He has done this move before with Tesla buying Solar City. When you do a deal with yourself you can assign any value you want to assets, it isn’t a competitive process. In the previous case Solar City was dying but its acquisition by Tesla was pitched as a great synergy.
Its not like the courts are investment banks with an evaluation arm. They are just judging if anything reaches the point where shareholders were legally harmed, which still gives a lot of gray area to the acquiring company.
Lawsuits can fail for lots of reasons without a decision on the merits. It seems relevant that the reason the lawsuit failed is because the court looked at the fairness of the transaction and determined that Tesla paid a fair price.
The commenter you are responding to is explicitly intending to place more emphasis on the reason why the lawsuit failed. That is why they used the phrase “burying the lede” in their initial comment.
Hold on, I feel like everyone's missing that theres a real argument here. I think the key point was:
>They are just judging if anything reaches the point where shareholders were legally harmed, which still gives a lot of gray area to the acquiring company.
This distinguishes the lawsuit failing from the idea that a fair price was paid. The competing contentions are (a) fair price vs (b) unfair but beneath threshold of legally punishable harm.
Note that this is a civil suit, so the concept of a “threshold of legally punishable harm” doesn’t apply. There’s no “punishment,” and the plaintiff doesn’t need to meet the high standards (proof beyond a reasonable doubt, etc.) for imposing a punishment.
Under Delaware law, there’s two standards for evaluating this kind of claim. When there is no conflict of interest, the court applies the “business judgment rule,” which is similar to what you seem to be thinking—it gives corporate officers wide latitude.
But when there is a conflict of interest, the court applies the “entire fairness” standard, which requires both fair dealing and a fair price. And a fair price means what it sounds like—it’s what an objective businessman would consider a fair price under the circumstances. It doesn’t need to be the best price, but it must be within the range of fair. And to establish a fair price, the court relies on evidence from financial valuation experts. It’s a rigorous standard that’s hard to meet.
> And to establish a fair price, the court relies on evidence from financial valuation experts.
I generally find expert testimony to be suspect. Anyone can be trotted forward as an expert, rattle off their credentials, and say whatever they feel like saying, depending on who is paying them to testify. And financial valuation is not a science; there is of course plenty of math involved that takes into account hard, objective numbers, but a good chunk of it is opinion, too, as no one an know the future.
Having said that, the Delaware Chancery Court of course has more experience in these matters than any other state's courts, so I am of the opinion that they're less likely to be duped by "experts", but sill... it can and does happen.
I agree with you to a degree about expert testimony. But I’d argue that a Delaware Chancery Judge reviewing expert opinions from major investment banks is more likely to come to an accurate assessment than many other people offering view on the transaction. The legal ruling isn’t definitive for anything more than the case that was before the court, but I think it should be heavily weighted by anyone trying to inform their views about what happened.
I’d also point out that, in the legal industry, Delaware’s entire fairness standard is seen as a rigorous standard that typically results in victory for the plaintiff. The Chancery Court ruling resulted in various law firm updates using the case as an example of how the entire fairness standard isn’t always a death sentence for defendants.
NCEES has brought back the controls systems professional engineering licensure. This is the same license that civil engineers use to stamp designs for example.
Of course, the license doesn’t mean anything if everyone falls under an industrial exemption. I’d be in favor of safety-critical software requiring a PE stamp.
I have two feelings on this. One of which is alarm because it is a sentiment like this which is the backbone of misinformation believers and spreaders and we're in the worst era of misinformation I think that we've been in in a long time. Certainly the worst since the dawn of the digital age. Experts are right about vaccines. Right about building your savings with a 401k. They're right about using sunscreen. They're right about not ingesting too much sugar. They're right about reading to your kids from an early age and right about the impacts of tariffs on the economy. They're right about climate change. They're right about the Higgs Boson, etc. etc. In almost every case, the people going against the experts on these things are cranks, frauds, or confused conspiracy theorists.
But my other feeling is one of agreement in a very qualified sense. I believe that within the U.S. legal system, people who are presented as experts in certain forms of science, are able to invoke an unearned professional authority and legitimacy that has nothing in common with genuine expertise. When we talk about pseudoscience in the modern age, a lot of the time it's about new age crystals or evolution denial, but I think expert witnesses presented as authoritative in courtrooms have been responsible for generations upon generations of pseudoscience of various types. Everything from penmanship analysis to bite mark analysis to body language experts to, rather remarkably, supposed 911 phone call tonality analysis experts Who can include that wrongly timed emotional tremors or presence or absence of emotions prove the callers involvement in a crime.
And while it might be a gray area, I suspect there's at least a fair amount of crankery or motivated reasoning with hired gun economic experts summoned to Delaware courts to testify in favor of major corporate acquisitions.
I feel like this fixation on "punishment" as a legal term of art is not strictly necessary and my point can be reinterpreted in a charitable way that restates the same thing using different but functionally equivalent magic words.
So swap out "punishable" and instead say "legally actionable" (or other preferred synonym) and you nevertheless have an assessment that falls under what you noted is the entire fairness standard and the upshot is the same.
Also my understanding is that courts defer to the experts of the acquiring company. And if those experts are predisposed to have a favorable interpretation that favors the acquiring company, the valuation is in the less than optimal range of a range of values produced even by them, and they, by contrast to an actual market, might be much more lenient than a market would be in determining the price. So there's a convergence of variables that underscore the difference between fair as we conventionally understand the term (which is what we were all interested in here) and whatever it means to have survived legal scrutiny in Delaware.
Which again I would say means that this debate has real teeth and it's more than semantically equivalent differences in emphasis.
(c) no fair price can possibly be determined but the burden of proof lies with the claimant
(d) a court has no idea what a fair price would look like but made a finding of fact based on expert testimony despite being poorly situated to evaluate it
That’s generous. One party is stubbornly missing that the Delaware court’s ruling is weak evidence of a proper valuation having been done, but wants to parrot an irrelevant textbook understanding that obfuscates that conclusion.
It's worth pointing out (IMHO) given the other comments that it's actually more than that - the fairness standard requires they prove the process was fair as well (IE a fair process that generated a fair price), which the court found they did as well.
(As you know, but others may not - this is not always the standard vs the business judgment rule, but is the standard here)
You joke, I think, but I do think a solid welfare state delivers benefits that a mainstream economist would recognise. I fancy the long-term prospects if a country with a safety net higher than one without, all other things being equal. I see more inherent value in the public sector than the private.
Unfortunately the private sector has dominated the zeitgeist for decades; a kind of meta-regulatory-capture, if you will.
I can't trust that there will be a state pension waiting for me. So I'm in the private sector. Got some bonds in my mix, at least.
This is true but it's not as far off as you think.
In this case, the court doesn't have to just find it was a fair price, but a fair process as well.
That is, the standard the defendants have to meet (not the plaintiffs, the burden is actually on tesla here despite having been sued) is that the transaction was entirely fair to the corporation and shareholders- the process was a fair one, the price was a fair one, etc.
I have trouble thinking of a case where you can prove all this[1] but the market would have come up with something different. Almost by definition, if the market would have decided to pay a lower price, either the price or the process was probably not fair.
[1] Which again, you have to do affirmatively. You aren't just rebutting plaintiff evidence, the burden is on you to show the fairness
Even if there was a market, any market naturally requires adversarial decision making in the negotiation of a deal to have economic calculation (what we generally view the benefit we derive from a market in the first place).
When the same people are making the ask as making the buy, you literally cannot decouple the decision-making in a way that objectively eliminates cooperation.
A market cannot exist when the entities involved abandon adversarial decision-making and cooperate. One's priority is always suborned by one or the other.
And what happened to Tesla solar roofs? Haven’t heard about those since like 2020. Who actually has one? And Tesla trucks? And full self-driving? And robotaxis? And the private venture around the moon?
It’s like everyone just forgets Musk’s announcements that never get delivered on.
Solar roof installs are continuing to grow. Slower than they hoped, but growing.
The semi factory will be finished late this year.
FSD gets better each month. Obviously there is massive debate if it will be “done” in 1, 2, 5, 10 or never years
Robotaxis were announced recently, the plan as announced is for them to be sold in 2026. That has not changed.
Looks like they’ll have some kind of driverless taxi service running this year with remote operators like Waymo.
Private moon mission was canned.
I think it’s pretty strange to say Musks promises never get delivered on when Tesla sells the most popular car on the planet two years running, spacex launches more to orbit than the rest of the world combined and a ton of other stuff.
Obviously he’s utterly nuts, and doesn’t deliver everything he talks about, and is very late on many things. But you have to be blind to say he never delivers anything.
No, a self driving car can be either supervised or unsupervised.
I'm required to supervise my car while it drives me to work, but it is by definition fully self driving, controlling all aspects of the vehicle while I sit with hands off the wheel watching
[2017] The sensor hardware and compute power required for at least level 4 to level 5 autonomy has been in every Tesla produced since October of last year.
[2017] I think that [you will be able to fall asleep in a Tesla] is about two years
[2018] Probably technically be able to [self deliver Teslas to customers doors] in about a year then its up to the regulators
[2019] We expect to be feature complete in self driving this year, and we expect to be confident enough from our standpoint to say that we think people do not need to touch the wheel and can look out the window sometime probably around the second quarter of next year.
[2020] Robotaxis release/deployment... Functionality still looking good for this year. Regulatory approval is the big unknown
[2020] I am extremely confident that level five or essentially complete autonomy will happen, and I think, will happen very quickly, I think at Tesla, I feel like we are very close to level five autonomy. I think—I remain confident that we will have the basic functionality for level five autonomy complete this year, There are no fundamental challenges remaining.
[2020] I'm extremely confident that Tesla will have level five next year, extremely confident, 100%
[2021] FSD will be capable of Level 5 autonomy by the end of 2021
My understanding is that the solar roofs are basically dead. They're more of a vanity project than a real product. The total production of the tiles is enough to cover like 10-20 houses a week and the full system price is around 5 times what a regular solar install costs, even when you factor in replacing the entire roof before doing the solar install.
The project was unilaterally cancelled by the client, Yusaku Maezawa, in May 2024. Starship development had fallen significantly behind the original SpaceX aspirational date for the flight in 2023, and Maezawa's net worth had also halved since venture was announced in 2018.
How many children with how many women? How many disowned? False accusations of pedophilia against people he doesn’t know? Free speech absolutist who gleefully bans speech? Corporate acquirer who accidentally fires key people, and then makes the exact same mistake as a coup leader?
He is batshit. He is also smart and has accomplished some impressive things. The two are not incompatible.
> How many children with how many women? How many disowned?
That's common human behavior.
> False accusations of pedophilia against people he doesn’t know?
Against a single person who had just called him "insane" on TV. Not nuts at all.
> Free speech absolutist who gleefully bans speech?
Not all speech is free speech - you cannot advocate for hits on people, for example. Besides, it's perfectly legal to censor speech on his platform. Not nuts at all. Musk has made no attempt to suppress speech on Bluesky, Facebook, Reddit, Tiktok, etc.
> Corporate acquirer who accidentally fires key people
That's not how it worked. Twitter was losing money at an astonishing rate, and he had to cut expenses immediately. It is the fastest way to determine who was actually needed and who wasn't. Then hire back the ones who were actually needed.
> makes the exact same mistake as a coup leader?
It's the only way to do it when time is critical. It's also the only way when the agencies are doing everything possible to not cooperate with DOGE.
When a criticism sounds like a substitute for the real reason a person hates Musk, it is totally unfair.
For example, where was the disgust at the person who publicly called Musk insane first? A fair criticism would have included that. A fair person would also be aware that there is not a single person on the planet who has not called someone else a nasty name.
Ah, so Musk must have X systematically taking down calls for public execution of his political enemies, then? This is a legit exception to free speech absolutism and he is just asking Reddit to do the same thing he does on his platform.
I’d argue he offsets his risks (but not profits) to the taxpayer. His high-risk bets have largely been buoyed by government contracts, subsidies, and borderline crony-capitalism. In many respects, that’s not always bad for the taxpayer when he delivers, but it’s not the same as being a free-market risk taker.
I recommend reading a biography of him. He did not offset risks to the taxpayer. SpaceX, for example, got contracts from NASA. He delivered on those contracts. If he hadn't, he would have gone bust, not the taxpayer.
At one point with Tesla he was within hours of business and personal bankruptcy, before making a deal with an investor. The investor wasn't the government.
You may want to familiarize yourself with counter examples from Musk biographers, like Seth Abramson.
Musk said himself SpaceX would’ve gone bankrupt without NASA contracts. He needed those contracts because Spacex was too high of a risk at the time for private business. NASA is self-insured. This is the the way the government supports high-risk nascent industries, because they are the only institution capable of shouldering that risk.
It’s well-established that the solvency of his companies are tightly coupled, just like TFA. Further, Tesla is made competitive by subsidies for EVs and manufacturing. Not necessarily bad, but the success isn’t occurring in a free-market vacuum. When companies accepting subsidies go under, the govt doesn’t typically get that money back, at least not in full. (See the faux Solyndra “scandal”)
I know that doesn’t fit the preferred narrative of the mythical free-market iconoclast succeeding in spite of the govt, but that’s reality.
On the profit side, I should have said he gets a disproportionate amount of profit and the taxpayer gets a disproportionate amount of risk.
“And he wasn't paid until he delivered, like any contract with a business”
I don’t know the specifics of these contracts, but I very much doubt it based on my experience. That’s not how any Government development contract I’ve ever worked on has worked… There are startup payments, payments for milestones (including many at the start for various design stages before anything was built), payments at varying levels of build, etc… - often more than half (sometimes more than three quarters) of the contract value was paid before the final product was delivered.
We did some pretty cool things too (this was in defence satellite communications) but various Government customers took like 80% of the risk on the development most of our big products (obviously we had already proven our design abilities with smaller components but much smaller scale), which we would then sell to them and other Governments.
I’d implore you to research more about how the CCP is administered. There are payments before any astronaut gets a ride. Meaning if the company goes out of business beforehand, the taxpayers lost that money without receiving the actual service intended. That’s also why NASA selected two CCP contractors, it distributes the risk. Maybe you think socializing risk to the taxpayer makes him a smart businessman, I just wish people would comes to terms with the fact that his wealth is inextricably linked to taxpayers. Like I said before, it’s not even necessarily a bad thing but call it what it is. I personally think the hybrid public-private arrangement works well when it’s not being abused.
Regardless of all that, the point was that Musk is not a paragon of free-market capitalism. Nothing you’ve pointed out negates that point, yet people still cling to that narrative for…reasons. I suspect it has more to do with cognitive biases than reality.
My house was built to my specification. The general contractor required that I make progress payments. He wanted to be sure he wouldn't be left holding the bag for all of it after I moved in (and he also needed cash to buy supplies and hire subcontractors). I took a risk he didn't just disappear with the up front payment.
When I had the roof replaced, I had to pay half up front.
And so on. This is normal business practice.
There is nothing not free market about progress payments.
(Besides, if NASA was fronting all the money, SpaceX wouldn't have gone bankrupt if the rocket blew up. But what I've read was Musk bet the company on it not blowing up.)
I decided to check one detail. The EV subsidy came in the form of a tax credit to the buyer, it is not paid to the car manufacturer. Musk had nothing to do with it.
> I suspect it has more to do with cognitive biases than reality.
Imagining oneself as dealing in reality rather than cognitive bias is yet another cognitive bias. Everything written about Musk is subject to cognitive bias one way or another.
You order an uber. You aren’t expected to make progressive payments so the driver can buy the car, get gas, etc. That’s the more appropriate analogy. As I said, CCP is a service contract, not a product. A house is a product so it even if the contractor goes out of business, you still have the foundations, studs, etc. ie your payments cover the partial product you are actually contracted to receive. A house is a misapplied analogy that belies some ignorance on the commercial crew program.
Businesses can leverage POs to fund operations. That’s why the NASA contract matters.
Yes, the EV subsidy goes to the buyer. The point was it makes the product more competitive at its price point. That point still stands. Besides, Tesla also benefited from multiple other taxpayer benefits. For example, they get hundreds of millions in tax incentives for their factories. Again, their profitability is propped up by taxpayers.
I’ve never claimed to be completely unbiased. However, we do have the benefit of testing out narratives with facts. The mental gymnastics needed to deny that these ventures/profits are somehow not related to taxpayers is, in a word, “nuts”
> You order an uber. You aren’t expected to make progressive payments so the driver can buy the car, get gas, etc. That’s the more appropriate analogy.
It's utterly inappropriate. First, your card is submitted and approved prior to you getting the ride. The uber is going to get that payment, you have no choice. Second, I wouldn't be surprised if the amount is put on hold with the credit card company before the ride begins - I know gas stations do this. Third, it's a trivial amount of money compared with buying a house. Fourth, the uber driver cannot operate if he hasn't already bought the car and the gas.
> That point still stands.
Musk had no control over it. The tax credit was given to the consumer. It also was for all EVs, it was not targeted at Musk.
> they get hundreds of millions in tax incentives for their factories. Again, their profitability is propped up by taxpayers.
A tax abatement is not a subsidy. A subsidy is a payment. Tax abatement is not "propped up" by other taxpayers, they did not get their taxes raised by it, and the company was not previously paying taxes for that location.
I'm curious why you (apparently) think that anyone could have done what Musk did? Why didn't you (or anyone else) get those subsidies and tax credits and contracts and create Tesla and SpaceX? I've read that Musk is an imbecile who somehow failed into being the richest entrepreneuer on Earth?
Tesla + SpaceX is worth about $1.2 trillion dollars. If the government started it with a billion dollars, consider all the taxes Tesla + SpaceX + Musk + employees + investors has paid since. Wow what a return on investment! And as a bonus, NASA gets to shoot off rockets that cost only 10% of NASA-built rockets.
C'mon, this is bordering on a disingenuous argument. You can't acknowledge the different between a service and a product. That's literally the novelty of the CCP. In general practice, you don't pay for a service until after its rendered. But not the case in the NASA contract. If your Uber doesn't show up, you'll get reimbursed whatever small hold they put on. You're only out the service. If SpaceX went belly-up, NASA isn't getting milestone payments back and they don't get their ride. They're out payment and service.
>Musk had no control over it.
Are you claiming that subsidies don't get factored into a business plan? Again, the point is government action makes the business more competitive/profitable. Subsidies to the consumer absolutely impact that. Tesla's own filing acknowledge this point. E.g., they mention regulatory credits add $2.7B to their revenue. They also mention how consumer subsidies impact consumer demand for their cars, and how tax abatements are fundamental to projected operating expenses and financial obligations. Their own statements run afoul of the narrative you're defending.
>they did not get their taxes raised by it, and the company was not previously paying taxes for that location.
Correct. We agree the taxpayers are losing an income stream. If your house was built in a location, do you think you could claim "well there was nothing here before, so not paying income taxes is of no consequence"? It's a weird take if you think the public isn't offering something of value with beneficial tax breaks. If they are offering something of value, they are helping the business. I also agree the taxpayers can benefit from it, I don’t think they have to be in conflict, just acknowledged.
>I'm curious why you (apparently) think that anyone could have done what Musk did?
I've never claimed that, you seem to border on fanboy admiration of him. I think Musk is a once in a generation entrepreneur. I also think his business MO is heavily reliant on government contracts and special treatment. Those two aren't necessarily mutually exclusive. But the latter is contradictory to free-market ideals. That's the point that you're constantly side-stepping. Worship him if you want, but also acknowledge his success is tightly coupled to governmental help.
SpaceX has done amazing things. Buit I'm going to venture we have different opinions why. IMO, t's because they get to operate under different rules. I think the main advantage that NASA is buying is a plausible way to skirt a lot of the rules (political and technical) they must abide by. CCP does not, and that's largely why they can do things differently. That's not a guarantee of success (see: Boeing) but it sets the table.
You may not realize it, but we've had this same tired discussion a while ago. At that time, I said we will see Musk's business acumen with what he does with Twitter. Apropos of TFA, that doesn't currently put him in good light. 6 months ago it was valued at $9B, and then shortly later valued at $45B so that he could essentially sell it to himself at that valuation. At the very least, that indicates a lot of uncertainty. That is a suspect valuation, but to be generous there are some differential outcomes: 1) xAI becomes profitable largely due to the synergies from the sale of Twitter/X, 2) xAI is profitable in spite of the purchase, 3) xAI does not become profitable. It will be interesting to see, and I will be interested to see if we'll ever get insight into the private company to find out. It will also be interesting to see if future success is still coupled to government/political help; I suspect that's a drug hard to break from.
> his business MO is heavily reliant on government contracts and special treatment
He sells rockets to the government at 10% of what it would cost the government to buy them elsewhere. It's clearly Musk helping the government. Besides, Musk did not get subsidies for SpaceX nor special treatment.
> Are you claiming that subsidies don't get factored into a business plan?
No, I claimed that Musk had no control over the EV subsidy, which was given to buyers of electric cars from any company.
> acknowledge his success is tightly coupled to governmental help
Making a better, cheaper rocket is helping the government save tens of billions of dollars.
> contradictory to free-market ideals
The government keeps taking our economy farther and farther from the free market. Government taxes, subsidizes, and regulates. It isn't really possible to run a free market business in the US.
I know it's cool these days to dump on Musk and denigrate his achievements with "you didn't build that" (as if anyone else could have done it), but history will show him to be the greatest entrepreneuer the world has ever seen.
The government has subsidized other companies. None of them succeeded like Musk did. Not remotely. The idea that the government created Musk is just nonsense.
> buoyed by government contracts, subsidies, and borderline crony-capitalism
What you're describing is Lockheed, Boeing, Rockwell Collins, etc. SpaceX is the opposite--it provided NASA a service that was necessary for NASA to operate, at a fraction of the cost of competitors: https://ntrs.nasa.gov/citations/20200001093.
The fact that NASA makes interim payments on the contracts doesn't turn a purchase of services into a subsidy. "Free market" does not mean "off the shelf." It's extremely common in B2B settings for buyers to shoulder some up-front costs to develop products or services that aren't available in the market. For example, Apple made a large up-front payment to a supplier to speed up development of sapphire glass: https://www.cultofmac.com/apple-history/iphone-sapphire-glas....
Buyers take-on some risk when they do that, but that doesn't make it a subsidy. In Apple's case, they take on the risk in return for the bet that a supplier can provide them with huge volumes at a low price. In NASA's case, it took on some development risk because SpaceX promised a large reduction in launch costs.
I agree it applies to other contractors. My point is that the success is tightly coupled to the willingness of taxpayers to fund the operations.
You’re muddling points. I’m not saying the NASA contract was a subsidy. Tesla is a better example of subsidies.
No private capital was willing to contract to SpaceX until the risk was lowered. They’ve succeeded in doing so and deserve credit. However, they would have never gotten to that point without taxpayer dollars. Governments were the only institutions capable and willing of taking on that high initial risk. That point still stands. It’s odd that your stance denies that when Musk himself has admitted it.
You seem to be bent on have an altogether different discussion because you’re continuously missing the point. It’s exhausting, boring, and goes against HN guidelines about fostering a curious conversation.
> been buoyed by government contracts, subsidies, and borderline crony-capitalism
The government pays spacex to complete contracts. They pay tens of thousands of companies the same way - defence, bridges, trains, roads, etc. in fact, every government does this.
It’s also worth pointing out spacex have completed those contracts much cheaper than competitors who have not delivered (ie star liner). As far as the gov giving out contracts for space stuff, spacex are literally the best option, and directly save taxpayers money.
Tesla gets subsided because the government wants to encourage EVs. Oil extraction and refining, corn, education, healthcare, defence and literally thousands of other sectors are also heavily subsidized. Again, every government in the world does this for sectors they want to encourage.
You are so hell bent on your “Musk bad” line you didn’t realize it has nothing to do with him or his companies. You are angry at how governments around the world pay for and subsidizes sectors every single day.
No, the Commercial Crew Program is fundamentally different than the way NASA has previously done business. They are buying a ride, not a rocket. Because it’s a service contract, it’s much more hands-off.
We agree the government supports sectors they want to encourage. See my previous comments about supporting high-risk nascent industries. That’s a different point than the one I was making, which is that support is a large part why those industries can exist during their initial high risk phase. My point is he is not a paragon of free-market capitalism because they rely on government support during high-risk stages. Both points can coexist. It also doesn’t imply I think he is “bad”.
You are trying to shoehorn a different discussion. I’ve never said Musk is bad. In fact, I’ve said he’s a once in a generation entrepreneur and that his companies have delivered wonderful things to the taxpayer. My claim is that his success is not the free-market ideal because it relies on government largesse. In your head, you appear to view it through a completely different lens because you seem to want to construct this “good vs bad” false narrative. The fact that you are bypassing the points reiterated multiple times isn’t conducive to a curious, nuanced, and thoughtful discussion
You still missed the point because you want to force this into a “SpaceX vs Everybody” narrative. I’ve already addressed the Boeing point. It still doesn’t negate the point about the industry needing government help/contracts to survive its early stages.
I don’t know why it’s difficult to actually read and critique the point being made, rather than constant digressions into others, but it makes for boring conversation. If you have a point that SpaceX didn’t need government contracts early, then make it. I’d be curious to hear it, but I don’t think the data supports it.
What part of defence contractors or train line builders or oil refineries or corn or sugar growers didn’t need government contracts and subsidies early?
You’re making out like SpaceX are doing something unique or morally wrong, when what they are doing is perfectly common, and the government couldn’t function without companies doing what spacex are doing.
Your message makes no sense. This is everyday stuff across the entire economy.
The only story Is that spacex saved the government (taxpayers) billions compared to paying Boeing who can’t even deliver.
Also show me when I say SpaceX was doing something unique or morally wrong. Was it when I said other contractors do the same? Was it when I pointed out Boeing’s shortcomings? How any when I said SpaceX has done wonderful things for the taxpayer? Or how the public-private partnership works well?
Why do you insist on ignoring all the things we seem to agree on to fabricate an argument? Is it because you are incapable of admitting sometimes the government does good things? You are tilting at windmills, my friend.
It’s all there in the OP. But since reading comprehension seemed to take a hit due to the need for arguing, I’ll reiterate:
His high-risk bets have largely been buoyed by government contracts
SpaceX wouldn’t have survived without govt intervention. I think the same can be said of Tesla to a lesser extent. That’s not bad, it’s the way things work with high-risk nascent industries.
No. It's blindingly obvious. You can be utterly incredible at delegation. You can be incredibly productive. You can also be utterly nuts. The utterly nuts part is self-evident to people who aren't temporarily impoverished billionaires and don't want to kiss his ass and be him. In my experience, that tends to include people who need it "explained". No disrespect.
