Not sure if it was just Elon who was responsible for this, but the tweet shortly after that Tesla would accept BTC surely is the same as a potential pump and dump same.
We've seen so many finally being charged for this behavior, shouldn't Elon ?
My belief is that Musk’s primary motivation for buying Twitter is that during 2021 he saw how unreasonably effective the platform is for promoting crypto to retail, and he wanted to be the one who both decides which crypto goes up and also gets a cut on all the crypto cash inflows.
That’s why he talks about payments and a “super app”. It’s a dream of a crypto pump tax built into the promotional platform itself.
When making the offer in April 2022, I don’t think he anticipated the collapse of the ad sales at all.
The basic template probably looked like a typical private equity buyout: maintain existing revenue, cut costs to a minimum, load the company with debt to reduce the acquirer’s direct downside risk… And the crypto angle would be all personal upside on the short term, raking in the cash from token pumps that stripped-down Twitter wouldn’t be interested in policing.
> When making the offer in April 2022, I don’t think he anticipated the collapse of the ad sales at all.
I'm more inclined to believe that he was aware of the macro-economic conditions in 2022 when making the offer. Besides, he gave numerous speeches proclaiming that he was making the offer not primarily to make Twitter a profitable business.[0]
> raking in the cash from token pumps that stripped-down Twitter wouldn’t be interested in policing.
There isn't much meat on this bone.
For some perspective, Jeff Bezos bought Washington Post for $250M.[1]
Elon could afford without a sweat 3 or 4 such media organizations to manipulate information flow as he sees fit. With far better results than owning a social media platform.
Reporting the numerator without the denominator is a classic clickbait trick. In this case it was a 9% loss on $1.5 billion, during a period where tech stocks dropped 25-30%.
That's not really the right analogy. It's more like Tesla bought a new factory for $1.5 billion, realized they couldn't use it, and sold it back for $1.36 billion.
You could also look at it as "Tesla's investments devalued 1/3rd as much as everyone else's, outperforming the majority of the competition"
Listen to me, I hate Tesla and I hate Elon even more, but being disingenuous isn't going to improve things. Everyone had a bad time during covid. If you wanna make fun of him, why not talk about the Model Y steering wheel's ability to simply fall off while driving? It's pretty hilarious.
I'm not saying it's normal for large companies to invest their cash into yolo BTC and Doge (It's not), but it is common for them to invest it into something.
That something can be securities, hedges against volatility in forex, interest rate swaps, etc, etc.
Porsche was doing some pretty creative investing about 10 years back or so. If I recall correctly, it was working out quite well for them - until it didn't.
Here's a quick thought experiment. If you give $1 to everyone in the world, and if everyone uses that money over and over to play a double-or-nothing game, you will end up with around eight billionaires in expectation who did nothing but gamble with their money.
Now, you start with people with a million dollars, and all of a sudden you can reach eight billionaires with far fewer gamblers (proportionally fewer, in fact). So, given sufficient gambling tendency among millionaires, you will definitely find a handful of quite rich billionaires whose only skill is (1) being born rich, (2) getting lucky on the gambles.
Ah, wheel out the old misapplied thought experiment to limit the bazillion-variables-worth of the complexity of human experience down to a couple of integers and contrive an analysis to present as if it were useful.
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[ 2.6 ms ] story [ 84.0 ms ] threadWe've seen so many finally being charged for this behavior, shouldn't Elon ?
Bitcoin is a volatile instrument, so any change under a few years doesn't have much information content.
That’s why he talks about payments and a “super app”. It’s a dream of a crypto pump tax built into the promotional platform itself.
And crypto adoption is not at a level where he can even hope to break even on $40B off micro transaction charges at any point in his lifetime.
The basic template probably looked like a typical private equity buyout: maintain existing revenue, cut costs to a minimum, load the company with debt to reduce the acquirer’s direct downside risk… And the crypto angle would be all personal upside on the short term, raking in the cash from token pumps that stripped-down Twitter wouldn’t be interested in policing.
I'm more inclined to believe that he was aware of the macro-economic conditions in 2022 when making the offer. Besides, he gave numerous speeches proclaiming that he was making the offer not primarily to make Twitter a profitable business.[0]
> raking in the cash from token pumps that stripped-down Twitter wouldn’t be interested in policing.
There isn't much meat on this bone.
For some perspective, Jeff Bezos bought Washington Post for $250M.[1]
Elon could afford without a sweat 3 or 4 such media organizations to manipulate information flow as he sees fit. With far better results than owning a social media platform.
[0] https://www.youtube.com/watch?v=cdZZpaB2kDM
[1] https://www.reuters.com/article/us-washingtonpost-bezos-idUS...
If Tesla invested treasury cash in tech stocks they'd be similarly criticized.
How’s that?
Listen to me, I hate Tesla and I hate Elon even more, but being disingenuous isn't going to improve things. Everyone had a bad time during covid. If you wanna make fun of him, why not talk about the Model Y steering wheel's ability to simply fall off while driving? It's pretty hilarious.
I'd expect low-risk low-return bonds.
I know of no other major company gambling with crypto currencies.
Not even reputable banks.
That something can be securities, hedges against volatility in forex, interest rate swaps, etc, etc.
https://www.statista.com/statistics/1100132/apple-s-cash-usa...
https://www.npr.org/2023/01/12/1148634966/elon-musk-guinness...
And I guess from his perspective it was chump change.
Now, you start with people with a million dollars, and all of a sudden you can reach eight billionaires with far fewer gamblers (proportionally fewer, in fact). So, given sufficient gambling tendency among millionaires, you will definitely find a handful of quite rich billionaires whose only skill is (1) being born rich, (2) getting lucky on the gambles.