right and has no problem securing financing. Who is he screwing over? > First they only release 5% to 10% to create an artificially inflated price. Its called the low float strategy... Why would you float more than you reasonably would need. What's the upside of saying "we're worth X" due to a low float? Doesn't really bu…

15B in revenue is less than what AirPods sell in 6 months. It's less revenue than Spotify. It's nowhere near what should be necessary for a company to be "one one the most valuable companies in the world." Elon knows this. He knows that the 1.5 T "valuation" is nonsense. The market for space launches is quite simply not that big. How many more Starlinks does the world need? What would you do if I gifted you a satelli…

Agree that 15b in revenue is not a lot. Finance has always been about future growth with majority of companies value well out into the future. And this company is growing at around 50% and has insane margins. They dominate their space with overwhelming majority of global launches. So a high multiple is justified imo

Re: SpaceX IPO Scandal

#22

Post by akersten »

kmbfjr wrote: post #11
johnbarron wrote: post #2

At 25:48 you have the explanation for the (multiple) tricks: https://youtu.be/8rS3fTbC7TE?t=1548 This Musk guy makes Ponzi look like the Pope.You almost have to admire it the way you admire a raccoon breaking into a triple locked trash can at 2 AM. You are furious. You know you should be furious. But part of you is at the window wondering "how did he do that?". As you will see below, this raccoon is getting the trash…

I would think Fidelity, Vanguard et al are going to eat Musk for lunch. It’ll take a decade.

I think those boomer firms are asleep at the wheel and this kind of market engineering will completely blindside them. Vanguard can't even figure out how to show me my cost basis on the same screen as the one where I sell a security. What could they possibly be doing to prepare for this?

Re: SpaceX IPO Scandal

#23

Post by FireBeyond »

kmbfjr wrote: post #11
johnbarron wrote: post #2

At 25:48 you have the explanation for the (multiple) tricks: https://youtu.be/8rS3fTbC7TE?t=1548 This Musk guy makes Ponzi look like the Pope.You almost have to admire it the way you admire a raccoon breaking into a triple locked trash can at 2 AM. You are furious. You know you should be furious. But part of you is at the window wondering "how did he do that?". As you will see below, this raccoon is getting the trash…

I would think Fidelity, Vanguard et al are going to eat Musk for lunch. It’ll take a decade.

Is that before or after they eat Tesla for lunch?

Re: SpaceX IPO Scandal

#24

Post by x-complexity »

Veserv wrote: post #13
wcoenen wrote: post #12

Earlier quoted context omitted.

It seems the S&P 500 indices only take the free-float shares into account when calculating weights: S&P DJI’s market cap-weighted indices are float-adjusted – the number of shares outstanding is reduced to exclude closely held shares from the index calculation because such shares are not available to investors. page 6 of https://www.spglobal.com/spdji/en/documents/methodologies/me...

Yes, but not the Nasdaq-100 [1] which added the "Fast Entry" rule listed right there in section 2 literally this February because SpaceX is demanding immediate inclusion into the Nasdaq-100 as a condition for listing on the Nasdaq instead of the NYSE. [1] https://indexes.nasdaqomx.com/docs/NDX_Consultation-February... Section 3

> Yes, but not the Nasdaq-100 [1] which added the "Fast Entry" rule listed right there in section 2 literally this February because SpaceX is demanding immediate inclusion into the Nasdaq-100 as a condition for listing on the Nasdaq instead of the NYSE.

...Honestly, Nasdaq's to blame for bending the knee in this case. If they choose to chase that pie, then they alone should be the ones to bear the burden, including any/all reactions from passive investors.

Passive investors should (ideally) switch to another index if they wish to not be involved in this IPO. The decision of how they should invest is theirs, and if they're not happy with this index, they should move to another index: Their money talks louder than any posturing that could ever be put out.