What are you talking about? How about you spend like 2min doing research? Tesla solar roofs exist and are being deployed. Its just not the extreme growth market that Musk hopped for. And the trucks exist too.
The private moon mission is off because the costumer pulled out. But Starship is still in development and is contract with NASA for a moon mission.
Aren't Cyber trucks by Tesla? And FSD is basically here which means robotaxis are basically here. Now there are just regulatory hurdles and the long tail.
"""“I feel very confident predicting autonomous robo taxis for Tesla by next year. Not in all jurisdictions, because we won’t have regulatory approval everywhere. But we will have regulatory approval at least at some point next year,” Musk said toward the end of the presentation. “From our standpoint, if you fast forward a year, maybe a year in three months, but next year for sure, we will have over a million robo taxis on the road.”""" - Musk, April 2019
GP is referring to Tesla's promise to build electric semi trucks, not the pickup truck that Cybertruck is.
> And FSD is basically here which means robotaxis are basically here. Now there are just regulatory hurdles and the long tail.
AIUI, Tesla FSD is at best Level 3 automation (probably more like Level 2), which means it requires constant driver supervision to keep the car from committing suicide. That's pretty far from being "basically here", especially since Tesla seems extremely loth to accept any responsibility for FSD-related crashes.
In what sense of the word "basically" are the FSD and robotaxis "basically" here? Tesla FSD is a level 2 autonomic system that requires constant supervision, robotaxis would require level 4/5 autonomy. That's not even close to becoming reality.
"Basically here" and "actually here" tend to be decades apart ... especially in Musks case. Tho, I think another company can be actually capable to make them actually working.
Quite a claim. FSD in practice is nowhere close to actually being able to do robotaxi operations. So its not really a regulatory burden, other then regulatory actually checking if it works.
Exactly why do you believe a court that does exactly this kind of judgement all the time is not capable of it?
They issued a 127 page supporting decision on why they found it was a fair process that generated a fair price.
Want to say which part you take issue with that shows it was not capable of the judgement?
FWIW - I actually hate tesla, i just also hate the sort of drive by shitting on other fields that HN seems to do sometimes. If there are concrete reasons to believe they aren't capable, let's have that discussion. Otherwise, there's no need to denigrate others capabilities without evidence based on our feelings :)
you hate the company or the product? How does someone hate a company the open sourced all of their patents which resulted in creating a ton of competition in a previously dominated market?
Some people don't ignore the fraud, the terrible working conditions, the anti-competitive business practices, the unfulfilled promises, the stock price manipulation, and the cult of personality of a highly controversial leader just because of a marketing stunt from more than a decade ago which even Elon admits was not altruistic.
I'm a fan of Tesla's patent strategy. However, calling it "open source" isn't strictly correct. Patents are only free to use as long as you also give Tesla rights to all your patents.
copy-left is referred to as open source and some even claim it's _more_ open source, but thanks for the information, I wasn't aware of the that detail.
edit: oh it's not copyleft, but specifically quid pro quo so tesla gives you their patents if you give them yours
A copy left style arrangement would require you to not enforce your patents against anyone who signs and upholds the agreement, not just with Tesla. If that was the case, I probably wouldn't have quibbled with the term "open source" being applied.
Quite the opposite. You were the one who brought up how many words they wrote, when we can just look at the glaringly obviously results which were there solar city failed.
I can just point to that huge failure that we can see right now.
They are, but in the relevant Delaware law the latter point matters when there is a potential conflict of interest, so the Delaware court ruled on that.
The "fair price" standard and ruling is about both the process and the price. And the standard is likely not what most people would assume it to be, particularly as stated by the OP, resting on matters such as "was and is the transaction synergistic to Tesla?" It's also notable that the court found several process flaws created by Musk but ultimately determined the Tesla board was independent enough that it was likely fair.
Was it actually fair as evaluated by any outsider on first principles? Probably not. Was it criminally unfair? No.
It wasn’t a criminal case, and plaintiffs didn’t need to meet a high burden of proof. And Delaware’s entire fairness standard is a two-prong test that includes both fair dealing and fair price: https://en.wikipedia.org/wiki/Weinberger_v._UOP,_Inc.
The court ruled:
> Even assuming (without deciding) that Elon was Tesla’s controlling stockholder, the Tesla Board was conflicted, and the vote of the majority Tesla’s minority stockholders approving the Acquisition did not trigger business judgment review, such that entire fairness is the standard of review, the persuasive evidence reveals that the Acquisition was entirely fair…
> Equally if not more important, the preponderance of the evidence reveals that Tesla paid a fair price—SolarCity was, at a minimum, worth what Tesla paid for it, and the Acquisition otherwise was highly beneficial to Tesla. Indeed, the Acquisition marked a vital step forward for a company that had for years made clear to the market and its stockholders that it intended to expand from an electric car manufacturer to an alternative energy company. The Court’s verdict, therefore, is for the defense.
"The court made 11 factual findings showing that Musk had participated in the deal process to a degree greater than he should have."
"The trial court noted that these “process flaws flow[ed] principally from [Musk’s] apparent inability to acknowledge his clear conflict of interest and separate himself from Tesla’s consideration of the Acquisition."
"Upon recognizing these process flaws, the court then turned to what it identified as the strengths. It found six."
"Regarding fair dealing, the trial court noted that the road leading to the Acquisition was not entirely smooth. The court found, however,that the “Tesla Board meaningfully vetted the Acquisition” and Musk “did not impede the Tesla Board’s pursuit of a fair price.”Although Appellants assert that the court failed to make a finding of fair dealing, the court’s opinion can only reasonably be read and understood as concluding that the flaws did not overcome the findings of the process strengths and that the process, overall, was the product of fair dealing."
What’s that got to do with the court’s ruling that Tesla paid a fair price, which is what I said in my OP? This is the relevant part of the opinion:
> In instances where there are process infirmities, the Court is obliged to study fair price even more carefully. I have done that here. After careful consideration, I am persuaded Elon presented credible evidence that Tesla paid a fair price for SolarCity. Plaintiffs answered by proffering incredible testimony that SolarCity was insolvent, and then provided some “also ran” theories on value that their experts did not ultimately endorse, or at least not persuasively so. Given this, I have no credible basis in the evidence to conclude that a “fairer price” was available, and therefore, no basis to conclude that the price paid was not entirely fair. Indeed, the price was, in my view, not “near the low end of a range of fairness,” but “entirely” fair in the truest sense of the word.
The ruling is based on price _and_ process by your own reference. You keep moving the goalposts. Which end do you want to play from? I thought not burying the lede was the scheme here?
Regardless of the faith you have in the courts assessment time has shown the more critical opinion to be true. Solar City was a dead company, none of the promises they made has amounted to anything, they aren’t producing any products or revenue, and the deal has been shown to be self dealing in order to bail out his brother.
Where are the solar roof tiles? What’s happened to the tax payer funded factory in NY?
Grandparent is not correct, you can’t just assign “whatever” value in self-dealing transactions.
The SEC and IRS weren’t born yesterday. It reminds me of people who come up with basic self-dealing transactions with some tax benefit and act like the idea wasn’t around 100 years ago and that regulations aren’t already in place.
Surely a theoretically disgruntled xAI shareholder is going to have a harder time here since they're both private companies and given Elon's proximity to any potential regulators.
Company directors are generally given wide latitude in what they can do without breaching fiduciary duty, so such lawsuits were always going to be an uphill battle.
> I have no idea what corporate law is like in Texas.
Nobody does, really. Texas is relatively new to its 'corporate registration friendly' game, and at least on paper the statutory law is the same. Texas courts don't have to follow Delaware's case history, but it's also not a given that they will rule in a vastly more owner-friendly manner.
Private companies buying private companies is not heavily scrutinized in general by states, even in Delaware, especially non-public deals with no antitrust issues. The primary risk is stakeholders going through a state court if the company didn't follow standard rules.
No X shareholder in their right mind will object to getting a $45 billion valuation (including debt) when their latest valuations have the company at <$10 billion.
I don't think there are that many of them, and I think most of them are very much under the "Musk" spell. This would be the party to sue to block this deal, and it seems unlikely that they will.
Twitter still has a lot of users and if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably. Now that's all gone because Twitter could investors need w own a small piece of the giant over inflated Xai, which has value because of AI hype but it's future actual value is questionable. There are so many other AI companies, so what is it that xai can do that justifies an $80 billion valuation?
> if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably.
That's a big if, and I think most people would be pretty skeptical of the possibility of that happening. The fact that outside investors seem to value it at under $10B suggests that's a common enough opinion.
To me, "make money" only implies financial sustainability. Do you take it to mean unicorn levels of cash?
I had an employer taken over by PE and shredded, for the crime of only managing 10% profit margin. Apparently, to some, if 20% of revenue doesn't go into someone's pocket, your business is a corpse. I think the world needs to chuck that attitude in the bin.
Opportunity cost is what the business can earn by investing in something else, usually something less risky than what the business is doing. If the business cannot earn more than the opportunity cost, it's a losing investment.
Businesses often use an opportunity cost of around 14%, so if the business is earning only 10%, then they are losing 4%.
For example, if you start a risky venture that earns 2%, when you could invest the money safely in bonds at 5%, it doesn't make sense to do the risky venture.
It's not an "attitude", it's maximizing the use of the money.
Understood. But what you have described is an attitude. Another possible attitude is being happy to lose money, hand over fist. Somewhere in between, there used to be a multi-billion company that made a piffling 10% margin on revenue.
You need some diversity in a system to remain able to change. Very homogenous populations are more likely to be wiped out in a crisis. Maximal efficiency is not maximal meta-efficiency.
This thinking by American business is why tariffs will never bring back whole sectors of manufacturing to US shores. It's not business American companies want to get involved with.
'if you start a ̶r̶i̶s̶k̶y̶ venture that earns 2%, when you could invest the money safely in bonds at 5%'
The US invented flat screen technology. The return on manufacturing didn't fit American business profit levels so they sold the technology off to overseas companies. Tariff's aren't going to fix that. They might artificially boost the return short term, but unless we are going permanent protected markets this sort of low return manufacturing isn't coming back, because of American management style, not 'Canada bad', not 'trade deals bad'. If anything a better cause statement would be to say 'American MBAs bad'.
The discussion way back when they interviewed executives about LCD patents/research being sold of was that they were just too low of a profit margin to bother pursuing. I believe it was a 60 Minutes piece but it may have been a nightly news piece at the time.
If business costs are lower offshore, that raises the profit margin for the busines to go there. It doesn't mean that offshore businesses accept lower margins.
Well: with the exception of Q1 2020 they were profitable from 2017 until Musk bought the company. Their last year was lower due to a lawsuit settlement but they were making significant profits until his acquisition added huge debt service obligations and tanked revenue.
Yes, like a lot of tech companies they weren’t focused on profits until their CEO prioritized it over growth but from that point on they were profitable from 2018 on, with the aforementioned bad quarter when everyone cut spending at the start of the pandemic. The one-time deferred lawsuit payout in 2021 masked what otherwise would have been several hundreds of millions in profit.
The problem people had understanding them was that they weren’t Facebook or Google. The expectations of a money-printing machine were unrealistic but they had a solid middle-tier business with a large number of solid customers.
Actually I think that's a great observation! I hadn't thought of that one. But Facebook, open AI, Google, Microsoft have even more money than musk and I'm sure they wont allow that.
X is now state-sponsored media, not social media. it provides political echochamber for some portion of the population and nothing more than that any longer
the one way you can look at $45bn is ability to buy election(s). as long as there are enough sheep orbiting that platform the value is there - in buying election(s)
Well, I would have suggested that you put your money where your mouth is and buy out Fidelity et al, but it looks like you're off the hook for that statement.
However, secondary markets for these megacorps are relatively liquid, so the valuations are not actually completely baseless.
"Surely a theoretically disgruntled xAI shareholder"
they know what they buying when elon promotes his lmao, elon twitter deal is backed by saudi. elon himself come to saudi asking for an investment from royal prince saudi
safe to say that if they want spent 40 billion for twitter, they would spent more with AI flavored company (they are saudi after all)
The only way to determine fair market value is by having a free market sale.
For example, I had a run-in with the property tax assessor. He assessed my house at an unreasonably high price. I filed a protest, and then had a conversation with him. I offered to sell him the house at a considerably lower price, and he could then flip it for what he assessed it at.
He refused.
I eventually did sell it, for considerably less than the assessed value.
As anyone following stocks knows, the fair market value of a company can vary dramatically minute by minute.
The solar city acquisition was for "only" $2.6 billion. This deal is way bigger. I'm not sure what the Tesla valuation was at the time of that deal, but I have to imagine it's proportionally way bigger too. A $45 billion acquisition when the acquirer, xAI, has an $80 billion valuation will threaten the integrity of xAI. Particularly because that's just a paper valuation and xAI doesn't have much of any revenue.
If I were an investor in xAI I would be furious about this. They're almost certainly overpaying for Twitter and there's definitely going to be litigation.
Edit: It sounds like the combined entity is taking on Twitter's $12 billion of debt from when it originally went private. As of last December xAI had raised "more than $12 billion" in total [1], so the deal attaches Twitter's debt to that ~12 billion pot of VC money. Unless I'm really misunderstanding something this deal looks like a bailout of Twitter and a huge new liability for xAI.
It's definitely possible my hot take is wrong and the xAI investors support the transaction. I hope so because if not there's going to be some brutal lawsuits over this.
As best I can tell the deal includes paying off $12 billion of Twitter debt. So that's real money, though that seems like it's basically all of the cash that xAI has raised, so if that's the case that's pretty wild.
Edit: I misread, Musk said it's an all-stock deal, so you're right, it's all funny money. I think that means the combined entity is taking on that debt. It's still great for Twitter and bad for xAI investors because the combined entity now has both the $12 billion debt and all the VC xAI raised.
Every time I see deals like this that are going to be such raw deals for the majority of those who invested it feels like a keen reminder that all the talk of market efficiency the pro caps in Washington talk about are full of it
This is a terrible and inefficient use of money. It’s inevitable that this paper house will fall over
It's so hard to make predictions of Teslas value in today's political system! Musk is very very close to power, and it's impossible to say how that will play out. Will Tesla be the only car company without 25% tariffs? Will the government spend billions to buy Teslas? Or will Tesla die and Musk live of space-X?
Megacorp market valuations are extremely bizarre because they're in a sense self-fulfilling. If your company has a market cap in the hundreds of billions of dollars then it has lower capital costs than competitors. If you want to build another factory, you're paying less in interest. Which means you can undercut the competition on price, or expand into grid storage or data centers etc.
Obviously you then have to actually do those things before the value crashes, so whether it works or not depends on whether investors continue to expect you to.
The current value fluctuations have more to do with politics than the company. The media is writing a lot of negative stories right now, but they also have the attention span of a goldfish and ultimately some new Current Thing will replace the existing one.
Ahhh, I dunno, musk is pretty good at fucking his own companies with Nazi salutes and wreckless incompetent destruction. Doesn't really take any big bad media to see what a fucknut musk is.
The media is the thing that characterizes it as "Nazi salutes" and "wreckless incompetent destruction".
The guy is an eccentric with autism, not an angel or the devil. He's not always right. But everything is so polarized right now that people are barely willing to concede that it's possible for someone to be right some of the time.
Teslas have the positive characteristics that they don't run on petroleum and have good safety ratings. They have the negative characteristics that they have privacy issues and you can't get parts or documentation to fix them yourself. A strong heuristic to tell if someone is using motivated reasoning is if the thing they're complaining about is an unrelated political hot button well-known to produce outrage (e.g. allegations of somehow simultaneously secret and open fascist ideology) as opposed to a way they're actually screwing someone illegitimately but in a way that doesn't cause most people to experience an immediate visceral response (e.g. mass surveillance, right to repair).
You can also tell it's that when the target is actually doing a bad thing, but the people objecting only care about the target and not anyone else doing the same thing. This is extremely common with corruption allegations. All corruption is bad, you need systems in place to constrain government officials from bilking the taxpayer, but this is a process problem where you need stronger checks and balances to prevent the government from transferring money to cronies, not a "we need to somehow elect only infallible humans" problem where what people actually mean is that they just want their guy to get in so the money goes to their cronies instead.
Cool story buddy. But musk is still a Nazi salute throwing fuckwad fool. I'm not buying the smirking excuses. He also happens to control a company producing government subsidized garbage pail cars. And he lies about their self-driving capability... over and over and over again. Mainly because he was too big of a fool to recognize that multimodal sensors are a good thing so he's about half a decade behind.
I prefer cars that don't get recalled for glued on pieces falling off and CEOs that didn't pay a quarter billion dollars to buy a presidency.
Plenty of other electric cars being produced by the other manufacturers.
Definitely great for the Twitter investors to be able to convert. I think they took a haircut relative to the 42B that they came in on, as the 45B includes the 12B debt. (42 gets reduced to 33, so 21-22% haircut)
xAI also raised 6B in December last year at a 45B valuation, and then in February, reporting was that xAI was trying to raise 10B more at the 75B valuation... so this is where the frothiness of AI helps to mask the fundamentals. Can gets kicked down the road.
Definitely, and a lot of that haircut actually happened in between when the deal was signed and when it closed, too. That was right when interest rates went up and Musk tried to wriggle out of the purchase agreement. So it's a great outcome for Twitter investors, assuming it sticks.
Also - the wording on the deal:
xAI being valued at 80B
X being valued at 33B
Is the xAI 80B number inclusive of the 33B (45B including debt)?
That would back into xAI's valuation moving backwards since the December round.
Usually when venture-backed companies tout a valuation after a capital raise, it's post-money... and they're not chest-thumping a 113B number (which they surely would have given 9 figures)
I smell margin call desperation. Musk got visibly worried with tanking Tesla stock and pulled out some crazy stops to keep Tesla afloat.
Remember, these megabillionaires are due to stock valuations, and live rich lifestyles on the basis of lending against the value of stock. If that value drops and a margin call forces actual selling, then Musk loses shares in Tesla.
I have to think this stunt is related to Musk needing some liquidity somehow, or being unable to cover private liquidity crunch with public assets.
TSLA is ludicrously overvalued. P/E is 150, based on Q4 earnings which were 1/3 "real" revenue, 1/3 mark-to-market-BTC (aka one shot), 1/3 CAFE/subsidies which Trump will nuke in 6 months.
But the "real" earnings that were already flat in Q4 are seeing a huge drop in EU/CN and who knows in the US. If "real" revenue drops 20%, the "real" earnings might drop 70% or more.
Anyway, that 150 p/e is ACTUALLY 450 in my mind, but after Q1 reports it will ACTUALLY be almost 1000 or worse.
The only thing keeping the stock afloat is AI hype, but 1000 p/e ratios are for people with market dominance and fundamental leads on competitors. Tesla is arguably middle of the road in both self driving and robots.
People tend to only look at the drop from January until now, but if you look back a little further it seems clear that the market was expecting some payout from Musks relationship to Trump. When that's didn't really amounted to anything, the stock price just dropped down to it's September 2024 level and continued from there, as if October - January didn't happen.
What surprises me is that the drop in sales numbers seems to have zero effect on the stock price, at least not yet.
I was trying to stay apolitical but a CEO doing Nazi salute and not being fired is uncharted waters, at least in the last 80-85 years.
I keep going back to the horsemeat episodes on mad men, and the papa johns CEO getting booted. This is simply unprecedented in brand management. Brands take decades to build, and are especially important for car companies.
He had a sizable chunk of collateralized borrowings against his Tesla shares even before the Twitter acquisition. There was the risk of a margin call during year following the acquisition, but AI became the latest hotness so he was able to spin up a company to cook up some more market bubble.
Sort of: it put Twitter's LBO debt on X.ai's books. I strongly suspect Elon had been lending X money to cover interest payments. Both X.ai and X are privately held, so specifics will be hard to come by.
This doesn’t strike me as an objective assessment of the state of affairs.
You could make the same “bleeding money” comment about many historical social media acquisitions – at least Twitter has advertising and subscription revenue. And it’s similarly suspect to argue that xAI is failing due to lack of revenue, without mentioning the astronomical valuations of its peers in the AI space, many of which are not only lacking revenue but also have no distribution channel comparable to the scale of Twitter/X.
xAI has one of the leading models in terms of investment and user base, and it’s rapidly improving on its evaluation metrics.
Twitter/X is one of the Top 10, if not Top 5, social media properties worldwide. It has hundreds of millions of monthly active users and maintains the lead in public consciousness as the “go to” place for 1-N broadcasting of information. While Bluesky shows promise, it won’t be dethroning Twitter any time soon. When has Bluesky been the source of breaking news?
And you cannot separate these two businesses. Twitter/X and X.ai are fundamentally coupled to one another. Twitter is not only a data source for X.ai but also a distribution and retention channel. There is an “ask Grok” button under every Tweet. And it’s not the only LLM that can be summoned via Tweet – with similar automations from companies like Perplexity proving there is value in the channel – but it is the only LLM with a native integration into the interface and first dibs on freshly-generated user content and breaking news.
You're missing the fact that Twitter has essentially 0 advertising revenue compared to the other major social networks, as all major ad networks have stopped doing business with Twitter (this in turn being because of the very high likelihood that their ads would be shown next to content that their clients didn't want to be associated with, such as images of Hitler).
We already have multiple news stories about xAI receiving 10,000s of GPUs that were originally meant for Tesla. That's about as close to "public company giving private company owned by CEO money" as you could possibly get without cartoon sacks of cash.
> Even by Tesla & Musk lawlessness standard that would be too wild.
Not to be overly snarky here, but, uh: what standard? They have proven over and over that they could not give less of a shit about either societal norms or the laws of the nation.
Stock market graveyards are full of people that shorted TSLA. I remember reading about people who lost it all because of a TSLA short at least since 2020. The lesson here is that markets can remain irrational longer than we can remain solvent.
In those cases, it usually revolved around Tesla releasing either the Model 3 or Y, and they were betting against Musk's execution in general. What wasn't really up for debate (in my mind) was the technological lead or the demand in the marketplace for the car.
Essentially, Tesla was primed in both situations for a huge market they had to themselves: electrified transport.
Now?
- demand is tanking, and the brand is permanently damaged, well, as long as Musk is at the helm.
- competitors are everywhere
- technological moat (with respect to EV drivetrain/construction) is gone. I could argue their cylindrical cells are legacy/semi-obsolete in fact, since IMO pouch cells are superior for LFP/sodium ion, and who knows what solid state will optimally package.
There is also the "first buddy" benefit. The whole thing is being actively rebuilt at a time when Musk has been heading a department which, amongst other things, openly backdoored the treasury. It's pretty uncharted waters.
> The entire stack is based on TSLA valuation, which is going to tank.
But it's not is it. Try looking at the trends long term, not just YTD. It's remarkably stable, trending upwards. Yes it gain a bunch of value from October to January/February, which is has lost. Investors seems to have traded on the "First Buddy" effect, that didn't actually do anything for Tesla, so that value has now been removed and we're back on the original trend line.
How the hell drop in sales and lose of brand value hasn't caused to stock to absolutely tank is beyond me. Is someone artificially keeping the price stable? Do investors see something I don't, or they do just not care?
Yep, I also believe that we will have a Minsky Moment on the entire Muskonomy.
Given his political involvement, I would assume that the maximum end date for this house of cards is the date when Trump is no longer in power - which is less than 4 years away. The real date is probably much sooner, but who knows when ?
But that then means that Musk has a strong incentive to keep Trump (or some replacement that will similarly let him do whatever he wants) in power past these 4 years.
Buying time to get the rocket finished that he will ride escaping his creditors to Mars. That would be a badly written plot even by the standard of cheesy comic books, but somehow it all makes sense from that angle. (no, I don't believe that he would ever get within explosion range of a rocket engine ignition)
No, Tesla has their own seperate training supercomputer called Dojo that it optimized for computer vision. Its one of the top 20 supercomputers in the world by compute.
That’s all marketing. They have had lots of issues getting it put together and working, and is more akin to really really really self driving in 2018 we were told.
Mmh, that source is showing a 10% drop in users for September 2023 the last point, which was notably before alternatives like bluesky and others were starting off. Also note that since Musk took the company private we don't really know how accurate these numbers are.
So I'd argue that the statement theat Twitter/X is bleeding users can't be conclusively decided, but it seems your statement that Twitter has been growing globally is incorrect at least for the last reported quarter.
Fair enough, edited to just revenue. But those are just datacenters bought with VC money - my intent was to say that xAI's resources are basically just the investment they've received.
We don't know that it's a world class data center, we only know how many GPUs they bought. For all we know, half of them could be staying on shelvez, and the whole data center could run for 5 hours a day: there's no public info on how well they're doing.
xAI is a private company. I very much doubt that the current VC investors will ever litigate this.
They are all waiting for some other favour for taking this on either explicitly or implicitly.
Also, I would like to see a Venn diagram of the investors in xAI and SpaceX.
Solar City was a debacle, it died immediately. Tesla's story in court was they were about to go bankrupt, and it was a financial necessity to redeploy all Solar City assets, including all employees, to Model 3 production.
It breaks my heart because my rust belt hometown got a substantial investment from the state they had been chasing for a couple decades.
$700M of the Buffalo Billion went to a Solar City facility, Elon even said they were going to build the solar roofs there!
New York State didn't dare pick a fight with him as the factory set empty for years.
That wasn’t the claim. They just speculated that acquiring one solar company helped in their other solar ventures, which seems like a good default assumption.
If you have evidence that’s not the case, that would be interesting to share.
I wrote a comment 2 hours before the initial comment in this subthread that explains Tesla held in court that Solar City ended up contributing nothing because it needed to be liquidated immediately lest Tesla go bankrupt. https://www.vanityfair.com/news/2019/08/how-elon-musk-gamble...
For what it's worth, I don't even know what the inverse position would be, SolarCity was a solar panel maker, and famously, the idea after they realized they couldn't come close to China's prices, was solar roof tiles. They would be a major breakthrough project that would make Solar City a breakout financial hit.
Do people think Tesla makes solar panels? Solar roofs?
I don't blame them, I guess, this carnival has been going on for years.
I'm somewhat surprised how dedicated you are to avoiding information and asking for someone, anyone, to give info. It's been 18 hours and 3 replies on your end, albeit without people taking the time to spell it out to you like this. Personally, I would have looked into it a bit myself.
