News
Welcome to the News community!
Rules:
1. Be civil
Attack the argument, not the person. No racism/sexism/bigotry. Good faith argumentation only. This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban. Do not respond to rule-breaking content; report it and move on.
2. All posts should contain a source (url) that is as reliable and unbiased as possible and must only contain one link.
Obvious biased sources will be removed at the mods’ discretion. Supporting links can be added in comments or posted separately but not to the post body. Sources may be checked for reliability using Wikipedia, MBFC, AdFontes, GroundNews, etc.
3. No bots, spam or self-promotion.
Only approved bots, which follow the guidelines for bots set by the instance, are allowed.
4. Post titles should be the same as the article used as source. Clickbait titles may be removed.
Posts which titles don’t match the source may be removed. If the site changed their headline, we may ask you to update the post title. Clickbait titles use hyperbolic language and do not accurately describe the article content. When necessary, post titles may be edited, clearly marked with [brackets], but may never be used to editorialize or comment on the content.
5. Only recent news is allowed.
Posts must be news from the most recent 30 days.
6. All posts must be news articles.
No opinion pieces, Listicles, editorials, videos, blogs, press releases, or celebrity gossip will be allowed. All posts will be judged on a case-by-case basis. Mods may use discretion to pre-approve videos or press releases from highly credible sources that provide unique, newsworthy content not available or possible in another format.
7. No duplicate posts.
If an article has already been posted, it will be removed. Different articles reporting on the same subject are permitted. If the post that matches your post is very old, we refer you to rule 5.
8. Misinformation is prohibited.
Misinformation / propaganda is strictly prohibited. Any comment or post containing or linking to misinformation will be removed. If you feel that your post has been removed in error, credible sources must be provided.
9. No link shorteners or news aggregators.
All posts must link to original article sources. You may include archival links in the post description. News aggregators such as Yahoo, Google, Hacker News, etc. should be avoided in favor of the original source link. Newswire services such as AP, Reuters, or AFP, are frequently republished and may be shared from other credible sources.
10. Don't copy entire article in your post body
For copyright reasons, you are not allowed to copy an entire article into your post body. This is an instance wide rule, that is strictly enforced in this community.
view the rest of the comments
The thing is, selling off the amount of Tesla stock that he’d need to to pay off the debt would cause Tesla stock to plummet, leaving him significantly less wealthy and putting Tesla in danger. So even though he technically has the money to pay them, he functionally doesn’t.
He both technically and functionally does have the ability to repay them, which he will find out soon if he doesn't restructure the debt, and implying this is in anyway similar to the financial crisis is absurd clickbait.
It could possibly tank Tesla and make Elon less rich if he had to pay his debt. Oh no. As if Tesla being valued at more than 9 major other automakers combined isn't outlandish in the first place.
But won't someone please think of the oligarch and his shareholders! 🙄
This is so spot on.
Him being kicked out of the billionaire club would be a net gain for humanity
I think it's similar in the fact that banks once again gave credit where the securities are massively overvalued; and I'm not sure there are enough investors around to pay that much money for shares. What are bag holders gonna do when the price goes down because a lot of shares are selling?
Anyhow, this assumes a sane market, which hasn't been the case for Tesla for 5 years.
No debt holder is obliged to consider the reprecussions of collecting their debt, just look at house foreclosure. The wellbeing of a thrid party company has no bearing on the ability to pay back a debt, and there are stock sell off plans that facilitate large liquidation over a period of time to ameliorate the stock price drop and prevent it from a full crash. Anyone who tells you otherwise is simply licking billionaire boots.
The person you're responding to is literally arguing that Elon can't "functionally" pay the debt because it would make him less rich and lower Tesla's share price.
Their breath smells like Italian leather.
"Rich Corinthian leather"
Corinth is famous for its leather!
Ricardo Montalban approves.
If you think for one minute I like Elon Musk, I invite you to check out all the negative articles, including this one, that I’ve posted about that piece of shit. I’d love for him to lose every red cent he’s got. I’ve hated him since before it was cool.
You don't really understand the point I think, whether it's correct or not I don't know. His theoretical wealth is derived from the price of the last share sold. He probably can't just sell ($13bn/current share price) shares and get $13bn out of that, there aren't enough buy orders at that price, and you risk a panic sell by other holders. These other holders possible also include the banks were talking about, or at least related businesses and their clients.
Long story short, if banks had him liquidate shares worth $13bn, his net worth would fall (not the banks direct problem, bit probably wouldn't make future client acquisition easier); but it might be that they lose more money indirectly. All this calculation with a stock's market cap is a bit like a house of cards; it's really high, but don't shake it too much. At least that's an issue with overvalued stocks; sound businesses where the stock price reflects the company's actual value, maybe even pays dividend, don't have that problem.
He said it perfectly. There are sell off plans.
If not only Musk but also the banks are stuck in this problem, it's their own fault and incovenience. Not sure why you ignored his completely verbose explanation of how this problem is only Musk's (and maybe the banks he made the deal with).
Talking about individuals/market makers and their bots panic selling the stock is ridiculous, and subverts the idea of a free market. And as you say, the company's value barely reflects it's output, so it should happen, and it is odd that it didn't.
That's the thing, the banks fear it will be their problem. They don't care about Tesla as a third party, but themselves.
I'd love Musk to get fucked by this whole ordeal. This was rather about if the creditors allow it or of they're afraid of the fallout.
And you're right, it won't be all instantly sold, but it is a large amount of shares and I'd think it would have a negative impact on share price.
So, if his divestment of such a large amount shares in either company would have a negative impact on stock price, wouldn't the other share holders have a say in the matter? They typically frown upon someone acting in a manner that will devalue their share prices. I'm honestly asking bc I don't know the ins and outs, but I would assume that if Elon were to just try and sell shares to pay off his problem the pitch forks are going to come out from other share holders.
Also, wouldn't the banks potentially be in a conflict of interest? Presumably those institutions who gave him the loans have invested clients money into those stocks potentially? Again, just asking the question, bc this seems like a major boondoggle that could really fuck over a lot of people in a variety of ways.
I guess it's possible. But to me it sounds too much like an extra conspiracy. The banks could just sell off the stock (give zero fucks about other banks), and then force Musk to liquidate.
Of course he can, it would just inconvenience him.
Does he seem for even a split second like someone who can handle being temporarily inconvenienced?
Fair enough😂
Does the stock necessarily get liquidated for these sorts of transactions though?
Obviously if I owe the bank $100, they will want that in cash, not in $SPY or whatever. But for the Twitter levels of debt could stock just be transferred without being sold first? (Not a rhetorical question, I don't know how this works.)
Oh, so he gets to be treated like the rest of us now....right?
If I stopped paying my mortgage, regardless of how bad off I may be, the bank is taking my house.
Guess he should've been more responsible, not eaten avocado toast, and saved more or whatever the fuck conservatives say to struggling millennials and younger folks.