Re: SpaceX IPO Scandal

#25

Post by nighthawk454 »

timoth3y wrote: post #10
johnbarron wrote: post #2

At 25:48 you have the explanation for the (multiple) tricks: https://youtu.be/8rS3fTbC7TE?t=1548 This Musk guy makes Ponzi look like the Pope.You almost have to admire it the way you admire a raccoon breaking into a triple locked trash can at 2 AM. You are furious. You know you should be furious. But part of you is at the window wondering "how did he do that?". As you will see below, this raccoon is getting the trash…

The saving grace of the SP500 and most similar indexes is that they are cap-weighted. So if SpaceX only, floats 5% only that 5% of their capitalization counts for index calculation. The Nasdaq100 is more complicated. SpaceX's 5% would be counted as about 25% of their total market cap for indexing.

It's worse than that, because S&P500 and Nasdaq100 share stocks. Like all of the MAG7 stocks. So if mag7 stocks dip because they're being structurally sold to buy SpaceX, then the S&P500 goes down too.

Arguably even worse because at least Nasdaq100 would have SpaceX in it that's getting bid up to offset the losses in other stocks. S&P won't have SpaceX right away. So it just goes down.

And the more those stocks go down, the lower their market cap - which means next rebalancing date they potentially get re-weighted again causing a bit more selling, etc. Presumably the companies that can will counter this with more buy-backs to keep their share price propped at an acceptable level (?).

Re: SpaceX IPO Scandal

#26

Post by infinitewars »

suralind wrote: post #20

Musk is the ultimate conman. I admire the work that SpaceX is doing, but Elon just plays the market, every single time. I don’t know why he’s allowed to do that and why people still fall for his promises. This SpaceX thing will make him 2 trillion guy, not the 1 trillion he’s promised to be.

Don't admire the work SpaceX is doing. It's a scam. They are a defense contractor that pretends to be about Mars. The technology is 100% about Golden Dome. Always was, read their real history,

https://wikipedia.org/wiki/Golden_Dome_(missile_defense_syst...

Re: SpaceX IPO Scandal

#27

Post by pu_pe »

johnbarron wrote: post #2

At 25:48 you have the explanation for the (multiple) tricks: https://youtu.be/8rS3fTbC7TE?t=1548 This Musk guy makes Ponzi look like the Pope.You almost have to admire it the way you admire a raccoon breaking into a triple locked trash can at 2 AM. You are furious. You know you should be furious. But part of you is at the window wondering "how did he do that?". As you will see below, this raccoon is getting the trash…

From your description it sounds like they could offer SpaceX at a valuation of $10T and be able to still sell because every passive fund is automatically forced to buy it. But obviously they need to target a price range that will be more or less stable, otherwise even in 15 days the price will free fall anyway. The only question is whether 15 days is enough to find a stable price or not, I agree it sounds rushed.

Re: SpaceX IPO Scandal

#28

Post by seanp2k2 »

DougN7 wrote: post #17
TimesOldRoman wrote: post #3

What scandal? Inflating share prices is standard fare.

Forcing everyone’s retirement funds to buy (at the artificially high and unsustainable price) is the scandal. Clever ploy to move more money from the plebes to the billionaires.

Good thing we can also preemptively divest on our retail accounts and just wait this out so we don’t get stuck bag-holding this turd sandwich. Ooh wait, selling triggers cap gains taxes.

What a great scam. So either dump all your index funds and pay the huge tax bill now or stay in and hope against all signs and odds that someone does something to stop this.

Re: SpaceX IPO Scandal

#29

Post by NewLogic »

seanp2k2 wrote: post #28
DougN7 wrote: post #17

Earlier quoted context omitted.

Forcing everyone’s retirement funds to buy (at the artificially high and unsustainable price) is the scandal. Clever ploy to move more money from the plebes to the billionaires.

Good thing we can also preemptively divest on our retail accounts and just wait this out so we don’t get stuck bag-holding this turd sandwich. Ooh wait, selling triggers cap gains taxes. What a great scam. So either dump all your index funds and pay the huge tax bill now or stay in and hope against all signs and odds that someone does something to stop this.

You can hedge the position via options without having a taxable event on passive investment.

Re: SpaceX IPO Scandal

#30

Post by ekjhgkejhgk »

Aside from SpaceX:

I had never appreciated that IPOs are almost always for a tiny fraction of the shares. It is immediately apparent to me that IPOs where you only sell a tiny fraction of the shares are less about raising capital and more about giving insiders a chance to unload their shares.

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