I don't think that's the true at all. There's a vast and visible footprint we can see with batteries (pretty sure every major solar company in the U.S. that has a battery storage option does at least some Tesla) that has no equivalent with solar rooftops. The former are ubiquitous while the latter are so far as I can tell almost entirely non existent.
And if that's too light on data I'll put it this way, I'm reasonably confident I can find 10 solar companies that install Tesla batteries for every one that does Solar City roofs.
Exactly, and theres plenty of third party companies buying and installing these for customers and their economic activity testifies to the significant scale of the Tesla battery business.
Because Tesla abandoned the SolarCity model? Like, SolarCity was a bunch of sales people going door-to-door to sell questionable leases on solar systems and hawking off the junk bonds resulting.
I’m curious what the cumulative operating cost / financial repayment plan is relative to the capital installation cost. Funny enough if it is advantageous to you vs solar city that is one more argument in favor of them running a poor business model.
The general model has some intrinsic advantages. If you want to build out solar generation you normally have to buy land (expensive), but this way the customer is giving you space on their roof "for free". Then the price per kWh the customer pays to the power company includes a transmission cost, but the power is being consumed on site so you don't have to pay that.
The result is that solar generally has a generation cost of ~$0.04/kWh (which includes the cost of the land) but meanwhile you have customers happy to be paying $0.11/kWh. The trade off is the one-time cost of installing it on individual roofs is more labor intensive than doing a large-scale installation in a field somewhere, but that just means it's competitive rather than having a massive advantage.
> Exactly. So then why draw conclusions about how SolarCity was a bad deal for shareholders (see parent comments)?
You can absolutely draw adverse inferences from Tesla's refusal to report certain straightforward, useful numbers. For example, their refusal to publish any real safety statistics, to the point where Elon Musk himself has to invoke rubbish numbers like the 'community tracker'.
If, after all the lawsuits and accusations of failure, and the reporting about the near-zero deliveries and idled factories, the Tesla Energy division is giving you no numbers on the solar roof, and is lumping them together with a totally different product like batteries, there is one thing and only one thing that that means: the numbers are awful.
Putting aside the fact that you can't justify fraud by post-hoc outcomes (Shkreli and SBF also claimed that they didn't commit fraud because they would or did win it back), I doubt any of the Tesla Energy division income (even assuming the accounting is okay) is a result of businesses that can be traced back to Solar City.
I suspect most of the business is battery storage and the Powerwall was introduced by Tesla before the acquisition.
The vertically integrated Tesla strategy is to use batteries to arbitrage the value of stored energy. This is well described in the Tesla "Master Plan" documents. Solar is a huge part of this.
According to the company filings the solar assets Tesla acquired are still generating revenue at the rates projected during the acquisition.
Well I trust Elon's statements (even the financial statements) as far as I can throw them but can you point out where it says that? I'm searching the 10-K and I don't see solar broken out.
But even if it's true I assume they are including their utility-scale solar and battery packs, which has nothing to do with Solar City: the panels are generic, the customer lists are not residential, they don't use the fancy shingles. Solar City did not help them in any way with these getting or fulfilling these contracts.
So what, Tesla energy is a separate division? Tesla solar products are basically dying in the solar roof failed. It's a great idea, who wouldn't want to buy it if it lasted and was practical.
You can sell your house to a family member for $1. (There might be tax implications if you sell a $100,000 property for $1 to avoid gift tax limits or whatever, but that’s a separate issue.) I sold my car to my sister in law for $1.
Self dealing is also permissible with companies. Corporate officers and directors must still meet their fiduciary duties to shareholders. And the potential for conflict of interest changes how courts will evaluate the transaction if a shareholder complains about a breach of fiduciary duties. Ordinarily, in Delaware, operate transactions are protected by the “business judgment rule” that gives wide latitude to corporate officers and directors. https://plusblog.org/2023/11/28/the-business-judgement-rule-.... But if there is self dealing, courts will scrutinize the actual fairness of the transaction. But self dealing isn’t per se impermissible.
Sales tax was already paid when it was new, the state got its due. That kind of idiotic policy is how expensive and collector cars get owned under an LLC and the LLC changes hands rather than the title. Thus the rich bypass all that BS it's only for the gullible plebs.
> I can’t sell my family member my house for $1 for example
In most countries you absolutely can. The difference between market value and the sale price might be considered and taxed as a gift, but such a deal is generally not prohibited.
Yes, self-dealing is illegal when taken to mean a precise legal term; a fiduciary using that position to carry out a transaction in their own self-interest and against the interests of their beneficiaries.
Yes, and just like anti-trust law doesn’t make monopolies illegal, it’s not the self-dealing that’s illegal, it’s the abuse of the process (as you say).
Obviously you can sell house for $1 to a family member, this will not help to avoid taxes though, as tax office for taxing purposes evaluates value of the house independently.
I know for certain that in Virginia you can sell a house for any price you want, because I transferred one to a family member for zero. Of course the county's assessor had other ideas about the value for tax purposes, but the official deed was recorded at $0.
My guess is that there's an added grift, er...benefit here; since the federal government is now (apparently) in the business of subsidizing AI companies, we'll effectively see the failing social media platform get subsidized by the federal government.
I'm certain we'll see a pile of public funds handed over the xAI in the future.
The government spends 1 out every 5 dollars of GDP. It probably does need a better mechanism for managing costs and outlays. Having one of the "richest men in the world" be in charge of it is ridiculous.
That's Trump for you. Populism up front, oligarchy in the back.
Oligarchy is generally how people who don't deserve wealth can get it. As pointed out by you, that doesn't exactly apply to the world's (already) richest man.
And who exactly would you look for to help the federal government build "a better mechanism for managing costs and outlays", if not someone who has built multiple successful businesses (managing costs and outlays at impressive scale) in very different industries?
> Oligarchy is generally how people who don't deserve wealth can get it.
No that's just one of it's outcomes. The proper definition would be "a small group of people having control of a country, organization, or institution."
> that doesn't exactly apply to the world's (already) richest man.
Given the appropriate definition and his involvement in owning not only a social media company but also having a role in federal government policy and now apparently investigations I am completely baffled by your assertion.
> And who exactly would you look for to help the federal government build
I figured someone would summon this fallacy. He has acquired wealth. This does not demonstrate any skill in spending tax payer money efficiently in a regulated environment. This is particularly true if you're willing to assume that oligarchy played some part in his acquisition in the first place.
> if not someone who has built multiple successful businesses
He likes to call himself a founder. Of business that already existed and he purchases a controlling share in. It's amazing that people accept this distortion of reality.
> managing costs and outlays at impressive scale
Presumably he has people on the payroll who do this. I imagine that the entire financial success of these companies is not down to a single person. How does he find time to do anything in a day?
I imagine the federal government could, you know, just do the same thing. Hire qualified professionals to do the job?
> Not sure that tracks.
Outside of the reality distortion field that some people willingly occupy it most certainly does.
Yes, I stated it as an outcome. I was not defining oligarchy. I was responding to a comment which was stating that Elon Musk becoming involved in the USG apparently makes it an oligarchy, and that this has something to do with this personal pre-existing wealth.
The govt isn’t a business. Do you really want the list of people who would be better than Elon fucking Musk? It would take forever. This has the same energy as believing what Doge says because they have a simple table saying so
Could you give a broad outline of how you'd make this list? The government is currently not run efficiently, so clearly we can't rely on people who already have lots of government experience, because that just means they've been doing a poor job for a long time?
Yeah it is more profitable but revenues are way down.
In 2021, the last full year before Musk's acquisition, Twitter generated $5.08 billion in revenue.
Under Musk's ownership, X's revenue has declined significantly. In 2024, X reported $2.7 billion in revenue, which is nearly half of its pre-acquisition level. For 2025, global ad revenue is projected to grow to $2.26 billion, marking its first annual increase since the acquisition.
So yes on paper, X is more profitable than Twitter was before the acquisition. Its 2024 adjusted EBITDA nearly doubled Twitter’s best year, despite a much smaller revenue base. But whether that profitability is sustainable or comes at too high a cost—strategically, reputationally, and culturally—remains an open question.
Beyond the valuation, I think there's 3 things that are interesting to think about:
1. Musk owned an estimated 80% of X and an estimated 50% of xAI [1]. We don't know the specifics of the deal, but we do know it's an all-stock deal, so in theory this should help Musk own more of xAI, which sounds like better-performing and more promising company atm.
2. Tesla has been a big name in AI for a while now, but has been awfully MIA when it comes to generative AI. It's always focused most on vision, sure, but it's not hard to see how other types of AI could fit it's strategy.
Imagine a conversational virtual assistant in your car, or in their robots, or the possible manufacturing applications. In my opinion the device manufacturer + AI lab combo, especially for a device that sells on its promise of cutting-edge technology, makes more sense social network/LLM combo. Beyond the product applications Tesla would greatly benefit from the prestige and marketing of cutting-edge AI.
Nonetheless Musk owns only about 12% of Tesla [2]. It makes more sense for Musk's fortune to ride the wave of this new industry with a private venture he owns. This 12% ownership is down from 22% in 2018 btw [3], before the Twitter acquisition in 2022, which was largely funded by liquidating his Tesla stock [4]. Musk seems to be very much divesting from Tesla— both in effort and in money.
3. Where does this leave Musk, Tesla, and xAI?
- I think it leaves xAI in the position of being the most important company for Musk right now. Best-case, it becomes a "big tech" company. I'm sure we'll keep hearing much more about it, although I don't rule that Musk could try to sell it or merge it if it gives him control of a tech company with a solid business model or strategic importance.
- Musk I think is definitely in a better position than before, fortune and power-wise. He's been diversifying away from a company that's had an insane PE ratio for a while [5], but most importantly, he's been doing so in a pretty smart way. If he had just sold Tesla to buy government bonds, the share price would've crashed. Instead everyone buys into the "he's eccentric and went through a divorce" story. Social network ownership has given him plenty of political power— I don't doubt unbanning Donald Trump is how he got close to him the first place. And now he's converted imaginary wealth from unattainable hype at Tesla into ownership of private company riding the hot tech wave of the moment, concrete political power and self-regulation via his seat in government, and evergreen influence/relevance via his own social network— a tech baron's dream.
- Tesla is not doing great, and Tesla investors are the ones getting the short end of all this. I think Musk realized self-driving is too hard, be it due to tech or regulation. I think he realized he can't compete vs Chinese automakers. I think he's pumping and dumping. If he can get a good deal he might try to merge it with xAI in a way that offers him full control of the company (maybe even private ownership), but otherwise I think Musk is ready to let go of it. He's used its insane valuation to get himself better assets.
In similar news: my left hand acquired my right hand today in an all stock deal valuing the combined hands at $1T. Praising the announcement my arms noted on the deal: “With these two hands now together, there’s nothing our combined fist of might can’t do.” Competitors, my left and right feet, declined to comment on the merger but are said to be in their own separate talks about a deal.
right but you don't have $1T to do that, whereas clearly he has however much money he's paid for it. it's a weird thing to do, but if he has the money to do it then meh?
In similar news: my left hand acquired my right hand today in an all stock deal valuing the combined hands at $250,000. Praising the announcement my arms noted on the deal: “With these two hands now together, there’s nothing our combined fist of might can’t do.” Competitors, my left and right feet, declined to comment on the merger but are said to be in their own separate talks about a deal.
it doesn't invalidate anything; my original point was that Musk has this much money, meaning that he's just moving money around, meaning that this pretentious analogy is not actually making any kind of insightful point whatsoever. what Musk is doing is taking two entities already with a high market value and then merging them, he's not just deciding randomly that 2 irrelevant things have value. how much money this guy has is irrelevant. it's just a shitty attempt at satire, which I cannot stand
The acquisition is entirely in stock. Shareholders of X are receiving xAI stock in exchange for their X shares. They don't get any cash.
Musk says the new combined entity is worth $80B, but that's on paper. The company certainly doesn't have that much cash or liquid assets. The valuation is based on xAI's previous funding round + whatever number they decided to assign to the X assets + the magic of "synergy" produced by this deal. In other words, it's not based on anything real. (Accountants call this "goodwill.")
right but those entities quite clearly have an existing market value in the region of those numbers. this guy's arms and legs do not. it's a poor analogy that's trying to be too clever
Maybe the guy is pretty good at basketball and sincerely thinks he’s going to be the best player in the world next year? That would make his arms and legs awfully valuable.
Musk’s xAI is in a similar place. It’s an also-ran in a crowded space and it’s not making any money while spending billions. But the founder certainly has great faith in it. Is $80B the right value to assign to that faith? Who knows.
X is "clearly" worth only $10 billion less than what Musk paid for Twitter back 2022? Really? Despite its revenue being 50% lower than it was back then?
As for xAI, Anthropic has a valuation of ~$60 billion. So again not that "clear". Of course they don't have Musk's political connections which might end up mattering quite a bit (of course there's also the risk of Musk being prosecuted in 4 years as well...)
first of all, Anthropic is hardly more successful than xAI. they get a lot of headlines, but how many people actually use Claude? and what else do they have going for them? as far as I've seen and heard Grok is just as successful if not more.
second of all, I would suggest that twitter's value as a whole is very nebulously related to its actual revenue numbers, and is far more related to: - its potential revenue numbers, which are way higher in the hands of someone less controversial and - profit, which we don't really know about because its private anyway, but is likely much higher given the amount of cuts that have been made.
> s I've seen and heard Grok is just as successful if not more.
Most of what I've seen about Grok were the various memes about people trying to trick it into saying stuff about Musk (or trying to expose the filters stopping it from saying bad things about him).
> its potential revenue numbers
Maybe. But it wasn't even that successful financial even in the pre Musk days compared to its competitors. Destroying the brand and reputation also had a non-insignficant impact.
> but is likely much higher
Twitter was barely or not at all profitable before the acquisition so that's not unlikely. Companies that have high net income but stagnant or decreasing revenue generally don't do that well in the stock market, though.
that's not how market values work and there's no such thing as a "true market value". my car has a market value, it not being for sale right now does not change that.
Your car is presumably not unique. Both the model and well... it probably does more or less exactly the same as any other car. If you had an entirely unique one of a kind antique car it would be pretty different.
Estimating "true market value" of companies whose valuation is almost entirely based on their potential long-term growth isn't particularly straightforward until you find a buyer willing to buy a significant or it does an IPO.
>Your car is presumably not unique. Both the model and well... it probably does more or less exactly the same as any other car. If you had an entirely unique one of a kind antique car it would be pretty different.
I fail to see how this is in any way whatsoever relevant. a unique car has a market value, and a non-unique car also has a market value. anything that can be sold has a market value. there's still no such thing as a "true market value"
Well not until you try to sell it and find a buyer.
I mean sure xAI does technically have a market value we just don't know what it is because there is no market that would allow us to determine it.
Of course the price paid by private investors do provide some estimate but a company .e.g. raising $5 billion at a valuation of $150 billions or something like doesn't necessarily have a market value which is that high.
Except there is no money involved. xAI has nowhere near that amount of money in cash or in any liquid assets. The valuation hardly means anything, it might be worth $10 billion, it might be worth $100 billion nobody can tell at this point.
So he just sold himself a company he already owns for a valuation that he himself assigned to that company but that was less than what he paid for it, and he paid entirely using “money” that has a made up value and which he issues himself?
This also lets all of his co-investors in X, who were likely pissed that their shares tanked, exchange their shares at an inflated value (but one that still sees them losing 25% of their original investment) for shares in a trendy yet likely overvalued AI company that they consider to have more upside.
The other part of this is that if TSLA stock drops to $100-ish he'll be at risk of being margin called on the loans he took against his holdings to buy X. I wouldn't be surprised if this deal involves some X shares being sold for cash (that was raised from VCs) to pay down those loans, and/or the lenders agreeing to take xAI stock in lieu of cash.
This whole thing seems like a big pyramid scheme. I don't think this is the last time we've seen this type of move: he'll keep starting companies that are at the forefront of whatever the current hype cycle is, then leverage the extremely inflated valuations to benefit himself.
> This whole thing seems like a big pyramid scheme.
That's because his scam of charging $8k over the price of a Tesla for "self driving" was complete vaporware. It never worked and it never was going to work. I am disappointed I fell for it.
There should be a class action lawsuit against TESLA for everyone that purchased the $8k self driving "feature". We were all told it was "being rolled out". It was a total lie.
You must not have tried FSD 13.x with AI4 hardware. I commute to work every day from the suburbs to the city with a ~25 min one-way commute with zero disengagements.
Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
Edit 2: To clarify, FSD 13.x is only available with AI4 hardware.
They started selling FSD back in like 2017 and it was supposed to be self-driving ALL THE TIME by 2019. It’s 8 years later now and the best you’ve got is “upgrade the hardware to version 4 and you can make a 25 mile commute without disengagement” when Tesla was promising cross-continent summoning so you could fly somewhere and your car would drive there to meet you, charging along the way. That’s L5 autonomy. The delta between promised and delivered is so far apart it’s ridiculous. Mercedes’ autonomous system is the only L3 even, Tesla’s is L2. They by my definition did not deliver whatsoever on their promises.
Another thing is a lot of people don’t even keep cars longer than 8 years (and people who are buying new, $100k electric cars are more likely going to upgrade sooner than someone who’s buying a $30k civic.) they paid for FSD thinking it would be ready soon.
I was intent on keeping my low-vin release day Model 3 until they made good on their FSD promise, come hell or high water. Then The Salute and The Infomercial happened, and I gave up and ditched the car like a psycho girlfriend. They got my money and I was fooled by a con. I'll never let that happen again.
I was replying to the "never was going to work" part
> It never worked and it never was going to work.
That is evidently false. If I had a longer commute it would work fine too. I have done ~2 hour road trips with it already.
You are bringing up a different point, which is that FSD arrived later than promised or at least implied (I don't know exactly how this was sold in 2017). That is self-evident at this point.
> Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
Unfortunately, that's because they were sued in court and lost when they tried to force people to buy the upgraded hardware in the past. Not because they stand behind their products.
I would not be comfortable using any self-driving system on US roads that only utilizes computer vision.
The reality is we don't actually know how reliable these systems are, and Tesla has a long history of spreading misinformation about their own technology and obfuscating the facts. We don't even know how many cars crash while in FSD mode. We don't know how they crash, or why. None of this data is made publicly available, and of the data that is shared it is carefully curated, and we have no guarantee the data is not fudged. For example, are we certain that FSD does not disengage itself in dangerous circumstances to skew statistics in it's favor?
Trusting Tesla marketing on the topic of Tesla products is like trusting any kind of marketing. They have an incentive to sell the car, so they will lie, and they will cheat.
> I am equally uncomfortable that other people are out there beta testing FSD.
That is probably because you are unaware how far it has gotten. Irrespective of that, a driver still needs to be there and pay attention. As soon as you take your eyes of the road for a few seconds it will warn you very prominently.
I'm going on the record here to say that FSD will be a better driver than 99% of humans in the next 2 years. I may be wrong, but I don't think I will be.
>Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
The outside investors in X made a profit on paper; Twitter was bought for $44B but the deal was financed with like $31B in equity and $13B in debt. It’s not a big profit (in fact it’s worse than you would have done in T-bills), and of course they’re swapping one illiquid and hard-to-value asset for another, but Elon isn’t giving them a 25% haircut at all.
They feel great, because he just magically turned a ~50% loss in Twitter into a ~50% return in xAI and a ~0% loss in Twitter.
Of course, you can't buy $20B worth of mangoes for $40B worth of Mango Holding Company stock and then suddenly make your mango-holding business worth twice as much money.
But you can pretend!
Private valuations, especially VC-funded companies, have been nonsense for decades. Elon is just exploiting that egregiously.
As the sibling pointed out, private companies don't have stock prices. But I've read estimates that Twitter is worth less $10B now, so less than a quarter what Musk paid for it.
The banks just recently did a debt sale of a lot of that debt close to list price, so 44 billion dollar valuation is probably reasonable. Apparently the company is profitable now, sans the debt, so as long as it doesn't go out of business and can grow on other fronts then it's probably not a problem.
Fidelty, which still owns a decent chunk of X, and is required by law to do due diligence on the value of that holding, and also has deeper insight into the value of X since they are also required to see X financials (since they own a big chunk of the private value), puts X value at 20% of the original 44B.
> Banks have completed the sale of $5.5 billion in debt for Elon Musk's X, according a Wednesday report by the Wall Street Journal. The debt offering was increased following a strong response from investors. Ultimately, the loans were sold at 97 cents on the dollar.
This is not the same, as no ownership was traded, but it signaled surprising confidence that the debt could be sold with only a small discount.
That does not value X at $44B as the poster claimed. It also states “ These floating-rate debts have an interest rate of around 11%, making the borrowing costs several percentage points higher than even the riskiest loans on Wall Street.” which is a spectacular admission the markets put X on incredibly shaky ground.
X being forced to sell off debt at such extraordinarily bad terms means X is likely about to implode.
What، acompany needs to cover the costs of how it was acquired, now? If it's valued at the price it was purchased and making a positive revenue stream then it is profitable.
3. Carry out weird financial/legal alchemy to make the victim company solely responsible for paying off the loan
4. If the victim company can’t handle the debt and goes bankrupt, then you don’t own the company any more. That’s sad. Especially for the people who lose their jobs. But the people you borrowed the cash from can’t chase you for it, so no harm done, eh?
5. If the victim company pays off all the debt, then congratulations: you bought a successful profitable company for free!
They need to cover their debts. If someone uses private equity raider tactics to load the company up with debt, it’s likely to be bad for the company but it still counts on their books just as taking payday loans is ill-advised but legal.
You can dress it up in "financial alchemy" like any hedge fund, but it doesn't disguise the fact that the last person to carry that can is going to lose a lot of very real money.
This makes no sense. The debt payments are larger than the company's entire revenue! The Twitter purchase was a financial boondoggle that Elon is attempting to hide with this latest deal.
If I borrow $4 million to buy a house worth $1 million I could technically say that sans the debt I'm a millionaire, but that's hardly a useful or positive claim.
Also I think Fidelity open puts out statements on the value of Twitter since they are a shareholder. The only recent info I can find on this was an article from last October:
Where it states that Twitter is now worth 1/5 of its $44billion price. I highly doubt it re-made up the equivalent value in the span of 6 months. If anything they likely lost more money as advertising sales have plummeted.
He's simply moving Twitter losses to xAI investors - because he's the largest Twitter loser - and would prefer those losses go to other patsies instead.
Again, you're just citing three things from the same date, and I don't believe it's in good faith.
Elsewhere I suggested people to just Google it, because it gives you an honest answer. So does chatGPT. So does the Wiki page on the deal, with sources.
How did he get the tens of billions in cash he personally put in if not leveraging Tesla. Yes he had minority investors and put some debt on the acquisition itself, but he put up a lot of money.
He had to sell some Tesla shares because he reached the max borrowing limit against his Tesla shares that was allowed. Once he was forced to sell shares he had to pay a lot in taxes. This shows the mega wealthy can pay taxes and not become poor. We should learn from this lesson and tax the .01% of society.
Elon Musk is limited to borrowing against pledged Tesla shares, with the total loan amount capped at the lesser of $3.5 billion or 25% of the value of the pledged shares. Musk's current holdings of about 411 million shares and 238.4 million pledged shares as of April 6, 2023.
Here's a breakdown:
25% Loan-to-Value Limit:
Tesla's policy caps the loan amount Musk can take out based on a percentage of the value of his pledged Tesla shares.
$3.5 Billion Dollar Cap:
Musk's borrowing is also limited to a total of $3.5 billion.
Pledged Shares:
Musk currently has 238.4 million shares pledged as collateral for his loans.
Overall:
Musk is borrowing against a portion of his Tesla stock holding, subject to the limits set by the company policy.
You haven’t added any facts either, it’s just one more statement from a random Interneter like those Reddit posts. I’m intrigued to hear some fact on this point though?
Yeah these fantasies where musk would somehow go bankrupt by tanking Tesla and overpaying for Twitter were also wild
He’s literally the richest person the earth has ever known. He’s never going to suffer financially. He has countless levers of power he can pull.
The same fantasy applies to any past or current president ever spending a day in jail. He literally commands the most powerful military apparatus the world has ever seen. Even a sliver of that capability and influence ensures nobody will ever dare to try and slap some cuffs on him
This wouldn’t happen today. Today there is talk about Canada becoming 51st state; there is relatively little opposition to that - on the contrary, the perception of Canada as a US ally drops in the US[1]. Four more years of this and I could see people similarly accepting tanks. And if you want to prevent this, the time to act is now.
Surely no one currently in power wants Canadians to vote in U.S. Federal elections? So it has to be a setup like Puerto Rico (U.S. citizenship without representation in Washington) or even American Samoa (no U.S. citizenship). The 51st state thing does not make sense at all.
I mean, he did pay people directly for voting in the last round of primaries and he's doing it again for that judge election in Wisconsin, and all his money is Tesla shares so.. yes, he's already doing it.
Even though the world is turning upside down, the fact that this is possible without facing immediate arrest is still surprising. I don't think this is possible in any other democracy.
I really wish for this theory to be tested TBH. Martial law in US would be a great thing. US economy tanks, rest of the world like Europe is forced to pick up the slack, the world gets a refresh on what conservative "small government" brainrot does to countries.
It won't be like that. You'll slide further towards Putin/Erdogan state management and oligarchy. Hints of it already in how AP and The Atlantic are being treated, and the hints about what a future judicial system might look like.
Congress has the power to declare a war, which was supposed to prevent the Executive from taking any military action that was not purely defensive, without their approval. There was even a requirement about how long the President had to give an accounting to Congress about any action they did take. So yes, Congress was supposed to have the ability to "command" the military insomuch as they could choose whether the Executive could utilize them or not. Saying "no, you're not going to do that" is an authoritative command.
Hamilton, Washington, and Madison all separately wrote that Section 8's War Declaration clause was intended to be a substantial limit on the President's power. Even the small, mini-conflicts in the 1800s required Congressional approval to initiate, it wasn't until the 1950s that the Executive branch destroyed that check on Executive power.
By command I meant that Congress cannot tell the military "go arrest the president" or "go quell the unrest in that state." I agree that Congress has ceded too much power to the Executive in regard to declaration of war/military action in foreign countries after 9/11 though.
Trump may be Commander in Chief, but he cannot start a war without Congress' approval.
Unfortunately, they've essentially given more or less blanket approval for various wars and war-like actions since before 9/11, and that approval keeps getting renewed every year.
The U.S. will never allow any former president to get prosecuted because the precedent is too severe.
By all reasonable accounts, GW Bush should have been prosecuted for war crimes. Trump should have been prosecuted the moment he left office for a spectrum of crimes. There is even a strong argument that Obama should have been prosecuted for drone strikes on citizen combatants.
But power protects power, and the moment that seal is broken all hell breaks loose amongst the ruling class.
How many people were held accountable for the 2008 crash? Zero. That would mean everyone else has to stop their criming too.
Who knows, maybe Trump is stupid and petty enough to take revenge on his enemies. If he does, no doubt his entire administration is the next against the wall as soon as the winds change.
Nixon certainly would've been prosecuted if he hadn't been pardoned.
> There is even a strong argument that Obama should have been prosecuted for drone strikes on citizen combatants.
I don't think this is very strong at all. There is zero evidence that Obama intentionally targeted civilians outside of al-Awlaki. Suggesting that he did, and that he should be prosecuted for war crimes, puts him in the same moral category as those who ordered actual torture on enemy combatants and launched wars on fabricated evidence. It's preposterous.
War crimes are a very broad category, so no, it's not preposterous to claim that different people are both guilty of them even if the scope varies significantly.
I strongly disagree with that equivalency. Obama should have pursued accountability instead of pardoning them like he did, but I do not agree that it puts him in the same moral category. Your framing shifts the argument from "Obama maybe deserves some scrutiny here" to "Obama belongs in the same cells with the torturers."
You're collapsing several degrees of responsibility with this lazy equivalence, and minimizing the heinousness of the people who actually designed and executed torture programs.
The world has no shortage of evil bastards. The only thing that restrains them is the knowledge that they may be held to account. Obama undermined that.
"Don't worry, we've got your back. If your country asks you to do evil, we won't hold you to account. So go right ahead."
Sorry, I actually meant to write that al-Awlaki was a citizen, as in an American citizen. Obama didn't intentionally target civilians, and he didn't intentionally target "citizens" as OP stated outside of al-Awlaki who was an American citizen turned insurgent.
The American justice system deserves to cease existing if 4 years isn’t enough to process people for possibly capital crimes (J6 coup attempt). No state can afford that.
Even if MAGA loses in 2028, I have very low confidence that Trump will see any consequences for his crimes. There's also the fun self-pardon-by-proxy trick: on the morning of the last day of his administration, he resigns. Vance is sworn in, pardons Trump for anything he's done, and then passes the presidency on to the next one.
Regardless, Trump is old. Even if he's convicted of something in 2030 or whenever, he probably won't go to prison. He may even be dead by then; he'll be nearly 85, and no matter what his doctors have been told to say publicly, it's hard to believe the man is in super great health.
Sure he was. He is a convicted felon, with 34 guilty counts under his belt[0]. You can't get convicted of felonies in a civil case. That was a criminal prosecution.
Trump was criminally prosecuted on both state (New York and Georgia) and federal charges, and convicted on New York state charges, before being re-elected. Because prosecution is an executive power exercised by the President, his re-election made it so that he would be President and thus unprosecutable by the time of trial on the federal charges for which there were still active prosecutions, resulting in them being dismissed without prejudice. (Technically, they could be refiled after he leaves office again.)
Concerns about Constitutional issues with state penalties interfering with federal duties also led the judge in the New York state case, where he was convicted of 34 felony charges, to sentence him to "unconditional discharge" -- essentially, he remains a convict, but faced no penalty beyond the fact of officially being a felony convict.
Issues relating to prosecutorial behavior have stalled Trump's prosecution on state criminal charges in Georgia, but those charges remain active (whether the prosecutor's office that was handling the case can continue to do so is an issue currently subject to appeal, and may not be decided for several months.)
That's a fantasy military leaders like to tell troops.
Let's hope we won't how that plays out against against the reality of having bills to pay and family members to take care of after enough layers of leadership has been replaced.
A loyalist privileges their leader over their principles. A patriot is a leader that subordinates themselves to the principles shared with their followers.
> I, _____, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; and that I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God. (Title 10, US Code; Act of 5 May 1960 replacing the wording first adopted in 1789, with amendment effective 5 October 1962).
> I ___, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God. (Title 5 U.S. Code 3331, an individual, except the President, elected or appointed to an office of honor or profit in the civil service or uniformed services)
I'll grant you that these militias are well-armed and have sketchy loyalties, but if the US military decided they were honor-bound to defend the Constitution, against Trump, they'd crush the Oath Keepers and their ilk.
Many of the members of those militias are themselves military or ex-military. Which already tells you volumes about how likely it is that all of the US military would "decide they were honor-bound to defend the Constitution". Besides, those guys don't think of what they are doing as contradicting the constitution - quite the opposite! They are very obviously wrong, but that has never stopped fanatics from believing in their creed.
The real question, anyway, is not whether the military will obey Trump's illegal orders, should he issue them. It's whether the military would do something to stop the militias if Trump lets them off the leash with an explicit mandate.
And my concern is that most of the lower-ranking officers and people below them will prefer to sit it out. Because if they do something, and it's not enough, they are all looking at actual treason charges and likely death sentences.
Do you really believe that these lower-ranking soldiers are going to sit idly by while they watch their family members get raped and executed (because that's what lawless paramilitaries do) on the nightly news?
But it won't be their family members, in most cases. It will be some despicable "cultural Marxists" or even more abstract "terrorists". And the rapes? Fake news.
Which does match what GP said. Enlisted swear to defend the constitution and obey the president. No limitation to lawful orders or stated precedence between the too. Commissioned officers don't swear to obey the president
What do you mean "no limitation to lawful orders"? That's what "according to regulations and the Uniform Code of Military Justice" means. Article 92 is pretty explicit about what constitutes a lawful order.
A soldier comes to their own assessment then a court martial decides later on if they agree. Just like every other form of action: do what you believe is within bounds, then find out later if the courts agree
The individual. If your boss orders you to do something illegal, it’s up to you to be sceptical and do your research. That’s the only way it can work without converting a part of the population to drones.
> Mansa Musa tipped so heavily he broke intercontinental trade dynamics
Thank you for dropping this fun fact. Pretty telling of my "western" education, I have never been taught anything about this guy. Quite memorable years of reign too!
Mechanically it doesn't work for two reasons: Elon's wealth is not liquid and him buying into the market would raise the price of gold far before he got anywhere near all of it.
But going further, I think you're misunderstanding my point - gold is a terrible measurement of wealth on the "human-history" time scale. At that scale, you have to consider monetary wealth as it relates to "the power to get things done" in general.
In that framing you can look at:
1. Power/wealth relative to the next most powerful people (like the Mansa Musa story). For pure wealth we often look at this in relation to country/global GDP.
2. Absolute ability to get "work" done, including technological changes.
3. Relative ability to get "work" done, adjusting for technological changes.
He's probably not close to top 10 in #1, because his relative power compared to the next most wealthy or powerful people is not that disparate, he just wields it more blatantly than we are used to in the modern era. For example, Augustus is believed to have personally controlled 6% of the world's wealth, not accounting for his power over the Roman Empire.
Elon is probably in the top 10 or so of #2, behind all modern US presidents, Putin, Xi, and maybe a few other world leaders. There's no doubting that his wealth could be converted into far more kW of work than at any other time in history as a result of technological leverage.
Much like #1, this is probably not close. The Ming Dynasty leaders, Augustus Caesar, Ghengis Khan, etc.
Re: 2026, it's possible Democrats could take back the House, and then be able to impeach the President. But it looks like they would need to win 32 of the 33 seats up for grabs in the Senate - 20 of which are currently held by Republicans in solidly red states - to guarantee the 66 votes necessary to convict. That seems unlikely.
And think about what would need to happen if you'd like to see actual change in leadership of the executive branch. You'd need the House comfortably controlled by Democrats, with the Senate controlled by a supermajority of Democrats. I think that you'd need both the President and Vice President impeached, convicted, and removed from office, while preventing the current/acting President from having a new VP nominated and confirmed, so that the Speaker of the House became acting President. This seems even less likely.
> But it looks like they would need to win 32 of the 33 seats up for grabs in the Senate - 20 of which are currently held by Republicans in solidly red states - to guarantee the 66 votes necessary to convict. That seems unlikely.
Your numbers are on point. But, there's another Math that could take us on that path leading to the same goal: A lot of republican lawmakers aren't happy currently. Although it's a long shot, some of them could join Democrats in impeaching those two clowns.
The next test of this will be the WI Supreme Court election - if the Musk-backed candidate loses (after Musk spends millions of dollars on the campaign, possibly illegally), it might start to break the hold Musk+Trump have over Republican elected officials.
Impeachments without a two thirds majority are largely exercises in political playing around. You can use them to expose information that people are keeping hidden through subpoenas, but you can't convict in an impeachment without a two-thirds majority, which is definitely not happening.
The sweeping 12-page order contains a number of provisions, including a documentary proof of citizenship requirement to vote in federal elections as well as a requirement that all ballots be received by Election Day – both of which fall outside of the executive branch’s authority to mandate.
But, there’s also a section, buried deeper in the order, that, if implemented, would give Trump’s Justice Department the authority to pick and choose what states get federal funding for election administration. It would require states to loop the DOJ in on supposed violations of election law that it encounters. But it also mandates that basic information about voter roll maintenance be shared with the DOJ as well.
If states are unwilling to enter into what is referred to as an “information-sharing agreement” with the Attorney General regarding “suspected violations of state and federal elections laws,” the Attorney General is allowed to withhold grants and other funds from those states, the executive order says.
There are several commentaries at length going into the hidden traps and pitfalls of this latest executive order kicking about, so far it looks loaded.
In the video, trump urges people to go out and vote, in which case telling them "just this time" and "you won't have to do it anymore, 4 more years, it will be fixed, it will be fine"
Coincidentally, you omitted the spicy addendum transcribing your own source, making his statement sound ambiguous. Here is what he said after your oddly selective excerpt:
"In four years, you don't have to vote again. We'll have it fixed so good, you'll not gonna have to vote."
Telling people that it will be "fixed" so they "won't need to vote" was enough for me
Unlike with Musk's "heart goes to you", if there is some context that can turn this into a benign remark it would have to be truly radical. Any takers?
>Trump said: "Christians, get out and vote, just this time. "You won't have to do it anymore. Four more years, you know what, it will be fixed, it will be fine, you won't have to vote anymore, my beautiful Christians."
>He added: "I love you Christians. I'm a Christian. I love you, get out, you gotta get out and vote. In four years, you don't have to vote again, we'll have it fixed so good you're not going to have to vote," Trump said.
It doesn't have to be enforceable at the point where voting actually occurs. It's just a prepared excuse to disqualify electors. Let's say Republicans in Congress circle the wagons around Trump and refuse to admit any new members from states that ignore the EO, like, physically. What then?
On what basis do you think 2028 elections will be free and fair? Congress is going to try to mass-disenfranchise women before the 2026 midterms. They've stated this on the record. Dems aren't going to gain control of congress in the upcoming special elections. We're totally fucked economically and otherwise unless Democrats in congress -- mainly the Senate -- can get a fucking grip, pay attention to what's happening, and be the opposition party we need.
> An estimated 69 million American women and 4 million men do not have a birth certificate that matches their current legal name, according to the liberal Center for American Progress.
Not to worry! Per the "Preserving and Protecting the Integrity of American Elections" executive order, birth certificates are not valid proof of citizenship for the purposes of voting in a federal election anyway.
It depends on the state as far as I understand it.
You need to be registered as a voter, which requires that you be a citizen. How that is enforced varies.
There are also ID requirements at the poll site. Again, those vary.
In every state I've lived in voting was in some way (optionally) tied to your driver's license. But the body issuing the license has always known whether or not I was a US citizen so it boils down to the same thing.
Driving license, no, because non citizens can get one. Passport, yes. But plenty of Americans don’t have a passport.
The OP would say these people are being deliberately disenfranchised. Personally I’ve long since given up judging these things based on what I think may or may not be in the hearts of those writing it. We don’t know so it just becomes an endless back and forth. Instead I look to the facts: the SAVE act would make it more difficult for many people to vote, with an aim of stopping those who are unauthorized to vote from doing so. There’s never really been any solid evidence of the latter happening in notable numbers so to me the trade off doesn’t feel worth it.
IMO something like the SAVE Act needs to also legislate the process by which a citizen can easily get an ID in order to vote. But it doesn’t, it just says that states would manage it. Given that some states used “literacy tests” to disenfranchise black people not so long ago I personally don’t trust they would all approach ID access in a fair and equal way.
Slight correction: there's a thing called "enhanced driver license" that some states issue that complies with the relevant federal standards and can serve as proof of citizenship (they are only issued to citizens). It is, in effect, a passport card combined with a driver license on a single card.
I believe they are talking about the SAVE act, which would apparently introduce new requirements for voter registration, supposedly making it so that identification and legal birth names would need to match in order to register to vote which could impact married women. I am not taking a position on the correct interpretation of the act, just stating initial search results.
I looked at the act and I don't see anything claiming that ID and legal birth names have to match. Birth certificate only has to be provided if you have no ID showing you were born in US
… what ID shows you were born in the US? I was born here, am a citizen, have a passport, but don’t have such a thing. Aside from my birth certificate. What else is there?
According to https://www.dhs.gov/real-id/real-id-faqs "Yes. All states, the District of Columbia, and the 5 territories are REAL ID compliant and issuing REAL ID compliant driver’s licenses and IDs."
So from my understanding all DLs would qualify too (Except maybe older ones that were issued before real id?)
Last I checked, we’re just a little over 50% with real id. That’s why they’ve kept pushing back the requirement to have one to fly (they might finally do it this time?)
I’ve tried to get one twice since they started doing them, in two different states, and failed to have one thing or another on the bills and paystubs and such that I took in, so don’t have one. My wife’s got it even worse, they need an original of our marriage certificate (due to the name change) and that’s gone missing. She hasn’t bothered to screw with it, because she’s got a passport anyway (which, as you note, will do after all, I was wrong)
Yeah, you and the sibling are probably right and I’m just unobservant (if I could remember where the hell it is at the moment I’d verify, but probably it’s in there)
Trump can arrest the electoral college members from the blue districts under the guise of election fraud. And if that doesn't work, Vance can just pick his own set of electors. Remember, the Supreme court made it legal for Trump to literally drone strike US citizens without legal recourse.
Of course this will cause a bunch of Tumroil, which is good for Trump, because he can just holdon to power.
If you think that has no chance in happening, I envy your optimism.
Well see, but at this point crazy is full on the table and has a definite chance of happening. I legit would not put it past Trump to institute martial law during any elections.
> Congress is going to try to mass-disenfranchise women before the 2026 midterms.
That's only if the SAVE Act passes, or whatever else they dream up passes. The House can pass whatever MAGA wants, but the Senate needs votes from Democrats to clear the filibuster.
Unless of course the GOP yet again does what they say they'll never do, and drop the filibuster.
The filibuster is a simple rule, and can be removed by a simple majority vote.
I actually expect Republicans to do so soon enough now that their control of the Senate is virtually guaranteed for the foreseeable future, and they are reaping all of the disadvantages of the filibuster without the benefits.
> Optimistically speaking it could happen as soon as after Nov of 2026 (midterms).
The midterms could have some meaningful effect a lot sooner than that if we start seeing across-the-board primary challenges of pro-Trump Republicans. Of course, all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
More likely is that competitive districts flip blue. Republican primary voters don’t seem to be upset. They’re getting what they wanted. It’s independents/undecideds that flip flop every election that could sway back against the GOP after getting tired of democrats in 2024
> all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
> Republican primary voters don’t seem to be upset.
I don't think it's really pushing things to say that President Trump is taking actions to destroy democracy in America. Basically he's step by step attacking the institutions that might be able to stand against him or resist him. He attacks judges that rule against him, he attacks congressman on the Republican side if they look like they might go against him. That's anti-democratic
True, but I don't think you're really arguing against what GP and above said. Sure, he's taking those actions, but it's far from clear whether or not he'll succeed. Those judges are so far standing up to him. Even Chief Justice Roberts publicly pushed back, something highly unusual.
The attacks members of Congress are troubling, but in a way don't matter too much: the deciders for control of the Senate or House are swing voters in swing states and districts. Whether or not the Republicans in Congress are MAGA adherents or older-school reasonable Republicans matters less than you'd think (and less than I'd like).
The one wrinkle in that is the Senate filibuster: if Democrats regain control there, depending on their margin, they could need up to 10 reasonable Republicans in order to make progress on most things. 60 Democratic Senators is unlikely.
Trump was elected by the whole US population. Why does a judge, who was not elected by the entire US population, is able to block the democratically elected president? To me, it sounds like the judges are the ones "destroying democracy" as they are blocking the will of the people.
What has Trump done to take away votes from people? Every election is still happening. US citizens are still able to vote.
Our balance of powers works that way, it's not a novel concept that was just invented. The president does not have some special power because he won the electoral college election, majority of voters, plurality or whatever. He still has to follow the rule of law, he still has to obey court orders. If the president does some action that a federal judge rules was illegal, then they can stop it. This is completely ordinary and every president faces this, Biden, Trump 1, Bush2, Reagan etc.
> all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
Seems to be absolutely no basis for that assumption. His approval ratings are in the mid 40s, and the people that vote in primaries aren't exactly the waverers and independents that just wanted a change from Biden.
It could change when he properly tanks the economy, but association with Trump isn't likely to be a problem in primaries when you've got more than half a party's membership so immune to reality they'll insist that not only was Trump doing a good job of running the country in 2020, but he also won that election...
If Trump is on a path to tank the economy, the asset markets will react immediately to that prediction and everyone will know it. This may well be the most tightly binding constraint on Trump and Musk's actual behavior right now. Right now markets are doing worse than was predicted after the election but they're not that terrible. This seems to predict that Trump will muddle through somehow, as the most likely outcome.
Which is precisely why there won't be 2026 and 2028 elections. I dunno why people are pretending this is just 4 years of Trump. He tried to overthrow the results before, and this time around, he has support of all 3 branches and players like Elon Musk.
US is going to do the same thing Russia did with Putin.
If we end up having elections, its actually gonna be worse of long term, because despite tanking economy, most people aren't going to suffer that much, which means the pattern of Dems inheriting a shit economy, everything getting blamed on them again like with Biden, and then a smarter Republican comes along and its a repeat again in 2032.
The main difference between the US and Russia in this regard is that the US federal government has very little say or control over what are state-run elections.
Solidly red states don't need election interference; they're going to vote red. Solidly blue states aren't going to tolerate interference. The handful or so of swing states will be watched incredibly closely by everyone else for even a hint of interference.
> and then a smarter Republican comes along and its a repeat again in 2032.
I mean, this is just how American politics works now, and has worked since extreme political polarization took root. That's what happens when you have FPTP voting and a two-party system, where members of each party show complete disdain (justified or not) of members of the other party.
FWIW, the first thing Putin did after he got elected wasn't to mess with the elections; rather, he methodically strangled all remaining free press in the country above a certain threshold. Basically no opposition TV at all, only a couple of radio stations and newspapers. Massive electoral fraud orchestrated from Kremlin only really began post-2008.
It's completely reasonable to think and plan ahead, especially when we are dealing with someone who is refusing to acknowledged a democratic loss. This is not theoretical, we know how he reacts when he looses a election.
>reasonable to think and plan ahead, especially when we are dealing with someone who is refusing to acknowledged a democratic loss.
>This is not theoretical, we know how he reacts when he looses a election.
It sounds like from your perspective, the sequence of actions should be pretty obvious: create a market on polymarket or something for Trump to not acknowledged a loss, put up some money on it, and at the expense of people who perceive this question as theoretical you should easily get your x20-x30 insurance if something like that happening and can go to live in Europe in your own mansion (or even castle, there are many of them in Europe).
I guess it's telling that faced with the prospect of the fall of American democracy, the obvious thing is to start gambling on it.
I don't know how much I would gamle in such a case. There are many outcomes compatible with his previous actions. Maybe he gets a heartattack. Maybe there is no election. Maybe the election process is manipulated so he wins. Maybe he actually wins, fairly or 'fairly'. Maybe they find a way for him to run, maybe it's Vance. Maybe someone else.
The important thing is that we should prepare that shitt will happen, and democracy don't survive automatically. We literally have him on tape, pressuring Georgia secretary of state to "find 11,780 votes" and overturn the state's election results. And it is not 'lazy' to prepare (intellectualy and physically), and when it happens it's too late to 'discuss the politics'.
You are probably not aware of this, but these are the events on and leading up to Jan 6.
* Trump calls fraud on elections with no real evidence. Lawsuits are filed. Every single one of them gets dismissed except like one, which ends up turning more votes for Democrats anyways
* Some adviser puts in an idea in Trumps head that Pence can reject the results and send them back to the states
* Trump basically gathers a crowd together, tells them to march to the capital to save our country. As the protesters are breaking in, there are records of him just calling different senators and asking "are you sure you don't want to delay the certification of the vote", all while being told that protesters are breaking in and getting hurt.
* Trump sends a fake set of electors from key states, calling on Pence to "do the right thing". Those fake electors were of course arrested and prosecuted.
None of this is disputable, undeniable, as it was brought up in a republican controlled supreme court hearing, which you can read for yourself. Supreme court decided that President is basically immune from legal punishment as long as he is acting within official capacity.
So saying he is gonna do more shit this time around, granted that he has legal immunity to do so is about as speculative as saying the guy who does 2 Nazi salutes probably believes that the Nazis were right in a lot of things.
Do you truly believe this will happen? I know these are crazy times but the idea of a then-82 year old man realizing a third term for himself seems a little absurd to me. Or do you mean this in a less literal sense, e.g. in the sense that he'll get a figurative "third term" by handing the reigns over to someone in his club without a fair election?
No I mean literally. Or he'll do what putin did and find a puppet to take the reigns for a term.
He knows without presidential immunity he risks prison. And he has previous for trying to steal an election.
I have no doubt he'll see to it that he never faces the risk of prison, and this is the most obvious way to go. That and he's clearly a power hungry megalomaniac.
I think it'd be more informative to ask why he wouldn't try to get this.
So the taliban or the Vietcong were more powerful than the US military? They won because they were defending their own country which gives them higher motivation and an advantage as defenders. If you look at the military itself, the US was always much more powerful.
Ok, but they still are more powerful. That’s what the discussion was about. Having a disadvantage and losing doesn’t mean it’s not the most powerful military that ever existed.
No, it's like doing a drag race with a formula 1 car against a mini but the mini is on a street and the formula 1 car is on a dirt strip. If you want to compare military power, you would have to look at "Who would win in equal situations", not "Who won a 1 vs 1 with different starting situations".
If you had to perform a military action and had to pick either the taliban or the US military to be your military to use, would you ever pick the taliban?
The only reason they had a chance was because of external factors, not the power of the military itself.
I'm not sure if you are joking or not, but anybody who measures military power doesn't actually looks at things like ability to do something. Talbian and co simply survive and don't give up. But they are totally incapable of anything else beyond that.
> Conventional armies have a hard stand against partisans.
No they don't. Its just not worth doing in the long run.
And whatever you may think of the US military forces, they have the ability to do lots of things.
Anybody who actually cares, you know actual professionals, looks at things beyond a very limited set of real world results in very restrictive circumstance.
That's like saying, this NBA team after a 5d journey, and no sleep played a basketball game against a local team, with the whole crowd hostile, a complete broke court and a totally different ball.
And even then they would win for 20 years straight and the other team is only annoying to deal with. Until the owner decide there is no point in it.
And from this you conclude that that NBA team is bad at basketball because 'real-world results'.
You are delusional, if you think the USAF can bomb any target in any airspace without losing the plane. If losing the plane is allowed, you have to admit, the Taliban have been exceptionally successful, too.
Depending on the target your cruise missiles are out of range and your fancy aircraft will have to face air defense systems. (Especially, since you moved your fat ass carrier close-by...)
So, does your magical aircraft carry those dozens of cruise missiles, immune to every modern anti-air missile it will encounter? You know, instead of spending all that money on aircraft carriers, some countries have spent their money on air defense instead. Try to fly an F35 to Moscow.
Sorry, but this is laughable. If what you said was true, geopolitics would look very different. The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike. Why even have nukes then?!
> Depending on the target your cruise missiles are out of range and your fancy aircraft will have to face air defense systems. (Especially, since you moved your fat ass carrier close-by...)
Right, but the scenario was unspecified enough that I assumes peace time and the planes can retreat before the enemy notices the attack and shoots them down.
> Try to fly an F35 to Moscow.
I won't fly my F-35 to Moscow, I will drop some AGM-158 JASSM-ER over eastern poland and the pilots will probably be back on the ground before the russian air defense has even tracked the missiles.
> Sorry, but this is laughable. If what you said was true, geopolitics would look very different. The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike. Why even have nukes then?!
No, I don't get why people think that. That's the exact reason why countries have Nuclear missile subs. So they can retaliate, even after a first strike.
But even if they hadn't, what you said wouldn't follow. Because having the ability to strike whatever you want doesn't mean you can prevent a second strike. If you launch cruise missiles, the target can detect them and send a retaliatory nuclear strike before the cruise missiles arrive and destroy the silos.
> The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike.
I didn't say the US could hit all points on Earth simultaneously. Russia has a bunch of nuclear silos and submarines. Brighter Russians than you have designed their nuclear arsenal to survive this US capability.
I don’t want to downplay your point, I basically agree, but in real terms I believe there have been several people richer than him, and it is hard to judge the relative wealth of people long ago.
I don't like this market cap against GDP measurement. The multiples in Market Cap in those era would be significantly lower. If we look at P/E of S&P 500 [1], what used to be peak PE of 20 a century ago are now considered normal.
So adjusting for all that Rockefeller would still be richer than Elon.
Well his wealth can decrease by 200x and no sane person could claim that he's "suffering" financially with what he has left.
> somehow go bankrupt .. were also wild
That depended entirely on how Tesla's stock performed. If he had to liquidate $20 billion of his stocks to pay back the Twitter loans his wealth would have decreased by much, much more than that.
Him being a Trump associate is a lever, but not a financial one… unless and until they have a falling-out. I'd be surprised if that's any less than 6 months away, or more than 3 years away.
> The same fantasy applies to any past or current president ever spending a day in jail. He literally commands the most powerful military apparatus the world has ever seen. Even a sliver of that capability and influence ensures nobody will ever dare to try and slap some cuffs on him
Depends if he dies in office (~10% all causes, he's old etc.), and if the dems regain congress in two years.
Trump was already very close to getting one day in jail due to inability to behave himself in the trial where he got all those felony convictions, and he did get impeached twice.
> unless and until they have a falling-out. I'd be surprised if that's any less than 6 months away, or more than 3 years away.
That's the other thing: Trump's tastes and whims are super fickle. Trump and Musk have already clashed on a bunch of things, and there's no reason to believe that won't continue and/or get worse. And Trump's priorities could change, without a corresponding shift in Musk's.
I have no opinion about Musk or Trump. I just want to give counter-examples to your claims: Saddam Hussain, Mussoloni, Ceausescu. At the peak of their power, they all seemed untouchable. Would they even have thought, when they were ruling their countries, that one day their fortunes would turn?
Quoting Gandhi: "There have been tyrants and murderers, and for a time, they can seem invincible, but in the end, they always fall. Always."
I think if we look around the world we can find plenty of counterexamples to Ganhi's quote.
Sure, they always "fall" in the sense that they're not immortal and they'll eventually die, but it's often (usually?) the case that a family member or some sort of protege steps up to fill their shoes.
The first counteraxample that comes to mid is Idi Amin, the Ugandan dictator. He murdered, pillaged and lived out the rest of his years (happily and luxuriously) in Saudi Arabia.
I mean this is exactly the reason why they won't want to put Trump in jail - so that it doesn't turn out like in Korea. After all, where you can put one president in jail, you can put a next one in jail too.
I mean, yes? Where you can put one president in jail (for trying to demolish democracy and establish oligarchy/autocracy), you can put a next one in jail too (if they try to do the same)
This is called upholding the constitution and it’s fundamental for a democracy. If you say president is immune, you get current US.
Past presidents don't hold command over any military. France sent a former president to jail just a few months ago. Brazil and South Korea are in the process of putting a former president on trial. El Chapo was billionaire and had a private army of murderers – he's currently in prison.
The main reason Trump hasn't been impeached and (possibly) jailed is because the political system in the US is dysfunctional. Party because it's not a great system to start with, and partly because a critical section of people made the decision to intentionally break it for selfish gain. But there is nothing that says it needs to be like this.
IMHO the US is turning into an oligarchy / autocracy like Russia. Musk is one of the oligarchs. We all know what happens to oligarchs when they get too close to eclipse the top dog and go near a window.
He only holds ~15% of Tesla. His real money is in SpaceX... 50% ownership there. I wish people would think just a little before parroting the "hit Musk where it hurts" drivel.
At the rate he's going, SpaceX is probably on its way to being nationalized within the next few elections.
And that would make sense totally aside from punitive response: it is pretty dangerous to have such vital defense infrastructure controlled by such a mercurial personality.
According to existing Supreme Court precedent[1], nationalization of companies requires approval by Congress, not just the President, so that would make it more difficult.
According to existing Supreme Court precedent, the president isn't able to impound funds which had been allotted by Congress (line item veto) [1], or fire the head of an independent agency for reasons other than allowed by Congress [2], it doesn't really seem like precedent has much weight amongst those in power today.
> And that would make sense totally aside from punitive response
So the government has spend the last nearly 50 years completely failing in building rockets or sats the way SpaceX did. SpaceX with little money did it in less then 20 years.
And now you think its smart to have have the government taking over again? Do you want the government to run the global Starlink network, dealing with costumer complains?
What part of NASA or any part of the government in the last 20 years convinced you that they could operate SpaceX?
DoD tried to make space good and literally created ULA and after 10 years they often paid 300+ million for a launch?
And just FYI, Starshield is Starlink for the government and the government already controls those themselves.
The US government could buy out Musk, keep the company public while owning a majority of the shares and do nothing with them unless the company does something incredibly stupid.
That's also how Europe does it and its even worse then the US. And China rockets aren't all that impressive.
Also, the US has little history of this and the history it does have is utterly terrible. Go look up the performance of US own weapons factories threw history, basically just a long list of failure that lead to real issues in wars.
The US does not need to own the company to be able to prevent them doing something they don't want.
The current administration has shared favorable views on "public-private partnership", which suggests that outright nationalization isn't the goal; I'd imagine the more likely scenario is that national assets will be dismantled and their functions will instead be contracted out to private operations with horrendously corrupt deals.
You're not wrong, and I get the aversion to any [modern] precedent that nationalization sets. It's not one I'd like to see set either.
I think the more reasonable crux here is why there was no clearance revocation. The guy inserted himself into geopolitics in a manner that ran counter to DoD and USG foreign policy while operating critical defense infrastructure, temporarily (with limited scope) revoking an allied nation's access[0], and being privy to secrets involving said infrastructure.
If in the future we're putting SDI-like capabilities onto satellite constellations his company operates, why let someone with undeclared back-channel comms with a foremost strategic adversary be cleared on the design and operational details of something critical to US strategic defense and national security? The very adversaries that such programs are designed to counter and deter.
That's before you even consider instability from doing every drug under the sun, which normally would be sufficient grounds alone.
I've no doubt he believes himself to be a patriot and probably hasn't violated his oath. It's just that holding a clearance has traditionally been based on risk. Regardless, not like there's anything anyone can do about it now.
To put this in perspective, Canada's wondering lately if the US is going to attempt to annex them. Should that happen, it definitely seems like a foreign policy objective of an adversary of the US, rather than one in the interests of the US.
I'd like to think any reasonable person views this entire situation as nutty, regardless of what side of the aisle they're on.
I would be much more sympathetic to this argument if we hadn't seen Musk and the other oligarchs get away with anything and everything over the past two decades. Especially now that Musk holds a position of very considerable power in the administration, and without the approval of congress.
It seems to me that Musk may very well spend the next 4 years cutting everything he can from NASA, NOAA, the Post Office, and other federal agencies. Those capabilities will still be needed, and it is clear from the stated goals of those steering this administration [1] that they intend to steer as much as possible into private enterprises. Many of those enterprises are owned by Musk himself.
I don't know about you, but I see a major conflict of interest with one person both guiding the privatization process and profiting from it. If we do see a case where he steers federal funds from government agencies into a private company - at the cost of the ability of our government to execute critical functions without enriching Musk himself - then I have absolutely no issue with reclaiming those capabilities.
I agree on the conflict of interest part, but that conflict can be removed by winning elections and not some authoritarian seizure of private property. If Democrats controlled the government to the point that they can seize private property, he wouldn't be in government in the first place and there would be no conflict.
After the conflict of interest is resolved, what next? The capabilities are still lost. He has still gained wealth from malfeasance. What's the next step? Pay him more money to fill the gaps created by corruption?
No, the answer is to ensure any profit from corruption is reclaimed. The idea of "just let the corrupt keep what they stole" has led us right here to this moment.
EDIT:
I do want to be clear on what my concern is here, too - I don't have a problem with commercial space flight. I wouldn't have a problem with NASA using commercial vendors for a major of their missions. I would have mild concern but not a great deal if NASA dropped most of their launch capabilities, retaining only ones needed for specialized missions and unique orbits. But I wouldn't oppose it like this.
But I have a major issue with that process being run by the one person most likely to directly profit from it. That completely destroys all faith that the process is being done in a responsible way that will put the well-being our nation above the wealth of a single individual.
Some of the cuts will just be cuts, and those services will be gone, in case where Trump's and Musk's cronies don't think they can build a profitable business around them. Others will just get pushed into private hands, and then when progressive administrations come into power, any attempt to bring those functions back into the federal government will get lobbied out of existence.
If lobbyists can do comparatively low-stakes stuff like keep the IRS from sending people pre-filled tax returns, you better believe lobbyists can keep NASA, NOAA, USPS, etc. privatized once they're dismantled.
Is it a "fascist government seizing private property" if Congress votes to nationalize a company, as is laid out in law, and the president signs the resulting bill into law?
Some research may be warranted on your part before you have a kneejerk reaction. The US has nationalized businesses in the past even when those business were solvent [1]. SpaceX would of course be a larger case and much more politically fraught, but I don’t think nationalizing SpaceX automatically makes it a fascist government.
Oh, and you may want to look up eminent domain. The government regularly seizes private property and even does so effectively on behalf of other private entities. If you’re actually consistent on your framing then you’d have to admit you’ve lived your whole life under what you consider a fascist government regardless of political affiliation. For example, here’s [2] Trump using the government’s eminent domain power (before he was president) to take property from another private entity. And here he is doing the same thing [3] as president.
Your source states that the nationalization was done either in the case where the government was owed a debt by the nationalized company or in the case of the railroads, where they were seized to ensure the continuation of a vital service where the company providing it was insolvent. Neither of these conditions apply to any of Elon Musk's companies.
Eminent domain is a process where the private property is seized (with the government required to pay fair market value) in order to use that land for some public purpose that it is not currently being used for. This could potentially be done to property owned by Elon Musk, but not for the justification that he has too much power. And also it must be specifically land that is seized, not equity in a company.
If congress passed a law seizing his property, or the government initiated eminent domain against all of his company's properties, it would be obvious that it was Elon Musk being targeted and not any legitimate public need for a piece of land. This is a called a bill of attainder and is unconstitutional. https://en.wikipedia.org/wiki/Bill_of_attainder
This whole narrative of "big government with lots of power = bad" doesn't really apply anymore. US has shown the citizens no longer deserve the freedom that they had, because we can't be responsible with it.
We do need a big powerful government full of Democrats to run things. US economy grew under democratic agenda, and Democrats have proven that they actually do give a fuck about the country, so they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base.
Because if you want to make the argument that this will tank the economy as free market capitalism is reigned in, that also doesn't fly considering the economy is being tanked right now. The difference is, under Dems, once things stabilize, everyone will be better off.
>This whole narrative of "big government with lots of power = bad" doesn't really apply anymore.
>US has shown the citizens no longer deserve the freedom that they had
>We do need a big powerful government full of Democrats to run things.
>Democrats have proven that they actually do give a fuck about the country, so they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base.
And after that they say that it is the Trump who is the fascist.
Ah yes, the classic "your rhetoric annoys me so I'll instead vote to burn everything down and I don't care who gets hurt in the process". Good reasoning, there.
Annoyance has nothing to do with it. It is the authoritarian morally superior attitude expressed by this statement that is so prevalent among Democrats.
> they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base
> US has shown the citizens no longer deserve the freedom that they had,
So, morality isn't a concern as long as you get something out of it, got it.
Too bad all you're gonna get is a botched and broken nation and years of misery, but that shouldn't matter as long as you get "something for my money".
And you're sure you're gonna get "something for my money" with people that make no attempts to even veil their corruption and lawlessness. Right? Say, are you, by any chance, "rich"? I mean, rich enough to be considered rich by the oligarchs, that is.
Here is the thing though - nobody can predict the future. Statistically, going by historical examples and knowledge, everything that Musk and Trump are doing is wrong in regards to economy, but there is a chance that they are actually right and everyone else has the "woke mind virus".
The thing you need to understand is that if you vote Republican, you aren't aligned with actual reality. The problem is that you see things as black and white - anything that has a sign of the woke mind virus has to be gutted and restructured. This kind of thinking is a case of the classic human bias where you chose to pay attention to the information that fits your narrative, while ignoring the information that does.
This in turn makes makes you less likely to predict the outcome of politics, much less prepare for it.
So if you want to place your bets on Republicans, just know that you can lose very hard, while people like me who are in tune with reality end up being better of.
Honestly, next election (if we even have one) Ill ironically be voting Republican as well, for the reason that I believe in accelerating US downfall. EU seems to be the better system going forward, and they need a nudge in the right direction to pick up the slack, and also institute more stringent society policing to prevent the same from happening to their countries.
Judging by the result of the 2024 election it is the Democrats who are much less in touch with reality and less able to predict the outcome of politics or prepare for it. Let's face it. You guys were completely blindsided by Trump twice, and the second time you had 8 years to prepare.
I don't think you fully comprehend what Im saying (or maybe you do and you are just being purposefully obtuse and/or trying to troll)
If we had perfect knowledge of what goes on in US politics, we would not be having this discussion. Instead, we are forced to parse information from different sources, and figure out what the reality most likely is in our head.
If you are unable to be unbiased (and you, and every other Republican are clearly not), towards information, the chances of you being able to predict reality accurately go way down.
It could very well be that US economy tanks so hard that we enter a pretty harsh recession, with lots of job loss, lack of social services we rely on, and so on. Its a possibility. I don't know that it will happen, but you also don't know it won't. The difference between you and me though is that because I don't blindly believe in one side being right and other side being wrong, I have a much better chance of seeing signs and taking respective action, like selling my house and moving out of the country before it does.
The TLDR of this is that you vote Republican because you are an idealogue. I vote Democrat because of rational decisions. If you want to continue doing this, its not my problem. The least I can hope for is if you do some critical analysis of yourself and figure out whether the things you believe are actually true or do they just sound good.
How much is SpaceX worth? How do you even calculate that, knowing that a long term plan includes Mars colonization, astroid mining, etc, with it having a near monopoly on space transport, at the moment?
Some multiple on the last funding round (perhaps a multiple <1) would be perfectly sufficient.
Declaring my company has plans to build a Dyson sphere doesn't make it suddenly worth infinity money, and even if you believe it does, that belief won't stop the US government from seizing it.
You're irrational. They had $13B revenue in 2024, and profit > $4B, with the profit of the previous two years covering ~60% of their total accumulated funding to date.
Well now you're just quibbling about the amount; it seems you do agree that SpaceX can be valued. You just don't agree with the <1 multiple the GP suggested. So ok, how about a 4x multiple? 8x? Whatever! Private companies can be valued; it's done every day. SpaceX is not an exception here.
Musk can say he's going to colonize Mars or mine asteroids, but the markets are perfectly capable of deciding on how likely (or unlikely) it is that he'll succeed, and price accordingly.
Colonizing Mars is a money-loser. It could completely tank the company. What business model involves colonizing Mars and then making a profit off that?
Mining asteroids is something we're so far away from that it's not worth baking in at that point. With current technology, it's far, far, far cheaper just to mine on Earth, even for things that are relatively rare.
> Well now you're just quibbling about the amount;
Of course, the question was about how to estimate the amount. It's a nonsensical answer that doesn't attempt to answer or help answer the question. If they were funded $1, their answer would still be correct: non zero multiple of a non-zero number (their last round of funding). It's an answer with unreasonable bounds, on both ends, especially the lower (fraction of last round of funding, even though current revenue is an order of magnitude more). It also has no precedence. The value of a company is never estimated based on rounds of funding from years ago (last was 2023 for SpaceX). It's based on both the present and projected performance.
It's not a rational answer, by definition, since it wasn't made with logic or reason.
You: You’re irrational. They made money last year.
What?
Do you think earning a profit makes your company uncountably valuable? Or earning a profit and adding some promises on top? Neither is true!
These aren’t real problems in any scenario and certainly not in the scenario of “hello the United States of America is seizing your company, here’s a check we think is fair.”
I responded to what you actually wrote in your previous comment:
> Some multiple on the last funding round (perhaps a multiple <1)
The irrational part is that it could possibly be a fraction of their last round of funding. Do you agree it would have to be a multiple much greater than 1, since their last round of funding (750 million) was a small fraction of their profit last year, and they are on the path of exceeding their total accumulated funding for all rounds in another two years?
I've never seen a profiting company valued based on their last round of funding rather than current/future revenue/profits. Do you have any examples of this, in the real world?
The Mars colonization thing is worth so little that it’d eclipse everything else and make the company worth negative dollars, if he ever really puts them all in on it. It’s pure fantasy. Mars sucks. It sucks very, very, very much. It sucks more than a nuclear-holocausted Earth that’s also had a decent size (but not crust-liquefying) impact and an insanely bad climate disaster, at once. It’s an awful place.
> it’d eclipse everything else and make the company worth negative dollars
I'm not sure I understand this. SpaceX would potentially profit from any transport services provided. Why would others paying for the missions reduce the worth of SpaceX? Or are you suggesting SpaceX would be the one funding it all?
I know that they claim their long term plan is Mars colonization and asteroid mining, but frankly I think those are lies.
It cost the Diablo cheater nothing to simply lie about this, they have no concrete plans on how to get to Mars or establish a colony, they still can't even get to the moon, with the deadlines being pushed back years at a time and getting increasingly more convoluted.
I'd be happy enough to be wrong, if we can get people on Mars in our lifetime that would be pretty cool, but Elon lies and embellishes nearly everything, and there's basically no consequence to lying or embellishing "plans" to colonize Mars.
This is correct, but there are plenty of Tesla dealerships to protest outside and cars for people to remember they don't like him. People could protest outside a SpaceX facility but it's unlikely they would garner any attention by doing so.
15% of that is paper money, heavily levered against. If he tries to sell even 2% of that in order to turn it into actual real money, the remaining 13% will be worth less, because a sell-off will lower the stock price.
Of course, just selling a single stock will lower the price of other stocks. But the dropoff is nowhere close to what you are implying. He has sold lots of stock over the years and somehow Tesla stock price didn't drop that much.
I feel like you used 'worth less' to imply 'worthless'. But this is far from the case, 13% would still be a gigantic pile of 'money'.
His 15% of Tesla is heavily borrowed against, and if Tesla's share price drops too far, he's gonna get margin calls. That will both destroy his wealth, and hurt Tesla's stock price even more.
SpaceX is worth less than 10% of what Tesla is valued at, so 15% is still a larger holding and very much "where it hurts". You should consider pausing before calling the popular position drivel.
Is he really rich? He started a car company, one that is known to make shit cars. All of their big bets failed. So what was supposed to be "not just a car comoany", which is what all the insane valuations were based on, is now "just a car comoany" and a shit one at that. So why is this car comoany still valuated at such insane hype levels? Is his wealth not entirely tied to the hyper-valuation of this car company?
Except for the Cybertruck the cars are pretty good. The overvaluation is because Musk wants everybody to think Tesla is an AI company that makes self-driving cars, which by now everybody realizes is bullshit.
Tesla makes pretty nice cars if you're willing to drive them yourself and you only occasionally use autopilot as a kind of smarter cruise control. Never use FSD unless you're willing to pay through the nose for a system that only works in select locations and otherwise tries to kill you every few minutes.
I just borrowed a hundred trillion dollars from myself, then paid it back instantly. This means the majority of 2025 US GDP is now my financial activity, right? Seems newsworthy.
All money is made up. The banks literally "lend" money into existence without having it backed by anything, the banks don't need to have the money in the first place, the bank reserve requirement has been dropped to 0% in 2020.
It’s true that all money is made up, but not in the same sense OP means.
Like I could give you 20 dollars and it’s made up in a sense, it’s just a piece of paper, but also you can go to the store and buy things with it.
Whereas if you’re an investor in a company and the CEO does some self dealing which nominally values your shares at 20 million, you can’t go spend that. It’s even more made up
Musk threw in xAI ownership to sell those bonds, which themselves have an 11% rate. Musk basically backstopped the bonds by giving a heads up of this.
No, that was absolute fantasy numbers, and in no universe did it verify any value of Twitter.
Musk really, really knows how to play people. He deserves that credit.
And I mean, bond discounts or not have nothing to do with the value of a company. The discount on a bond is based upon the likelihood they'll ever be paid off, and after it was clear that Musk would save the failure of X by using one of his other companies and AI hype to do so (as others have said, just like SolarCity), the bond lost its discount. X's value could be $1, but if the bonds are going to be repaid they'll sell at no discount.
But all the armchair business experts assured me that the value of Twitter had completely tanked since Elon bought it because he’s such a stupid fool who ruins everything, so shouldn’t it be worth less? Just a few months ago everyone was confident it was only worth $8 billion.
He bought it with stock from another company that has no clear value and is a meaningless hype monster. What is xai going to do that 10 other AI companies aren't going to build, anthropic, openai, etc.
Theoretically the synergy with Twitter could be fantastic in terms of potential value added, if I’m trying to be down to earth. The others have no real foothold in the real world beyond their own services, and users may flock away as AI integrated into their favorite apps etc. become good enough.
The sibling examples where good as well, but I think missing a major one: Consumer access. xAI can just merge their chat bot into the X/Twitter app, and suddenly they have a couple hundred million users on this thing. In a commoditised market, distribution is everything.
Also seems to fit with Musk's vision of turning Twitter into some kind of US WeChat, an app people do a bunch of stuff in. Using LLMs to do a bunch of stuff seems to be the way the hype is going right now.
I don't know if I see long term value here, but I can't say I don't see the story.
You can’t think of a single synergistic thing? Seriously?
Automating some administrative tasks? Gauging sentiment across swathes of the population on a given topic? Providing stuff like the “reader context” but attempt to pre-empt it so better info is shared to begin with? And yeah, probably lots of Twitter bots for different things. Provide automated customer support for companies on there, or help people find products relevant to what they’re discussing/browsing etc.
There are literally a million options; I find it hard to believe you couldn’t think of one
Sir or madam, if you are defending the value of xai then I think it's incumbent on you to suggest the synergistic or other value creating aspects of xai, when other people are doubting it. Many other of these types of systems are doing these same things like creating software to do administrative tasks, summarizing the gist of an article or a series of comments. Those are the most basic things that all of the other systems are doing also.
It’s not my job to think for you, it’s your job to do that. He asked a really low-quality question. It’s like when the fresh-grad dev tells you he can’t figure out his ticket.
…okay? Did you read it? Was there enough info? Where did you get confused? I’m happy to provide clarification, but if he stopped so quickly he couldn’t think of a single way that a social media platform could leverage in-house AI (or vice-versa) and the power that would come from (still, somehow) being one of the foremost social media sites on the planet, then it’s not the time to ask questions, it’s the time to think a bit more.
on x? like... for marketers? do we really need ai to schedule tweets or auto-reply with “thanks for the follow”? feels like we’ve had that stuff for a decade already. just because it’s ai now doesn’t make it new or useful.
> gauging sentiment across swathes of the population on a given topic?
you mean gauging sentiment from a user base that’s gotten increasingly loud, extreme, and way less representative of the general public? that’s not insight, that’s just noise with extra steps.
> providing stuff like the “reader context” but attempt to pre-empt it so better info is shared to begin with?
in theory, sure. but that’s assuming the platform actually cares about curating good info and not just maximizing engagement. reader context is cool when it works, but it’s super inconsistent and often buried. ai preemptively “fixing” info sounds nice until you remember who’s training it and what incentives are driving it.
> twitter bots for different things / automated customer support / product recommendations etc.
yeah i mean, bots have been a thing on twitter forever—some useful, most annoying. ai-powered ones could be better, but the platform’s current vibe isn’t exactly welcoming for brands trying to do legit support or sales. good luck pitching your socks in a thread full of people arguing about conspiracy theories.
Newspeak phrase of the day: Conglomerate Discount.
Some inverters believe they suffer from "conglomerate discount" [1]: that their whole conglomerate can be worth less than the sum of its parts. Who decides what the parts are worth? The investors, of course. Buying shares of their own company is a pretty standard way to fix the "discount".
you might want to check who owns majority of FAANG stocks. once you identified those, check how much they own of each others. Musk is just doing what everyone else does
I'll do you one better. The Market Makers are Vanguard, Blackrock and State Street which are majority shareholders of 80% of the SP500. They control the price using swarms of HFT bots, most likely running Blackrock's Aladdin algo which they license. The largest shareholder of Blackrock, is Vanguard.
It's all private capital. The only people who are exposed to this deal are the banks who make loans to Musk and Twitter, and the investors who put capital in to take Twitter private or to invest in xAI. If one of those entities is mad they will sue, and the legal system works pretty well for fights between different capital holders. Doesn't really matter what the general public's opinion is.
Trump pardoned Trevor Milton today, who scammed investors out of millions doing things like his now infamous "rolling a truck down a hill to make it looks functional" demo.
Milton donated $1.8M to Trump, and Miltons lawyer's sister is Pam Bondi, the Attorney General.
This is nakedly corrupt and a strong signal that you can get away with all manner of financial fuckery if you are on Trumps "good list".
>Please don't use Hacker News for political or ideological battle. It tramples curiosity.
Comments like these are wildly off the original topic and practically invite the dead replies. As a rule of thumb, if you're about to put "/s" at the bottom of a post on an even remotely political topic, please reconsider. Especially if your sarcasm is already quite obvious, and obviously being used to bash a political outgroup.
"But that guy George Soros surely is up to no good!"
It's probably being spoken by some podcast that helped get Trump elected.
When they have an actual conspiracy, with actual billionaires paying the president and getting full access to the government, while getting public contracts... all of this being live streamed... they're still stuck in George Soros and the Deep State lizard people fantasy.
"Nice bank you've got there. Would be a shame if ________" (Insert any number of orders that Musk can have his friends in the executive branch issue to make life miserable for the bank principals.)
That makes me think of Jakob Fugger. He was so rich the pope borrowed money from him to build St. Peter's Basilica. And they got so desperate to pay it back they started selling indulgences, pissing off one Martin Luther and creating Protestantism: https://theconversation.com/the-man-who-gave-us-the-reformat...
And that makes me think of the Knights Templar. They were so rich that everybody borrowed money from them. The one day, the King of France decided he didn't want to repay the loan. The story doesn't end well for the Templars.
> A prominent international law firm reached a deal with President Donald Trump on Friday to dedicate at least $100 million in free legal services and to review its hiring practices, averting a punishing executive order like the ones directed at nearly a half-dozen other major legal institutions in recent weeks.
Wow, I thought the sum was $40 million, but that's what the other law firm paid that showed a lack of principles and caved...
And another law firm is being blackmailed because it used to employ someone who worked for Robert Mueller (of the Trump-Russia collusion investigation)... Geez Trump's team is actually busy, but busy settling old scores.
Then he buys the bank. DOGE is in the SEC now. Elon Musk is the regulator. If he decides that a bank is doing “fraud” and wants to shut it down, is there anyone to stop him? Serious question.
You realize the current administration is shutting down law firms that criticize Trump, right? They'll have zero problems going "do this deal if you know what's good for you".
And if you can get the right people to believe in the arbitrarily large numbers you invented out of thin air you can get away with just about anything because the wealthy don't have any real consequences.
>
So he just sold himself a company he already owns for a valuation that he himself assigned to that company but that was less than what he paid for it, and he paid entirely using “money” that has a made up value and which he issues himself?
And that is for sure either illegal or immoral. /s
I'm sorry, but calling out someone visible and public substance abuse problem isn't low. As someone who has dealt with addiction and its fallout since I was a very small child, I can emphatically say the man needs help first and foremost.
But, as the wealthiest man on the planet he's more likely to just be given what he wants: more self-indulgence. When you surround yourself with yes-men and sycophants, actual help isn't likely.
Further, it's entirely right to call this out when his actions impact the rest of the world greatly and the man has obvious problems. To then try and turn it around on me as if I'd done something wrong by pointing out the Emperor has no clothes? Well, I could offer you some choice words, but I'll hold my tongue. However, in my estimation, you could do with some self-reflection and probably a bit less "taste of boot on your tongue".
Did you not watch them land the starship? That's easily the biggest space-faring accomplishment since Apollo, and certainly not something NASA could replicate in the foreseeable future.
Speaking of the moon, NASA's SLS is projected to cost several orders of magnitude more than a super heavy launch, and is only aiming for the moon as opposed to Mars.
If there's one place that Doge could really, actually stop a lot of waste and fraud, it's at NASA. Of course, that would be the conflict of interest par excellence, and face a bunch of opposition from red-state congressmen with huge contracts in their constituencies. Objectively speaking, though, it's a huge waste of taxpayer money.
NASA/DoD did lay some of the groundwork. DC-X was a vertical landing rocket meant for reuse nearly 35 years ago. Granted SpaceX has done amazing things that are more difficult (DC-X was suborbital), but I tend to think if NASA continued they would have got there. From my perspective, SpaceX’s major benefit is they don’t have to follow the same rules as NASA so they can do things quicker and/or cheaper.
The “waste” is really just a different risk tolerance. You could make many of the NASA requirements go away, but nobody wants to be the one who signs up for that when the next disaster happens.
The waste does not at all stem only from different risk tolerances. SpaceX launches NASA astronauts which means that they also need to comply to the same standards. Pork barrel projects like SLS is the real reason why everything NASA does is so expensive and late.
The statement that NASA would have achieved reuse eventually is weird considering that NASA still exists today, 35 years later, without succeeding.
>SpaceX launches NASA astronauts which means that they also need to comply to the same standards
Sorry, this is false. When NASA engineers have raised the question of non-adherence to NASA standards by CCP contractors, they were told it wasn’t their role to dictate those kinds of requirements. You can see this in a number of mishaps, like when a strut failure resulted in a lost rocket because they didn’t want to follow well-established and codified aerospace supply chain quality standards. NASA is buying a service with CCP, not a product. This says nothing of the political requirements NASA must work through that contractors do not.
>The statement that NASA would have achieved reuse eventually is weird considering that NASA still exists today, 35 years later, without succeeding.
NASA does, but that NASA VTOL rocket program was cancelled in 1996. My point was that the tech was feasible for NASA, but not a priority.
I agree Falcon 9 is showing itself to be reliable and low cost. We probably agree about the pork piece too
You’re missing the point (which seems to be a common thread on this) so before I spend too much time constantly reiterating: 1) What do you think is the goal of NASA and 2) What do you think is fundamentally different about CCP?
No, the point was about the differences in risk that facilitate that works. I agree that SpaceX has done wonderful things, but disagree about the overly simplification.
For example, the commenter uses the word “waste”, probably because they lack a nuanced understanding. NASA operates under different risk constraints than SpaceX. For example, they have to manage political risk which is why centers are spread across politically important states; that prevents funding from drying up. When a project is managed across different geographic locations, it creates funding stability at the cost of inefficiency. SpaceX doesn’t have the same problem, so they can skirt many risk reduction requirements, as well as consolidate operations to maximize efficiency. From that standpoint, both sides of the public/private partnership have unique roles. But people tend to want to color one as good and the other as bad because it fits easily into simple (but incorrect) mental models.
There are other differences in risk, but I’m already tired of typing.
Like most things, when people have an overly simple or dichotomous take of a complex issue, it usually belies an incomplete understanding. The OP started off with a claim that showed they don’t understand how the CCP works, and just kept digging.
No, you're right. NASA has already shown that we can go past our solar system, so... His company has done some really awesome stuff with the ships/rockets, though.
This move makes it more likely that the internal number for TSLA is not good, and Elon is expecting the price to go down.
He has access to the real revenue number. If it's going well, he wouldn't have to perform this maneuver. xAI was relatively separated from X and TSLA, and wasn't having the backlashes associated with the two. Now he risks having the xAI branding tarnished too. He wouldn't do this unless the TSLA internal numbers are bad and he has to protect himself first, at the cost of xAI brand.
It's interesting in conjunction with the SEC/DOGE move.
For ever, companies wanted to cook their own profitability metrics - see the famous (pre-Musk) Twitter revenue per click or something, or adjusted by size of community.
Public company disclosure rules, however, dictate fairly strictly what is and isn't revenue, profit, capital and so on. Right now, you can publish any wacky statistics you like, so long as you also provide the GAAP ones - "generally accepted accounting practice".
But who knows, perhaps DOGE in SEC relaxes that, giving companies more scope to hide bits of their business they don't like.
xAI was seperated from X in what sense? xAI employees were X employees [1]. X reportedly had a stake in xAI, although The Verge says that hasn't materialized yet [0]. xAI's primary UI was X.
(This is primarily around your backlash comments, I'm sure some shareholder malarkey could make them technically separate).
I’m not an expert in this but as far as I can tell there will never be a margin call. There’s only a margin call if he defaulted on his loans. All the banks will do is ask to restructure the loan to compensate for the loss in the collateral.
Further, it’s just $6bn which musk can easily cover.
> The funding included $7 billion of senior secured bank loans; $6 billion in subordinated debt; $6.25 billion in bank loans to Musk personally, secured by $62.5 billion of his Tesla stock; $20 billion in cash equity from Musk, to be provided by sales of Tesla stock and other assets; and $7.1 billion in equity from 19 independent investors.
Same thing that happens if you put up any kind of collateral that later becomes worthless: the lender doesn't get their money. That's the risk of collateral.
This is why mortgage lenders require you to maintain insurance on your property: if the house burns down or something, the lender still wants that money. If a house gets destroyed in a way that's not covered by insurance (say, by an earthquake in California, where most people don't have earthquake insurance), then the lender loses their money. (The former homeowner probably stops payments and gets their credit ruined.)
But you do know “things” have a way to find path to get in public :-). Also, as stated in the following article, Tesla filed with SEC how much of stock was used and you can use the timing to find the stock price during the period of acquisition.
Elon sold 19B in stock, took a loan for 6.25B, and the rest was other investors.
The 6.25B loan, assuming he still has it, is really not an issue considering his net worth. He can add more collateral or sell a bit. In fact TSLA stock is higher now than when he bought Twitter.
> xAI was relatively separated from X and TSLA, and wasn't having the backlashes associated with the two.
I don't understand this point: why would these backlashes care about the on-paper separation? (I'm assuming by backlash, you mean that of public opinion, which already knows about the xAI-Musk association).
Seems to me he's just scammed xAI investors, who thought they were investing in an AI company, into bailing him out of his failed Twitter purchase - they are now the idiots who paid $44B for Twitter (recently valued by Fidelity at $10B), and Musk gets his money back.
“Musk did not ask investors for approval but told them that the two companies had been collaborating closely and the integration would drive deeper integration with Grok.”
Unlike the shareholders of a company being acquired, the shareholders of an acquiring company do not need to be asked prior to the company making an acquisition.
IANAL, but this might be brought to court, if the company mission (as defined in their operating agreement) is to invest in AI, then buying X is not in the best interest of the company and not what the investors signed up for. It could be fraud.
Am a lawyer, this is an incredibly silly and unlikely thing to suggest for a for-profit company set up on behalf of an even mildly sophisticated party in the USA.
Nearly ever such company is "limited" to engage "in any lawful activity" so as avoid exactly this issue.
So your justification rests on the theories that a) Musk (Twitter) was denying Twitter data access to Musk (xAI), and b) Twitter data - a firehose of ill-informed flamewars and bot responses - would provide some incremental benefit to training a frontier model.
I thought I also heard that the people who agreed to buy Twitter's debt got the deal sweetened with some XAi stock.
Sooo, did that debt get paid off, and they got XAi stock. If so, buying that Tesla debt might not have been the complete bloodbath it should have been.
Fidelity valuing at $10B is ancient outdated news no longer reflective of reality, the value had skyrocketed in recent months, given the profits which now exceed profits as a public company. [1] [2]
In fact, Twitter debt is selling at 97% of value, indicating high confidence in the company. [3]
> Twitter debt is selling at 97% of value, indicating high confidence in the company
I helped some friends buy this debt. It has nothing to do with Twitter’s strength as an enterprise, but Musk’s brand as a political one. There is a great book on 90s Russia before Putin took power—the pre-Berezovsky playbook looks like the way to go in America right now.
Okay, I know Tesla's extremely high P/E ratio is because it's worth is not just tied to cars, and so xAI priced at $20B more than Anthropic does not necessarily mean xAI's AI products are that much better than Anthropic's (e.g. presumably xAI's worth is tied to synergies with Tesla FSD, Optimus, and maybe even Neurolink)...but what products does xAI actually offer, other than Grok being an add-on for premium X subscriptions?
Not only does the Grok API not have access to Grok 3, which was released more than a month ago, it doesn't even have it's own SDK? [0]
> Some of Grok users might have migrated from other LLM providers. xAI API is designed to be compatible with both OpenAI and Anthropic SDKs, except certain capabilities not offered by respective SDK. If you can use either SDKs, we recommend using OpenAI SDK for better stability.
(every code example has a call for `from openai import OpenAI`)
How would using Grok be viable for any enterprise? And if Grok's API is designed to be drop-in replacement for OpenAI's, how are they not able to just use Grok to whip up their own SDK variant based on OpenAI's open-sourced SDK [1] and API spec?
Not a fan of Grok by any means but an SDK isn't that much of a requirement. We use liteLLM as it gets really annoying to roll your own router when you have so many viable providers with various specialties.
Grok is also a stand-alone product with an optional $30/month subscription. Perhaps they are seeing a huge increase in usage here and are hoping that subscriptions follow.
The OpenAI library is used pretty much everywhere in the LLM world, every serious AI provider has an OpenAI-compatible API, or you can use something like OpenRouter which is also OpenAI-compatible. Standardization is good.
It bails out Elon and means his Tesla shares (borrowed against to purchase Twitter) won’t be liquidated as Tesla’s share price continues to decline, using xAI investor funds. He uses hype and sentiment (inflating valuations) in the capital markets to always stay slightly ahead of consequences.
Sure, but it's becoming increasingly obvious to everyone that the American car industry is in major trouble. In a decade, I'm confident in saying a lot of American car companies will not exist.
We see it in our day-to-day lives. People aren't buying new cars. Cars on the road are getting older and older. Views of Tesla continue to dwindle. Anything Stellantis is on life support. I mean, Chrysler has literally one car. GM is clawing for any sort of relevancy. And Ford is only afloat because of toxic masculinity. We all know that it's bad in the US, and we know outside of the US it's 100x times worse for these companies. We also know the US car market as a market is getting overshadowed.
It doesn't matter what stupid investors think. We can see the writing on the wall. These investors are delusional, period.
Tesla shares are higher than when Twitter was acquired. 'Continues to decline' sounds like weasel wording that the media likes to use to push a narrative that doesn't exist.
Edit: Comment flagged for pointing out inconvenient facts, it's wild out there
You forgot to mention that China, Vietnam, Thailand, and Indonesia are all betting big on EV production. China is of course the main competition, but it's telling just how stiff the competition is getting across the board. BYD is currently making more cars than Tesla, with more advanced battery technology and comparable build quality, for a fraction of the price of any Tesla.
Meanwhile Elon is too busy rage-tweeting and K-holing to work on any of the things Tesla promised it would do this year, like release a model 2 or something with robots
The auto tariffs are a present for Elon. Teslas are the most American of American cars, and while they do still use foreign parts they use the least out of everyone.
On top of that, in the EV category, Tesla is pretty much the only one made in the US.
Why would they continue to decline? If all that information is already known, why isn't it priced in and why isn't the best estimate of Tesla's price in 6 months equal to today's price plus the return of Treasuries?
Tesla's current P/E ratio is 134. To be a rational Tesla investor, you'd have to think it has almost 600% profit growth potential to reach the long-term American blue-chip average P/E of ~20.
That kind of growth would be difficult for a new entrant, but for an incumbent that's been around a while and already seeing sales decline, it's a pipe dream. Of course, it's not all about cars for Tesla. They're betting big on humanoid robots and "full self-driving", although they've been stuck at Level-2 self-driving for years and the robots, well... Let's just say we don't hear much about them for a reason.
Of course, Tesla has never been a company for rational investors. I used to hold a lot of Tesla stock back in 2017-19 when they had plenty of doubters. I remember seeing how Tesla owners would organize themselves grass-roots-style to show off their cars and convince others to go electric. The company was getting a ton of free marketing and had a very devoted customer base. My, how things have changed. Now, they have to shut down showrooms across the country due to "terrorism".
So where is the upside? Well, protectionism could help them in the US market, but they're a global company with stagnant sales in the US, so it's hard to see tariffs helping more than they'd hurt. And that's pretty much it for upside AFAICT.
It's true that Tesla shares recently declined, but the context is important: during 2022-2024 Tesla shares were trading between $100 and $300 (with high volatility), in October 2024 they were at $200-$250, then after elections they skyrocketed to the all time high of $488 (for no fundamental reason), and since then the stock is falling. It's $263 right now - after the latest declines the stock only returned to the price that's still higher than before the elections, and is higher than the 2022-2024 average (which was already unreasonably high and totally disconnected from earnings). So these declines are nothing, at least not yet.
FWIW there was a fundamental reason for shares to spike after the election: The elected regime was one that is very corrupt and self-serving, and was likely to do everything in its power to make money flow towards the companies it owns.
By now, though, it's seeming more like they're too incompetent to do that. They'll probably still do it, but they'll crash the whole economy at the same time so the money that's flowing to Tesla won't be worth a whole lot. But it was a reasonable prediction at the time.
That's fine if that is the argument (11/5/2024 vs today) vs all the gains since that period lost, I'm not willing to argue the point to death, the brand value destruction will continue. The fundamentals will catch up to the price eventually with enough pressure.
“Continues to decline” is a cushion for the next sentence “downgrade to sell” which cushions you from the ultimate, “new marketing leadership with Barron Trump and someone named Alien Brainrot”.
After the unprecedented move of the President of the United States anointing Musk as a made man and member of Donalds swamp, all from the White House. In additional multiple other highest members of Trump's government went on TV and said 'invest in Tesla'. That is not a healthy stock surge. It is a pure DC swamp play.
What do you mean by this? Do you not agree these events happened in an attempt to bring the stock back up? That government officials gave stock advice on TV that would cost financial advisors their licenses, for the benefit/as a favor to Musk (a billionaire), the very definition of DC swamp behavior, government officials doing illegal/immoral favors for their rich sponsors.
Not to be pedantic, but you’ve confused acceleration with velocity. How far you’ve traveled will depend on how long you’ve been falling, and what your starting velocity was.
Still, you have to give it to him, it works, and this has allowed him to do some incredible things beyond just hype.
What he's pulled off with xAI more recently is really quite incredible. And obviously this isn't first time Elon proved he can execute better almost anyone else.
I don't really have opinions on him as a person, but as a an entrepreneur you cant flaw him imo. He always finds a way to beat the odds.
>"He's a terrible human, but look at the model benchmarks!"
That's basically the response to deepseek? Aside from a few people pearl clutching about "chinese propaganda" or whatever, most people praised its efficiency and performance on benchmarks. Credit where credit is due. Also note that China is an authoritarian regime where there's no separation between the state and private enterprise. Every company of non-negligible size has a CCP committee inside of it.
You don't have to meet someone to know they're awful. I've never met Adolf Hitler - but I'm pretty confident he's an awful person.
Elon Musk uses his immense wealth to cheat. He's infiltrated the government and uses his power to directly harm Americans, in order to further enrich himself. In addition, almost everyone who has worked for him has corroborated that he is an awful boss.
He is also prone to dishonesty. When confronted with something that requires accountability, his strategy is to protect his lies with newer lies. FSD, the state of twitter, DOGE, and on and on. He is so dishonest that it's almost always safer to assume he is lying than to give the benefit of the doubt.
But, even on a personal level, he struggles to stay afloat. He has impregnated multiple woman and is practically forming an army of illegitimate children. Those who were close to him either speak of him with extreme disdain or not at all. The only child he has any connection to is used as nothing more than a political pawn.
The only reason anyone even thinks he might be okay is because he's rich. We tend to have an extreme bias in favor of the wealthy, almost akin to a brainwashing. The reality is being rich does not correlate with being moral or decent. It doesn't correlate with being intelligent either, but that's a separate conversation.
I know I'm late to reply, but to explain since many people seemed to be confused by what I said –– I think the speed at which xAI has caught up with the competition from nothing is quite impressive, and the lengths they had to go to to do this, even more so.
Grok is now competitive with the other big players in the foundation model space. To do this they had to recruit some of the top AI talent, speed run the building of massive AI data centers and of course execute well to bring it all together.
All of their competition have either had a time and/or financial advantage over xAI so it's quite impressive what they've managed to achieve given this. Deepseek's achievement in this sense is more impressive so I'm not delusional, but I was still very surprised to see how good Grok 2 was.
Weren't they already doing that? I recall before I bailed from X/Twitter they already added an AI training consent toggle, which silently defaulted to "I consent" for all existing users of course.
> I recall before I bailed from X/Twitter they already added an AI training consent toggle, which silently defaulted to "I consent" for all existing users of course.
There's a solution for that: build a Twitter bot that posts strange things.
I don’t really see how X data, being riddled with spam and bots, is all that uniquely useful to an AI company. Even if it was, it’s not all that clear that access to data is a defensible moat.
So he can use the funds he raised for xAI to pay out the lenders for the initial Twitter purchase? Otherwise the lenders are just getting xAI stock (all stock deal) which I assume is illiquid?
A stock ponzi scheme to keep him afloat? Soon he will start a new venture and use that venture to save the previous venture and so on. Maybe a robot clothing company because robots shouldn't be naked.
Seems like anyone who has three "shares" of X now has 1 share of xAI+X, which by Musk's valuation is three times as valuable as X. Assuming the xAI share price is wildly inflated, it seems that the inflated valuation has devalued their actual holdings.
Eg, for an extreme example, if xAI is worth zero, their actual holdings are now a third of what they were.
And he scammed the taxpayers of New York State for a billion dollar factory to build solar roofs. Factory built, stock was pumped, no solar roofs though.
The puffery about waste and fraud is pure projection coming from a scammer like Musk.
Who also talks like Sam Altman that the human race will need to all be on welfare (Universal Basic Income) because of AI.
I don't understand it all ...cut people's jobs who make multitudes of billions less (cut 25k probationary employees like ripping off a band-aid), want people to work like the Chinese do (day and night) so we are the leader in AI (?) and after AI starts replacing jobs we all need to be on a welfare system. Isn't a welfare system the biggest waste to the Republican party (independent here)?
Does he even know his end game with all this or he's just having fun be the most powerful person?
So the real story here is that he was in danger of getting margin called on the loan he took to buy Twitter which he financed with TSLA shares as collateral, and this is him moving money around so he doesn't have to face the reality of actually getting margin called amid a sinking TSLA, right?
There's two issues with that theory: (a) Somebody in another thread mentioned that margin for those loans would trigger at around $120, so assuming that's true TSLA has another 50% to lose before it would happen. (b) Even if that was the case and TSLA lost those 50%, that would mean he'd have to cover the loans with cash. He cannot use xAI shares for that because contrary to TSLA it is not a publicly traded company. There is no open market price that lenders could accept. So, he didn't gain anything by moving money around, he'd still need to get the cash from somewhere.
Twitter started with $13 billion in debt and now has $12 billion, so was only able to make $1 billion in profit in about two and a half years. Twitter was making around $500 billion a quarter before the Apple ad targeting changes that Meta was able to recover from back to more than their profitability before the changes, so if Twitter only got back to ~$100 billion a quarter they failed pretty hard in comparison to Meta despite how much more efficient they were supposed to be, but he got political control out of it, and now acquired a ton of political control from poaching Tesla AI employees from himself for a new startup during the biggest AI boom in history with no significant further development of Tesla's AI training hardware and many of Tesla's top researchers moved over.
Virtually all of his wealth is in the stock of his companies.
He can't sell large amounts of stock in one go or it would trigger the price to crater.
Rich people with lots of wealth tied up in stocks will often borrow money from banks at low interest rates and use stock as collateral. This is common knowledge.
If the stock dips too much, the bank can call in the loan/make him put up more collateral, because the original collateral is worth less.
Elon does not have billions in cash or other liquid capital just sitting around. He would need to sell a lot of stock to see that money and that would cause him a lot of problems.
Yeah basically. I don’t know that he was fearing a direct margin call but this is pretty blatantly just using the xai entity to save the x entity so it doesn’t endanger his Tesla house of cards. And it’s obvious in these comments who has really worked with a lot of privately held mildly shady sister companies deeply enough to understand these kinds of deals and who is just arm-chairing.
I'm not sure the SEC would obviously have jurisdiction, since neither Twitter nor xAI were public companies. The FTC might care about such a merger, however, and I suppose minority investors in xAI would have some ability to file a lawsuit if they think that X was acquired over its fair value.
> I'm not sure the SEC would obviously have jurisdiction, since neither Twitter nor xAI were public companies.
The Securities and Exchange Commission deals with private securities, and also with public securities exchanges and the firms listed on them. Public firms have more oversight from the SEC, but private securities are not outside of their purview.
This is a very mistaken impression, the SEC certainly is the regulator with jurisdiction over private share trades. The onus for reporting is just much higher for public companies.
What do you mean, what's going on? The judge rejected Musk's motion to dismiss the lawsuit. Meaning that the suit against him is going forward. Which is the correct outcome, because yeah he's obviously guilty.
More likely Musk liked xAI's CTO more than X's CTO, and parted ways with one of them. Which is his prerogative, as the owner of both companies. I'm sure Haofei would love to be the CTO of one of the strongest AI models in existence. I would, if I were in his shoes.
We're at the point now where any heavily monetized player can build one of the strongest models. I mean, especially with all of the incredibly open Chinese companies releasing cutting edge research now that most American firms have gone quiet or only releasing their tailings.
See the leaderboard tab here: https://lmarena.ai. Or just try it. It's excellent. Usage is free of charge so far. Subjectively, on my prompts, it seems substantially stronger than GPT 4o and 4.5. I also like its more "informal" tone, and its willingness to discuss the more controversial topics.
Ask any mainstream U.S. model anything remotely sexual and they all abort. Musk et al. claim they want free speech and no censorship, yet the U.S. evangelicals have their teeth so deep into the tech, that they block it or debank anyone who even remotely suggests women should have a pleasurable sexual experience.
I think it’s important to not support products by people who want to destroy democracy and who openly sieg heiling or claiming Hitler wasn’t responsible for the Holocaust.
But we are at a point in history where everyone who believes in upholding democratic values needs to call out those in power who are actively trying to destroy it.
Vote with your wallet.
And it’s risky to build your product on top of Grok’s platform, because its owner is totally unstable and you don’t want to be exposed to ketamine fuelled decision making that could negatively impact your business.
On the bright side, Google's new Gemini-2.5-pro comes with no Holocaust-denying issues, and is definitely a lot better than Grok, and is also free and fast.
(I've been using it the past 2 days and am pretty impressed - the first high-end Google model I'd willingly use instead of GPT-4.5 or Claude-3.7.)
The Gemini models have become notorious for being rather uncensored and unrestricted, with an oddly base-model-like feel, since at least last November.
I was confused when xAI was started as a separate company. Twitter had the data, the delivery surface, the user base. I wondered why a separate entity was created to house the AI part.
I should have had a clue because I was talking to a CEO of a startup and trying to encourage him to invest dev time in AI features. He was reluctant even though he was optimistic about AI. He had too many things to work on, not enough resources. I suggested he raise more capital. He pointed out that raising capital in an older startup would mean people scrutinize your revenue growth. He would be able to raise more money at a better valuation for a completely new AI business than he could possibly raise to inject cash into his existing traditional startup.
So this makes sense of my initial confusion. I am just surprised it happened so fast.
Marc Andreessen made headlines a few months ago during the campaign about some shadowy meeting he was brought in about AI. He claimed the government told him they had picked a few winners of the AI race and no new foundational startups would be allowed to compete. Everyone has been talking about a "Manhattan project" like push for AGI to make sure the US gets it before anyone else. Given how quickly xAI has risen, given it's access to massive GPU resources, I can't help but reach for my tinfoil hat here. A platform with the reach of X/Twitter combined with an AI is a technocratic wet dream.
Is it weird that if I do not have an account on X, I also have no idea what X actually is? If I go to the home page, it just says "Happening now". No idea what that means though. If I then navigate to the tiny "About" link, I'm not getting any smarter. The "About the company" page takes to a 404. So, unless you know already what X is, you have no obvious way to find out what it is either.
Today it’s primarily porn site where you can also discuss sports and post Nazi memes while getting flooded with crypto scams.
There’s also a dwindling number of Silicon Valley influencers who still maintain the old pretense that it’s a globally important news forum and a place for serious people to interact. They’re an island in a rising sea of shit.
I’m genuinely hoping there’s something that pushes the AI/ML academic community off the site but until that happens it’s one of the better places to discover info
Yeah, I’ve been pretty disappointed to see the indie hacker community mostly remain there. Not sure what event would finally trigger the exodus at this point.
With the grok integration into X already being a thing and both being owned by Elon and called X it never really seemed like they were actually two different companies at any point so this is an interesting reminder that they were not.
A story about the most destructive man in the history of high technology (who is currently demolishing the future for most everyone on here) bilking his co-investors out of billions of dollars was allowed to stay up on Hacker News for two hours? Huh!
The only thing worse than investors assigning random made up valuations to their portfolio companies is owners themselves assigning random made up valuations to their companies.
>Trump, in the afterlife, gets permission to go back and visit Earth for one hour. He goes into a bar in NYC and asks the bartender how things are going for America. The amazed man says, "Wow, sir, we have the most incredible empire thanks to you! Greenland, Panama, and Canada!" "That's great," says Trump, "What about Europe?" "Oh yes," says the bartender, "They also couldn't resist us!" "That's so beautiful," says Trump. "Well, I have to go back now, how much do I owe you?" "One ruble and fifty kopeks," replies the bartender.
Puerto Rico and DC don't get to vote in Congressional elections. Well, not for seats that get votes, anyway. But yes, if PR and DC were granted statehood, we'd have 3 or 4 more Democrats in the Senate, and some number of new House districts, the majority of which likely sending Democrats to the House.
That's why Canada would be the 51st state. Only 2 senators for all of Canada, so not much increase in Democratic representation. Representatives would of course lean Democratic, but if Trump engineers a collapse in Canada's economy, some voters may be willing to vote Republican if they're promised a bailout, given the fait accompli of annexation. Plus, if the NDP sticks around, that's fewer Democratic representatives. Sure NDP would probably vote with Democrats in most situations, but it might be easier to peel their representatives away for crucial votes.
Greenland could probably be induced to vote Republican fairly easily, and so send 2 Republican senators to Congress.
I've just spitballing, of course - in the current situation the GOP is not in the position to throw away any advantage in the House.
I'd say someone has convinced him that Canada and Greenland will increase in value as the planet continues to warm, and this makes them 'at any cost' targets.
Why would they want to do that? Their base doesn't like Mexico or Mexicans. Keeping "Mexicans" (scare quotes because of course it's not just Mexicans who enter the US through the southern border) out of the US was a big part of Trump's platform.
He doesn't service the X loans with his Tesla stock. He does need to keep Tesla's stock above $115 or so in order to avoid getting margin-called, though. Sure, TSLA has been dropping, but it still has a ways to go before it hits $115. Maybe Musk is resigned to that happening, though, who knows. Seems unlikely?
This is probably a play to make X more invest-able, probably combined with some training data rule he foresees in the future.
Musk's companies have raison d'être, and the mergers (SCTY & TSLA) generally have one too.
X has been bleeding money, but has no access to cash. AI on the other hand he can peddle to sovereign wealth funds, apply for government grants, etc. X then becomes a write off against a larger company. xAI seems to be a pretty small company though; linkedin gives me 11-50 employees, which is pretty small for a DIY scaled LLM company worth (WHAT?!)...
Well some VCs are going to be happy. Or sad. Either way, they'll likely need to mark down their fund.
There's a lot of negativity here, but tbh, it makes complete sense. Grok and X are really tightly integrated already, and it was strange that they were separate enterprises to begin with. That part was odd.
The negativity is because he's using investor money in xAI in a related party transaction. He's negotiating both sides of the sale and it's not at all obvious the transaction price is a good or real price for Twitter. It may make sense to merge the two, but this is an unethical way to make a deal and I think it is likely the xAI investors are getting screwed.
I can understand that angle, but TBH, I have a hard time caring. They aren't a public company, and their private shareholders aren't lacking for resources to fight if they disagreed with this choice.
Oh yeah I totally agree with that framing. I find this fascinating intellectually because of the deal dynamics and worthy of critique but agree that the tone of some of the commentary is a bit silly. It's a really unethical thing to do, but it's all private capital and everyone with exposure knowingly made the choice to go into business with Musk. They can sue and definitely will win if Musk did cross any legal lines.
What makes it unethical? For all we know, the private investors are all in agreement on this. Musk tends to take capital from investors that he is on very good terms with. There's most likely a lot of overlap between investors of both companies.
Nearly the same thing as Google search can at this point, but maybe a better job of it. It isn't people's default choice at this point, but I'm having a hard time imagining people not trending toward it (or a competitor) over time.
And right now, Gemini's public models aren't cutting it.
$80B for Twitter+Grok is potentially a bargain, but it all depends on execution.
if this didn’t happen, how much more would TSLA have to drop for the $12B debt to get margin called given it is collateralized by TSLA? IIUC what has happened here is the debt has been repaid by selling xAI equity? Wasn’t xAI constructed in the first place to poof some magic money from thin air to give to unhappy Twitter investors and keep them happy?
How AI companies relatively cheap to keep running?
Aren't they well known to spend a lot in GPUs for training?
I always saw AI companies as actually quite relative expensive companies to keep running.
I wouldn't call the bitmex guys scammers. They were found guilty of not implementing proper anti money laundering regulations but didn't really steal money I think. They also invented perpetual futures which have been a very successful financial instrument. They were only sentenced to six months house arrest for Hayes and probation only for Delo, all served a while ago.
SBF on the other hand did bad stuff and has only served one year out of a 25 year sentence and I'd be a little surprised if he's out in a hurry.
I’m interested in understanding what happened to the debt. My simplistic understanding was that a bunch of the $13B debt raised for the twitter aq was secured by Tesla stock, with some sort of callable mechanism (which got a bit scary when Tesla stock sank).
I assume with this deal some of that debt got converted to equity ($1B?) and any callable mechanisms got repriced but I cannot find details to figure this out.
It should be noted that the other xAI shareholders are/were supportive of the X takeover and all. So although I personally don’t like Elon, this doesn’t seem like self dealing as many here claim. Solar City worked out well even though it too seemed like self dealing.
There are actually bad things to hate him for but acquisitions fraud is probably not on the table.
> It should be noted that the other xAI shareholders are/were supportive of the X takeover and all.
No xAI shareholder has any incentive to be honest about that. If they criticize it, Musk will cut them out of all future investments. And if they are an xAI shareholder, criticism may well be grounds for seizing their equity.
Particularly if they are an xAI employee: Musk companies usually have a equity contract & NDA which says that your options can be canceled at any time for $0, they can be bought back even if vested, you are not allowed to sell without their permission while they are private (ie. forever), and you are gagged about all this: https://techcrunch.com/2024/03/15/spacex-employee-stock-sale... (Similar to Altman's OpenAI NDAs and equity agreements that OAers were unpleasantly surprised to discover back around the coup.)
I wouldn't be surprised if most X investors were already investors in xAI anyway. Probably a big reason they got into X is for future investments and spacex.
What's the source / evidence for that? If the xAI shareholders really are all fine with it there's no ethical issue. But they have to be basically unanimously ok with the deal. Even a small investor has the right to not have their capital used for an insanely conflicted deal.
The WSJ article says that most of the minority non-musk investors of xAI are also non-Musk investors of Twitter. So they are self dealing as well. It is just one giant orgy of self dealing. Apologies about the mental image.
I'd feel great being someone that financed the takeover of X/Twitter, and being stuck with inflate shares in an also-ran AI play. Obviously there is no rule of law for Musk, and no recourse for them.
He'll keep his ball of twine rolling past TSLA's next earnings date on April 22nd.
Grok 3 is right up there with SOTA models and the time in which they trained it was fairly impressive. Seems like they have as good of a shot as anyone at capturing the market.
Because it is run by Elon Musk, and he hasn't shown any sign that he's no longer good any running things. His successful endeavors are the ones he neglects.
My understanding is that Google "owns" reddit in the sense that they paid to use it as source of training data. And goodle paid reddit so much that they have exclusive rights for that.
Probably this is the reason why all the reddit free public APIs are gone - to block scraping.
With that logic Github, StackOverflow, rest of internet is also "only" training data.
X just produces extra valuable training data as a byproduct. Like power plants create certain byproducts that can be sold etc. Good to see it going to Grok primarily, as other LLM's are far from being truth seeking with their built-in, documented, extreme bias.
That is irrelevant to the invalidity of your original statement. LLM's clearly don't have problems having their training data scraped from all those mentioned irregardless of their ownership.
Tangible reasoning: So they raised 40b from xAI and brought X. Since musk owns X, xAI doesn’t need to pay a premium. Investors of X gets xAI share instead.
Non tangible reasoning:
Since xAI uses data from X to train, and xAI likely will be used to explain and make new tweets. It makes the entire operation less complex. Elon is positioning X as the interface to the world and xAI will likely help control that. Remember he is gunning X to be an everything app and likely AI will be the core of how that will play out.
There must be some connection between this and the new equity funding last week, I would think?
March 19: "Elon Musk’s social network X has raised close to $1 billion in new equity from investors" "Musk himself participated in the equity raise" "The deal values X’s equity at roughly $32 billion." https://fortune.com/2025/03/19/elon-musk-x-twitter-equity-fu...
If nothing else, you want to do this merger after the check clears from some new investors, for two reasons: it provides a high valuation you can use to minimize the wasted equity, and because it is highly dilutive of X.ai shareholders to transfer a lot of their equity to a Twitter which is not remotely worth $44b, you want all shareholders in before you soak them in the merger, rather than after, when they can bail or demand revised terms which reflect the actual low value of Twitter now dragging down X.ai.
It may be valued 80B, it sure as hell isn't worth it. The AI is nothing special and has tons of competitors. The damaged Twitter brand isn't worth that much either.
Attorney and legal commentator Tristan Snell, via X: "Elon Musk's purchase of Twitter was financed by borrowing money. He used his Tesla stock as collateral. If Tesla stock keeps crashing, the banks/creditors could repossess Twitter."
I have five dollars in a box, and I buy a different box, also known to have five dollars in it, for the $5 in the first one. Now, according to this logic, I have a portfolio worth $10, since I still have the original box, worth $5 and the new one, also worth $5.
If I tried this at a gas station, I would be arrested if I got caught.
I think it’s more like: I have some paper that says I own 50% of a box T. People are willing to pay up to 10 cents to get 1% of that box T, so if I gave my paper to them, they’d give me $5.
I want to buy another box X for $1, so I go to a bank and ask for $1. To make sure I pay, I give them a paper saying they can take 10% of my original box T if I don’t pay them back.
I build another box A and people get excited. They say they’ll pay 5 cents for 1% of it, and I have a paper that says I own most of it.
Time passes and the amount people are willing to pay for the boxes changes, and at some point people are close to not believing box T is worth 10 cents per 1%. If that happens, the bank will want their 10%!
To prevent that, I decide to sell box X to box A. I pick the price I want for the sale, but the important part is that I make sure box A writes a new paper saying that the bank now has to get 20% of box A if box A fails to pay them, not box T anymore.
In the end, I can’t say I own box X anymore, but I never cared much for it. I only bought it as a meme. That’s okay though, because I don’t need to give any of my box T to the bank, and people are willing to pay 8 cents for 1% of my box A since it now owns box X too.
Also, you don't actually have $5 in either box, but you once sold a 1% ownership stake in each box for 5 cents. There's only 10 cents in the in the merged box, but you value it at $10.
Doesn't Tesla have their own "Dojo" custom AI chips? There seems to be a bit of pointless duplication either way between Tesla and X/xAI's developments in this space.
On the latest TSLA event, Elon said Dojo was 5% of their training compute (the rest being nvidia). Although he hoped future dojo versions would improve.
This is interesting and may point to X / Twitter becoming more AI-driven in the future (many possibilities). Grok has become my go-to AI -- I personally find it better than (the free version at least) of ChatGPT, paid Gemini, and anything else -- though it does have a lot of problems.
It's this maybe merely a financial move that makes sense in the world of ultra-rich people and banks?
I read somewhere that he used his tesla assets as a security to get a loan to buy X and this provides some buffer or sticks it to someone else in case tesla goes down?
I can't quite put my finger on it, as I'm no financial type, but this almost reeks of fraud or self-dealing. Wasn't X valued at something like 16 billion? What's that $33B in stock for?
So he bought Twitter for $44bn 2.5 years ago and has run it so badly that even when his own company bails it out using made up figures the best he can do is $33bn. Embarrassing. It's not much more than a pyramid scheme.
How is that legal? Could he also decide to sell a Bic pen he personally owns to XAI for 100 billion dollars? What's the line? Do you need to be able to convince a judge you truly believe it's worth that?
I just paid my wife $2.5 million to acquire our 1999 Saturn S-Series. Absolute classic car if anyone wants to buy it. I'll sell it for a clean $3 million.
Does anyone know who xAI's board of directors is now? I can't find reliable information online but it appears to be very small, maybe just two people (one of whom is Musk.)
All I can find is that it consists of two people, Elon Musk and Jared Birchall (wealth manager of Musk since 2016, CEO of Neuralink, "right hand man", etc)`
If there are others, it's likely to be representatives from firms like Sequoia Capital and Andreessen Horowitz?
It seems odd that xAI was able to raise $6B without offering a board seat to someone other than "Elon and Elon's personal money manager". But a lot of things about Musk's businesses are odd.
As a reminder, the people who held X's debt had written down the company's value to less than $10 billion. So selling your company to yourself for $45 billion dollars is hilarious chicanery.
Musk used his extremely overvalued company to bail out his other way overvalued company that he ran into the ground. It's a thinly-veiled, self dealing ponzi scheme. (It also echos the final fate of Solar City).
Another interesting bit of finance is X's last earnings were quite good but if you looked at what the sales consisted of I think about $500m was XAi paying to advertise/have Grok on X which seemed a bit iffy.
I see many people hating Musk too much for political reasons. The same people are pretty convinced that he does not know how to conduct business, that he is operating at a loss and he will tank every business he is involved in.
If that is the case, why don't this people put their money where their mouth is and invest everything they have in shorting Musk owned stocks like Tesla, SpaceX, xAI? They might have the chance to see their dream come true and Musk go broke and homeless.
Because even if Tesla/X are tending towards zero, the market will stay irrational longer than you can afford it. The horde of Musk idiot fans grows every day.
Just FYI, you can't expect intelligent conversations on HN about anything related to Elon Musk. A small vocal group really hate him, and we know that passion (especially if politically motivated) retards intelligence.
Shorting stock is difficult anyway ("markets can remain irrational longer than you can remain solvent"), and doubly so when you're betting against the co-president in a corrupt state.
Recently they were selling on the debt because its value had recovered close to par. But I don’t think this deal involved paying down any of that debt ahead of schedule.
What a sham of a person, companies, and legal and financial system.
How does a loser from South Africa, who has been kicked out of nearly every company, obtain this? Perhaps this is what every loser in America dreams about themselves being able to do.
Ah yes. Now we know why those articles about X's valuation resurgence have been coming out lately. He "rescued the value" by selling it to another company he owns.
Look, maybe the Twitter dataset and control over the algorithm is worth $45 billion. But I've seen the state of ads on Twitter these days and it is clearly not worth anything close to that from advertising income.
It's funny to me that ycombinator is basically reddit now, it's nearly 100% Elon hate, calling him a Nazi, etc. I get hating him but he literally just had a child with a Jewish woman, and as far as I know hasn't funded any gas chambers.
My take is that its super obvious X is a rapidly failing social media platform that is reportedly very dangerously leveraged with Tesla stock value... but xAI still has that Zombo.com magic where anything is possible and the unattainable is unknown.
Clearly the $44B price was too high for what it was really worth as a platform - Musk tried to get out of the deal, or at least decrease the price, but was forced to buy it at his initial offer by the courts. But I don't think there's any basis to say it's rapidly failing, at least from an engagement perspective - if BlueSky or Threads were going to kill X, they would have done so by now, or at least be well on their way. Besides, the real value of X is to seize control of a powerful propaganda platform from progressives, and in that he succeeded, maybe even beyond his wildest dreams.
What’s the point though if more and more real people delete the app and their accounts? He owns the equivalent of Lake Aral.
I gave up an early 5 letter word account on Twitter because I refuse to support a bully that has clear fascist intentions and the entire platform seemed to be turning into bots spouting racist Nazi tropes.
What suggests that? It seems neutral to me. It gained a billion dollar valuation since the acquisition. Ad revenue is returning back to the levels it was at. There were other revenue streams added to more effectively monetize it.
Elon bought Twitter for $44B, with a combination of his own money, money raised from investors, and $12B worth of debt secured by his Tesla shares.
Since that time Twitter's valuation continued to drop, and by late 2024 several investors (like Fidelity) had marked the company's overall value down to as little as $9B.
Now with the recent stock market turmoil and Tesla's massive share price drop, his Twitter loan is in danger of getting margin called, and that would spell disaster for Tesla, Twitter and his own finances.
Separately Elon also started xAI, which received $6B of funding at a $40B valuation, and is in talks to raise more.
So now he is doing some financial engineering to "sell" Twitter (X) to xAI. This means (1) whoever owns shares in Twitter can mark up their books again and (2) he can raise more funding for the combined entity and use that to pay off the Twitter loan.
Probably enough convincing math that trading 42% of stock for whole of Twitter is still good valuation play for future funding and maybe flipping it to someone else... Was xAI worth 57B at time of the sale?
This is the kind of crap we learned about when studying the "Robber Baron" era in the US public school system. Well, I mean, we were _supposed_ to learn it - evidently a lot of folks did not.
Inspiration for why to stay in school so that you too could become a robber baron. Like all history, learn the previous failings so that you can avoid them.
Thank you, that's a very fair point, and I apologize for my *-centric" viewpoint and such a short quip. That is not what we're aiming for in conversation on this site.
I took a giant shortcut, without providing sources, that was meant to indicate that we are in a situation that closely resembles the "Gilded Age" or "Robber Baron" era in the United States.
I was intending to point towards the actions of individuals in the analogous position of those "Robber Barons", in particular here, Elon Musk.
This dude used the data from Twitter, fed it to xAI (xAI spent lots of CapEx from investment on GPUs). Mix mid-"AI" training on such a ridiculously valuable dataset for free == cool models. Cool models + data stream of Doomscrolling == Higher valuation.
This just seems like a "nepo-baby" hit it big on some meme coin and bailed out Daddy.
Elon Musk is, essentially, bailing out himself using investor money from another company he runs by assigning a very highball evaluation to the company he's been destroying.
I don't know how you can get closer to the robber baron ideal than being able to distort the market like that.
I hope like the previous 20 years, his companies just get more and more successful. I like electric cars, and rockets, and AI, and tunnels, and brain implants, and less government spending, and real people with flaws.
I see a parallel in him and Trump that they artificially inflate the value of the things they own and get frequently away with it because they're just rich.
All private companies do that. Ever heard of Virgin? It's Branson's MO. Create a company with a high public profile that's private. Hype it up and sell it based on the value of it's perception. Watch it go out of business years later or be sold to someone else buying it for the name/market share to pad their own numbers for their own reports. At the very least it ends up being good for a a tax write off by the new owner. This is how business works.
I believe musk to be a fool and this reinforces that belief. It should not have taken him 3 years to realize that the value of Twitter was the hot and cold running stream of conversational data.
The fact that Elon Musk panicked and sold X to xAI means that he is believes Tesla stock, which backed the original X deal, is weak and will fall. It's a very bearish signal for TSLA.
This is highly speculative, but I've been comparing responses from five different AI models lately, including ChatGPT and Grok, and I've noticed something odd: The similarities in phrasing, structure, and political tone between ChatGPT and Grok are striking — much closer than you’d expect from two "rival" companies.
That led me down a rabbit hole, and here’s my working theory:
Despite the public feud between Sam Altman and Elon Musk, I believe OpenAI and xAI are quietly collaborating behind the scenes. Specifically, I suspect Grok is either running OpenAI-derived models or sharing infrastructure, and in return, OpenAI is gaining access to Musk’s massive data/compute resources via xAI and X (formerly Twitter).
Supporting points:
Microsoft is stepping away — They were OpenAI’s primary compute partner but have started signaling they’ll use other providers.
Grok’s rapid development — It came online way faster than would be realistic for a startup AI lab with no prior foundation.
Massive hardware investment by xAI — If OpenAI was looking for non-Microsoft compute, xAI could quietly be the supplier.
Grok's API being compatible with OpenAI’s SDK — suggests architectural overlap.
Recent political shift in ChatGPT’s answers — The model's tone has become more "centrist" or Musk-adjacent in the past year.
And now — Musk just merged X and xAI, combining their compute, data, and models into one company. That move erases corporate barriers and would make a quiet collaboration much easier to conceal.
Why keep it secret? Because the brands are oil and water: OpenAI is publicly "woke"; Musk is toxic in mainstream circles. If users knew Grok was OpenAI-powered, Musk’s fan base would revolt. If OpenAI users knew they were working with Musk, the backlash would be massive.
It’s just a theory, but the pieces fit too well for me to ignore.
Curious if anyone else has noticed this or has data points to support or refute it.
Facebook is a product, Meta is a company. It was always weird to say Facebook in the context of Instagram, WhatsApp, Oculus etc. Heck who even uses Facebook now?
I also continue to say Twitter and prefer others to also do so because X is a terrible name to search for. It has too many common uses besides as the new name for Twitter so there are way too many false positives.
For example let's say you want to see all the times you've mentioned that site in your HN comment history. If you search for "author:tomcam twitter" in the search thingy at the bottom of most HN pages it turns up 34 comments and it looks like all of them are actually about that site or contained links to content on that site.
Change that to "author:tomcam x" and there are 13 comments. Only 4 of those are using X to mean Twitter. The x in the others come from OS-X, X-rated (in two comments), 2796 x 1290, x.into(), X.js, X-Files (in two comments), 4 x 8.
Because I'm not about to hand over one of the 26 essential letters of our alphabet to corporate whims. "Twitter" emerged as a fresh term because people embraced it—not because a billionaire decreed it. Whether it's naming a service or renaming a gulf , words—and especially their letters—belong to the public, not to the power of a few billionaires..
"This will allow us to build a platform that doesn’t just reflect the world but actively accelerates human progress"
You get to pick winners AND be protected by section 230 of the Communications Decency Act from liability for anything said on the platform.
Stockholder privacy is protected by law; they could be Russian, Saudi, Chinese, North Korean crypto-currency hackers; CIA; friends of friends, mom and pop, whomever.
X algorithms and work practices are protected by trade secrets, confidentiality agreements, and binding arbitration.
Even superpower-nation security services are deeply dependent on the willing participation of the telecommunications industry. They would be blind to a unwilling provider, particularly one with their own worldwide network.
Don't blame Elon Musk. We built this system. "If you build it, they will come."
(Edit: I acknowledge the downvote and normally delete if/since judged not helpful. But I would appreciate it if the flaws were pointed out explicitly: a category mistake in ascribing personal responsibility for collective effects? assuming the worst, or fear-mongering? just hyperventilating? I honestly don't want to waste anyone's time. I thought pointing out that legal protections necessary for companies could be so abused would stimulate the policy-minded.)
>You get to pick winners AND be protected by section 230 of the Communications Decency Act from liability
That should be, and i thought was, prohibited. Either you're a common carrier (and protected as such) or you're editorializing. Unfortunately the enforcement seems to be lacking more and more, and that even without considering that Musk is probably not subject to any enforcement these days.
Hillarious. He wrote his own press release to pretend like he didn't just buy his privately held company using his publicly held company shares.
He's an idiot but I'll give him some credit, he just dumped a bunch if shares at their inflated value before they could drop even more. The guys he conned into buying Twitter with him won't have a reason to seek revenge now, and he can make whatever bullshit claims about the value if X he wants, since it's a private sale.
He did roughly the same thing with Telsa acquiring Solar Winds. Musk's Net worth is smoke and mirrors.
He has done this move before with Tesla buying Solar City. When you do a deal with yourself you can assign any value you want to assets, it isn’t a competitive process. In the previous case Solar City was dying but its acquisition by Tesla was pitched as a great synergy.
https://www.businessinsider.com/solarcity-tesla-energy-belea...
There were a few lawsuits from Tesla shareholders about the acquisition regarding self dealing but they didn’t succeed:
https://en.wikipedia.org/wiki/SolarCity
You’re burying the lede here, which is that the Delaware Chancery Court rules that Tesla had paid a fair price for Solar City: https://www.businessinsider.com/elon-musk-wins-solarcity-tes...
OP mentions the lawsuits did not succeed
Its not like the courts are investment banks with an evaluation arm. They are just judging if anything reaches the point where shareholders were legally harmed, which still gives a lot of gray area to the acquiring company.
Lawsuits can fail for lots of reasons without a decision on the merits. It seems relevant that the reason the lawsuit failed is because the court looked at the fairness of the transaction and determined that Tesla paid a fair price.
This whole thread is true consistent statements that differ only in emphasis.
> differ only in emphasis
The commenter you are responding to is explicitly intending to place more emphasis on the reason why the lawsuit failed. That is why they used the phrase “burying the lede” in their initial comment.
True!
Hold on, I feel like everyone's missing that theres a real argument here. I think the key point was:
>They are just judging if anything reaches the point where shareholders were legally harmed, which still gives a lot of gray area to the acquiring company.
This distinguishes the lawsuit failing from the idea that a fair price was paid. The competing contentions are (a) fair price vs (b) unfair but beneath threshold of legally punishable harm.
Note that this is a civil suit, so the concept of a “threshold of legally punishable harm” doesn’t apply. There’s no “punishment,” and the plaintiff doesn’t need to meet the high standards (proof beyond a reasonable doubt, etc.) for imposing a punishment.
Under Delaware law, there’s two standards for evaluating this kind of claim. When there is no conflict of interest, the court applies the “business judgment rule,” which is similar to what you seem to be thinking—it gives corporate officers wide latitude.
But when there is a conflict of interest, the court applies the “entire fairness” standard, which requires both fair dealing and a fair price. And a fair price means what it sounds like—it’s what an objective businessman would consider a fair price under the circumstances. It doesn’t need to be the best price, but it must be within the range of fair. And to establish a fair price, the court relies on evidence from financial valuation experts. It’s a rigorous standard that’s hard to meet.
> And to establish a fair price, the court relies on evidence from financial valuation experts.
I generally find expert testimony to be suspect. Anyone can be trotted forward as an expert, rattle off their credentials, and say whatever they feel like saying, depending on who is paying them to testify. And financial valuation is not a science; there is of course plenty of math involved that takes into account hard, objective numbers, but a good chunk of it is opinion, too, as no one an know the future.
Having said that, the Delaware Chancery Court of course has more experience in these matters than any other state's courts, so I am of the opinion that they're less likely to be duped by "experts", but sill... it can and does happen.
I agree with you to a degree about expert testimony. But I’d argue that a Delaware Chancery Judge reviewing expert opinions from major investment banks is more likely to come to an accurate assessment than many other people offering view on the transaction. The legal ruling isn’t definitive for anything more than the case that was before the court, but I think it should be heavily weighted by anyone trying to inform their views about what happened.
I’d also point out that, in the legal industry, Delaware’s entire fairness standard is seen as a rigorous standard that typically results in victory for the plaintiff. The Chancery Court ruling resulted in various law firm updates using the case as an example of how the entire fairness standard isn’t always a death sentence for defendants.
The way to improved expert testimony would be to tie it to professional licensure in a stricter-than-practice way.
Ofc, that wouldn't help for software... because no licensure.
NCEES has brought back the controls systems professional engineering licensure. This is the same license that civil engineers use to stamp designs for example.
Of course, the license doesn’t mean anything if everyone falls under an industrial exemption. I’d be in favor of safety-critical software requiring a PE stamp.
I'm of the opinion that software should have licensure, given the degrading quality of software.
I'd say given the lack of professional consequences for unethical behavior. ;)
>I generally find expert testimony to be suspect
I have two feelings on this. One of which is alarm because it is a sentiment like this which is the backbone of misinformation believers and spreaders and we're in the worst era of misinformation I think that we've been in in a long time. Certainly the worst since the dawn of the digital age. Experts are right about vaccines. Right about building your savings with a 401k. They're right about using sunscreen. They're right about not ingesting too much sugar. They're right about reading to your kids from an early age and right about the impacts of tariffs on the economy. They're right about climate change. They're right about the Higgs Boson, etc. etc. In almost every case, the people going against the experts on these things are cranks, frauds, or confused conspiracy theorists.
But my other feeling is one of agreement in a very qualified sense. I believe that within the U.S. legal system, people who are presented as experts in certain forms of science, are able to invoke an unearned professional authority and legitimacy that has nothing in common with genuine expertise. When we talk about pseudoscience in the modern age, a lot of the time it's about new age crystals or evolution denial, but I think expert witnesses presented as authoritative in courtrooms have been responsible for generations upon generations of pseudoscience of various types. Everything from penmanship analysis to bite mark analysis to body language experts to, rather remarkably, supposed 911 phone call tonality analysis experts Who can include that wrongly timed emotional tremors or presence or absence of emotions prove the callers involvement in a crime.
And while it might be a gray area, I suspect there's at least a fair amount of crankery or motivated reasoning with hired gun economic experts summoned to Delaware courts to testify in favor of major corporate acquisitions.
I feel like this fixation on "punishment" as a legal term of art is not strictly necessary and my point can be reinterpreted in a charitable way that restates the same thing using different but functionally equivalent magic words.
So swap out "punishable" and instead say "legally actionable" (or other preferred synonym) and you nevertheless have an assessment that falls under what you noted is the entire fairness standard and the upshot is the same.
Also my understanding is that courts defer to the experts of the acquiring company. And if those experts are predisposed to have a favorable interpretation that favors the acquiring company, the valuation is in the less than optimal range of a range of values produced even by them, and they, by contrast to an actual market, might be much more lenient than a market would be in determining the price. So there's a convergence of variables that underscore the difference between fair as we conventionally understand the term (which is what we were all interested in here) and whatever it means to have survived legal scrutiny in Delaware.
Which again I would say means that this debate has real teeth and it's more than semantically equivalent differences in emphasis.
"Beyond a reasonable doubt" is the legal standard in criminal cases. "Preponderance of the evidence" is the standard in civil cases.
(c) no fair price can possibly be determined but the burden of proof lies with the claimant
(d) a court has no idea what a fair price would look like but made a finding of fact based on expert testimony despite being poorly situated to evaluate it
(e) the court in question answers to Delaware which is in the business of siding with any company that incorporates there.
That’s generous. One party is stubbornly missing that the Delaware court’s ruling is weak evidence of a proper valuation having been done, but wants to parrot an irrelevant textbook understanding that obfuscates that conclusion.
It's worth pointing out (IMHO) given the other comments that it's actually more than that - the fairness standard requires they prove the process was fair as well (IE a fair process that generated a fair price), which the court found they did as well.
(As you know, but others may not - this is not always the standard vs the business judgment rule, but is the standard here)
shareholder value maximization, shareholder value maximization über alles
I just wanna know where we can find these shareholders and evict them from earth because they're destroying everything.
Sadly, my pension
I have no holdings in armaments or instruments of torture, apparently. But that's about the most constraint I can apply, short of self-managing.
Easily-replaceable with the correctly shaped welfare-state, never fear!
You joke, I think, but I do think a solid welfare state delivers benefits that a mainstream economist would recognise. I fancy the long-term prospects if a country with a safety net higher than one without, all other things being equal. I see more inherent value in the public sector than the private.
Unfortunately the private sector has dominated the zeitgeist for decades; a kind of meta-regulatory-capture, if you will.
I can't trust that there will be a state pension waiting for me. So I'm in the private sector. Got some bonds in my mix, at least.
Reduced crime is the most obvious. People will eat. Wether they have to steal it or get it via a social safety net is up to society.
Those tend to invest in armaments and instruments of torture though
Arguably we'll never know. A court ruling that it's a fair price isn't the same as letting the market decide
This is true but it's not as far off as you think. In this case, the court doesn't have to just find it was a fair price, but a fair process as well.
That is, the standard the defendants have to meet (not the plaintiffs, the burden is actually on tesla here despite having been sued) is that the transaction was entirely fair to the corporation and shareholders- the process was a fair one, the price was a fair one, etc.
I have trouble thinking of a case where you can prove all this[1] but the market would have come up with something different. Almost by definition, if the market would have decided to pay a lower price, either the price or the process was probably not fair.
[1] Which again, you have to do affirmatively. You aren't just rebutting plaintiff evidence, the burden is on you to show the fairness
Even if there was a market, any market naturally requires adversarial decision making in the negotiation of a deal to have economic calculation (what we generally view the benefit we derive from a market in the first place).
When the same people are making the ask as making the buy, you literally cannot decouple the decision-making in a way that objectively eliminates cooperation.
A market cannot exist when the entities involved abandon adversarial decision-making and cooperate. One's priority is always suborned by one or the other.
How's Solar City doing now?
Not sure the court was capable of that judgement.
And what happened to Tesla solar roofs? Haven’t heard about those since like 2020. Who actually has one? And Tesla trucks? And full self-driving? And robotaxis? And the private venture around the moon?
It’s like everyone just forgets Musk’s announcements that never get delivered on.
> And what happened to Tesla solar roofs? Who actually has one?
Marques Brownlee:
https://www.youtube.com/watch?v=UJeSWbR6W04
They are expensive though, but nice looking.
> And Tesla trucks?
https://www.dhl.com/global-en/delivered/responsibility/dhl-t...
Tesla is currently building a dedicated factory in Nevada for the Semi Truck. Production is starting end of this year and ramping up in 2027.
https://www.youtube.com/watch?v=_2wjjWKj8Wo
Solar roof installs are continuing to grow. Slower than they hoped, but growing.
The semi factory will be finished late this year.
FSD gets better each month. Obviously there is massive debate if it will be “done” in 1, 2, 5, 10 or never years
Robotaxis were announced recently, the plan as announced is for them to be sold in 2026. That has not changed.
Looks like they’ll have some kind of driverless taxi service running this year with remote operators like Waymo.
Private moon mission was canned.
I think it’s pretty strange to say Musks promises never get delivered on when Tesla sells the most popular car on the planet two years running, spacex launches more to orbit than the rest of the world combined and a ton of other stuff.
Obviously he’s utterly nuts, and doesn’t deliver everything he talks about, and is very late on many things. But you have to be blind to say he never delivers anything.
We were supposed to have full self driving, sleep while it drives you car by 2019, not "the most popular car".
He addressed this. Elon "doesn’t deliver everything he talks about".
His point is that Elon may promise more than he delivers, but he has still delivered on quite a lot.
No, a self driving car can be either supervised or unsupervised.
I'm required to supervise my car while it drives me to work, but it is by definition fully self driving, controlling all aspects of the vehicle while I sit with hands off the wheel watching
Let's not move the goalposts. He promised unsupervised FSD for 2019 and he promised level 5 autonomy for 2020, they're still at level 2 autonomy.
Per https://motherfrunker.ca/fsd/
[2017] The sensor hardware and compute power required for at least level 4 to level 5 autonomy has been in every Tesla produced since October of last year.
[2017] I think that [you will be able to fall asleep in a Tesla] is about two years
[2018] Probably technically be able to [self deliver Teslas to customers doors] in about a year then its up to the regulators
[2019] We expect to be feature complete in self driving this year, and we expect to be confident enough from our standpoint to say that we think people do not need to touch the wheel and can look out the window sometime probably around the second quarter of next year.
[2020] Robotaxis release/deployment... Functionality still looking good for this year. Regulatory approval is the big unknown
[2020] I am extremely confident that level five or essentially complete autonomy will happen, and I think, will happen very quickly, I think at Tesla, I feel like we are very close to level five autonomy. I think—I remain confident that we will have the basic functionality for level five autonomy complete this year, There are no fundamental challenges remaining.
[2020] I'm extremely confident that Tesla will have level five next year, extremely confident, 100%
[2021] FSD will be capable of Level 5 autonomy by the end of 2021
My understanding is that the solar roofs are basically dead. They're more of a vanity project than a real product. The total production of the tiles is enough to cover like 10-20 houses a week and the full system price is around 5 times what a regular solar install costs, even when you factor in replacing the entire roof before doing the solar install.
> "Private moon mission was canned"
The project was unilaterally cancelled by the client, Yusaku Maezawa, in May 2024. Starship development had fallen significantly behind the original SpaceX aspirational date for the flight in 2023, and Maezawa's net worth had also halved since venture was announced in 2018.
https://en.wikipedia.org/wiki/DearMoon_project
> Obviously he’s utterly nuts
He takes risks very few others are willing to do, but he is not nuts by any reasonable definition.
How many children with how many women? How many disowned? False accusations of pedophilia against people he doesn’t know? Free speech absolutist who gleefully bans speech? Corporate acquirer who accidentally fires key people, and then makes the exact same mistake as a coup leader?
He is batshit. He is also smart and has accomplished some impressive things. The two are not incompatible.
> How many children with how many women? How many disowned?
That's common human behavior.
> False accusations of pedophilia against people he doesn’t know?
Against a single person who had just called him "insane" on TV. Not nuts at all.
> Free speech absolutist who gleefully bans speech?
Not all speech is free speech - you cannot advocate for hits on people, for example. Besides, it's perfectly legal to censor speech on his platform. Not nuts at all. Musk has made no attempt to suppress speech on Bluesky, Facebook, Reddit, Tiktok, etc.
> Corporate acquirer who accidentally fires key people
That's not how it worked. Twitter was losing money at an astonishing rate, and he had to cut expenses immediately. It is the fastest way to determine who was actually needed and who wasn't. Then hire back the ones who were actually needed.
> makes the exact same mistake as a coup leader?
It's the only way to do it when time is critical. It's also the only way when the agencies are doing everything possible to not cooperate with DOGE.
There's been no coup. Trump was lawfully elected.
Well, I hope the kool aid is tasty at least.
Do you ever stop and think it’s an amazing coincidence that every criticism of Musk is totally unfair?
When a criticism sounds like a substitute for the real reason a person hates Musk, it is totally unfair.
For example, where was the disgust at the person who publicly called Musk insane first? A fair criticism would have included that. A fair person would also be aware that there is not a single person on the planet who has not called someone else a nasty name.
In related news, I know you are, but what am I?
> Musk has made no attempt to suppress speech on Bluesky, Facebook, Reddit, Tiktok, etc.
Actually it just came out yesterday he did try to suppress free speech on Reddit.
> Musk has made no attempt to suppress speech on Bluesky, Facebook, Reddit, Tiktok, etc.
This is false if "etc." includes Wikipedia, on which Musk has attempted to suppress speech critical of him [1].
[1]: https://theweek.com/media/elon-musk-wikipedia-controversy
Musk made no attempt to use the courts or the law to bring down Wikipedia.
He did denounce Wikipedia, and called for people to not support it. That's not an attack on free speech.
Bad timing on your post. Just today, Elon tried to get content he didn't like taken down from Reddit, using specious legal reasoning: https://mashable.com/article/elon-musk-messaged-reddit-ceo-o...
Calling for public execution of DOGE personnel is not free speech.
https://x.com/elonmusk/status/1886501169154957587
Ah, so Musk must have X systematically taking down calls for public execution of his political enemies, then? This is a legit exception to free speech absolutism and he is just asking Reddit to do the same thing he does on his platform.
It's illegal to call for violence against others. It's also illegal to call for a violent attack against the government.
Great answers! Couldn’t agree more.
I’d argue he offsets his risks (but not profits) to the taxpayer. His high-risk bets have largely been buoyed by government contracts, subsidies, and borderline crony-capitalism. In many respects, that’s not always bad for the taxpayer when he delivers, but it’s not the same as being a free-market risk taker.
I recommend reading a biography of him. He did not offset risks to the taxpayer. SpaceX, for example, got contracts from NASA. He delivered on those contracts. If he hadn't, he would have gone bust, not the taxpayer.
At one point with Tesla he was within hours of business and personal bankruptcy, before making a deal with an investor. The investor wasn't the government.
The taxpayer never assumed a risk there.
> but not profits) to the taxpayer
He pays taxes on profits like anyone else.
You may want to familiarize yourself with counter examples from Musk biographers, like Seth Abramson.
Musk said himself SpaceX would’ve gone bankrupt without NASA contracts. He needed those contracts because Spacex was too high of a risk at the time for private business. NASA is self-insured. This is the the way the government supports high-risk nascent industries, because they are the only institution capable of shouldering that risk.
It’s well-established that the solvency of his companies are tightly coupled, just like TFA. Further, Tesla is made competitive by subsidies for EVs and manufacturing. Not necessarily bad, but the success isn’t occurring in a free-market vacuum. When companies accepting subsidies go under, the govt doesn’t typically get that money back, at least not in full. (See the faux Solyndra “scandal”)
I know that doesn’t fit the preferred narrative of the mythical free-market iconoclast succeeding in spite of the govt, but that’s reality.
On the profit side, I should have said he gets a disproportionate amount of profit and the taxpayer gets a disproportionate amount of risk.
> Musk said himself SpaceX would’ve gone bankrupt without NASA contracts.
And he wasn't paid until he delivered, like any contract with a business. The taxpayers were never at risk. It was not a subsidy.
Yes, Tesla benefited from EV subsidies, like all the electric car makers. He'd be stupid not to take the subsidy.
> You may want to familiarize yourself with counter examples from Musk biographers, like Seth Abramson.
I read "Elon Musk" by Ashlee Vance.
“And he wasn't paid until he delivered, like any contract with a business”
I don’t know the specifics of these contracts, but I very much doubt it based on my experience. That’s not how any Government development contract I’ve ever worked on has worked… There are startup payments, payments for milestones (including many at the start for various design stages before anything was built), payments at varying levels of build, etc… - often more than half (sometimes more than three quarters) of the contract value was paid before the final product was delivered.
We did some pretty cool things too (this was in defence satellite communications) but various Government customers took like 80% of the risk on the development most of our big products (obviously we had already proven our design abilities with smaller components but much smaller scale), which we would then sell to them and other Governments.
>The taxpayers were never at risk
I’d implore you to research more about how the CCP is administered. There are payments before any astronaut gets a ride. Meaning if the company goes out of business beforehand, the taxpayers lost that money without receiving the actual service intended. That’s also why NASA selected two CCP contractors, it distributes the risk. Maybe you think socializing risk to the taxpayer makes him a smart businessman, I just wish people would comes to terms with the fact that his wealth is inextricably linked to taxpayers. Like I said before, it’s not even necessarily a bad thing but call it what it is. I personally think the hybrid public-private arrangement works well when it’s not being abused.
Regardless of all that, the point was that Musk is not a paragon of free-market capitalism. Nothing you’ve pointed out negates that point, yet people still cling to that narrative for…reasons. I suspect it has more to do with cognitive biases than reality.
My house was built to my specification. The general contractor required that I make progress payments. He wanted to be sure he wouldn't be left holding the bag for all of it after I moved in (and he also needed cash to buy supplies and hire subcontractors). I took a risk he didn't just disappear with the up front payment.
When I had the roof replaced, I had to pay half up front.
And so on. This is normal business practice.
There is nothing not free market about progress payments.
(Besides, if NASA was fronting all the money, SpaceX wouldn't have gone bankrupt if the rocket blew up. But what I've read was Musk bet the company on it not blowing up.)
I decided to check one detail. The EV subsidy came in the form of a tax credit to the buyer, it is not paid to the car manufacturer. Musk had nothing to do with it.
> I suspect it has more to do with cognitive biases than reality.
Imagining oneself as dealing in reality rather than cognitive bias is yet another cognitive bias. Everything written about Musk is subject to cognitive bias one way or another.
You order an uber. You aren’t expected to make progressive payments so the driver can buy the car, get gas, etc. That’s the more appropriate analogy. As I said, CCP is a service contract, not a product. A house is a product so it even if the contractor goes out of business, you still have the foundations, studs, etc. ie your payments cover the partial product you are actually contracted to receive. A house is a misapplied analogy that belies some ignorance on the commercial crew program.
Businesses can leverage POs to fund operations. That’s why the NASA contract matters.
Yes, the EV subsidy goes to the buyer. The point was it makes the product more competitive at its price point. That point still stands. Besides, Tesla also benefited from multiple other taxpayer benefits. For example, they get hundreds of millions in tax incentives for their factories. Again, their profitability is propped up by taxpayers.
I’ve never claimed to be completely unbiased. However, we do have the benefit of testing out narratives with facts. The mental gymnastics needed to deny that these ventures/profits are somehow not related to taxpayers is, in a word, “nuts”
> You order an uber. You aren’t expected to make progressive payments so the driver can buy the car, get gas, etc. That’s the more appropriate analogy.
It's utterly inappropriate. First, your card is submitted and approved prior to you getting the ride. The uber is going to get that payment, you have no choice. Second, I wouldn't be surprised if the amount is put on hold with the credit card company before the ride begins - I know gas stations do this. Third, it's a trivial amount of money compared with buying a house. Fourth, the uber driver cannot operate if he hasn't already bought the car and the gas.
> That point still stands.
Musk had no control over it. The tax credit was given to the consumer. It also was for all EVs, it was not targeted at Musk.
> they get hundreds of millions in tax incentives for their factories. Again, their profitability is propped up by taxpayers.
A tax abatement is not a subsidy. A subsidy is a payment. Tax abatement is not "propped up" by other taxpayers, they did not get their taxes raised by it, and the company was not previously paying taxes for that location.
I'm curious why you (apparently) think that anyone could have done what Musk did? Why didn't you (or anyone else) get those subsidies and tax credits and contracts and create Tesla and SpaceX? I've read that Musk is an imbecile who somehow failed into being the richest entrepreneuer on Earth?
Tesla + SpaceX is worth about $1.2 trillion dollars. If the government started it with a billion dollars, consider all the taxes Tesla + SpaceX + Musk + employees + investors has paid since. Wow what a return on investment! And as a bonus, NASA gets to shoot off rockets that cost only 10% of NASA-built rockets.
>It's utterly inappropriate.
C'mon, this is bordering on a disingenuous argument. You can't acknowledge the different between a service and a product. That's literally the novelty of the CCP. In general practice, you don't pay for a service until after its rendered. But not the case in the NASA contract. If your Uber doesn't show up, you'll get reimbursed whatever small hold they put on. You're only out the service. If SpaceX went belly-up, NASA isn't getting milestone payments back and they don't get their ride. They're out payment and service.
>Musk had no control over it.
Are you claiming that subsidies don't get factored into a business plan? Again, the point is government action makes the business more competitive/profitable. Subsidies to the consumer absolutely impact that. Tesla's own filing acknowledge this point. E.g., they mention regulatory credits add $2.7B to their revenue. They also mention how consumer subsidies impact consumer demand for their cars, and how tax abatements are fundamental to projected operating expenses and financial obligations. Their own statements run afoul of the narrative you're defending.
>they did not get their taxes raised by it, and the company was not previously paying taxes for that location.
Correct. We agree the taxpayers are losing an income stream. If your house was built in a location, do you think you could claim "well there was nothing here before, so not paying income taxes is of no consequence"? It's a weird take if you think the public isn't offering something of value with beneficial tax breaks. If they are offering something of value, they are helping the business. I also agree the taxpayers can benefit from it, I don’t think they have to be in conflict, just acknowledged.
>I'm curious why you (apparently) think that anyone could have done what Musk did?
I've never claimed that, you seem to border on fanboy admiration of him. I think Musk is a once in a generation entrepreneur. I also think his business MO is heavily reliant on government contracts and special treatment. Those two aren't necessarily mutually exclusive. But the latter is contradictory to free-market ideals. That's the point that you're constantly side-stepping. Worship him if you want, but also acknowledge his success is tightly coupled to governmental help.
SpaceX has done amazing things. Buit I'm going to venture we have different opinions why. IMO, t's because they get to operate under different rules. I think the main advantage that NASA is buying is a plausible way to skirt a lot of the rules (political and technical) they must abide by. CCP does not, and that's largely why they can do things differently. That's not a guarantee of success (see: Boeing) but it sets the table.
You may not realize it, but we've had this same tired discussion a while ago. At that time, I said we will see Musk's business acumen with what he does with Twitter. Apropos of TFA, that doesn't currently put him in good light. 6 months ago it was valued at $9B, and then shortly later valued at $45B so that he could essentially sell it to himself at that valuation. At the very least, that indicates a lot of uncertainty. That is a suspect valuation, but to be generous there are some differential outcomes: 1) xAI becomes profitable largely due to the synergies from the sale of Twitter/X, 2) xAI is profitable in spite of the purchase, 3) xAI does not become profitable. It will be interesting to see, and I will be interested to see if we'll ever get insight into the private company to find out. It will also be interesting to see if future success is still coupled to government/political help; I suspect that's a drug hard to break from.
> his business MO is heavily reliant on government contracts and special treatment
He sells rockets to the government at 10% of what it would cost the government to buy them elsewhere. It's clearly Musk helping the government. Besides, Musk did not get subsidies for SpaceX nor special treatment.
> Are you claiming that subsidies don't get factored into a business plan?
No, I claimed that Musk had no control over the EV subsidy, which was given to buyers of electric cars from any company.
> acknowledge his success is tightly coupled to governmental help
Making a better, cheaper rocket is helping the government save tens of billions of dollars.
> contradictory to free-market ideals
The government keeps taking our economy farther and farther from the free market. Government taxes, subsidizes, and regulates. It isn't really possible to run a free market business in the US.
I know it's cool these days to dump on Musk and denigrate his achievements with "you didn't build that" (as if anyone else could have done it), but history will show him to be the greatest entrepreneuer the world has ever seen.
The government has subsidized other companies. None of them succeeded like Musk did. Not remotely. The idea that the government created Musk is just nonsense.
> buoyed by government contracts, subsidies, and borderline crony-capitalism
What you're describing is Lockheed, Boeing, Rockwell Collins, etc. SpaceX is the opposite--it provided NASA a service that was necessary for NASA to operate, at a fraction of the cost of competitors: https://ntrs.nasa.gov/citations/20200001093.
The fact that NASA makes interim payments on the contracts doesn't turn a purchase of services into a subsidy. "Free market" does not mean "off the shelf." It's extremely common in B2B settings for buyers to shoulder some up-front costs to develop products or services that aren't available in the market. For example, Apple made a large up-front payment to a supplier to speed up development of sapphire glass: https://www.cultofmac.com/apple-history/iphone-sapphire-glas....
Buyers take-on some risk when they do that, but that doesn't make it a subsidy. In Apple's case, they take on the risk in return for the bet that a supplier can provide them with huge volumes at a low price. In NASA's case, it took on some development risk because SpaceX promised a large reduction in launch costs.
I agree it applies to other contractors. My point is that the success is tightly coupled to the willingness of taxpayers to fund the operations.
You’re muddling points. I’m not saying the NASA contract was a subsidy. Tesla is a better example of subsidies.
No private capital was willing to contract to SpaceX until the risk was lowered. They’ve succeeded in doing so and deserve credit. However, they would have never gotten to that point without taxpayer dollars. Governments were the only institutions capable and willing of taking on that high initial risk. That point still stands. It’s odd that your stance denies that when Musk himself has admitted it.
Musk founded SpaceX with $100m along with other investors providing another $100m.
The payoff for government was getting rockets at 10% of the cost of other rockets.
You seem to be bent on have an altogether different discussion because you’re continuously missing the point. It’s exhausting, boring, and goes against HN guidelines about fostering a curious conversation.
> been buoyed by government contracts, subsidies, and borderline crony-capitalism
The government pays spacex to complete contracts. They pay tens of thousands of companies the same way - defence, bridges, trains, roads, etc. in fact, every government does this. It’s also worth pointing out spacex have completed those contracts much cheaper than competitors who have not delivered (ie star liner). As far as the gov giving out contracts for space stuff, spacex are literally the best option, and directly save taxpayers money.
Tesla gets subsided because the government wants to encourage EVs. Oil extraction and refining, corn, education, healthcare, defence and literally thousands of other sectors are also heavily subsidized. Again, every government in the world does this for sectors they want to encourage.
You are so hell bent on your “Musk bad” line you didn’t realize it has nothing to do with him or his companies. You are angry at how governments around the world pay for and subsidizes sectors every single day.
No, the Commercial Crew Program is fundamentally different than the way NASA has previously done business. They are buying a ride, not a rocket. Because it’s a service contract, it’s much more hands-off.
We agree the government supports sectors they want to encourage. See my previous comments about supporting high-risk nascent industries. That’s a different point than the one I was making, which is that support is a large part why those industries can exist during their initial high risk phase. My point is he is not a paragon of free-market capitalism because they rely on government support during high-risk stages. Both points can coexist. It also doesn’t imply I think he is “bad”.
You are trying to shoehorn a different discussion. I’ve never said Musk is bad. In fact, I’ve said he’s a once in a generation entrepreneur and that his companies have delivered wonderful things to the taxpayer. My claim is that his success is not the free-market ideal because it relies on government largesse. In your head, you appear to view it through a completely different lens because you seem to want to construct this “good vs bad” false narrative. The fact that you are bypassing the points reiterated multiple times isn’t conducive to a curious, nuanced, and thoughtful discussion
> Commercial Crew Program is fundamentally different than the way NASA has previously done business
It is exactly the same for SoaceX and Boeing, other than Boeing getting way more money for the same job.
Free-market capitalism is like the Easter bunny - a nice bedtime story for children. It doesn’t exist.
You still missed the point because you want to force this into a “SpaceX vs Everybody” narrative. I’ve already addressed the Boeing point. It still doesn’t negate the point about the industry needing government help/contracts to survive its early stages.
I don’t know why it’s difficult to actually read and critique the point being made, rather than constant digressions into others, but it makes for boring conversation. If you have a point that SpaceX didn’t need government contracts early, then make it. I’d be curious to hear it, but I don’t think the data supports it.
What part of defence contractors or train line builders or oil refineries or corn or sugar growers didn’t need government contracts and subsidies early?
You’re making out like SpaceX are doing something unique or morally wrong, when what they are doing is perfectly common, and the government couldn’t function without companies doing what spacex are doing.
Your message makes no sense. This is everyday stuff across the entire economy.
The only story Is that spacex saved the government (taxpayers) billions compared to paying Boeing who can’t even deliver.
Stop with the textbook whataboutism.
Also show me when I say SpaceX was doing something unique or morally wrong. Was it when I said other contractors do the same? Was it when I pointed out Boeing’s shortcomings? How any when I said SpaceX has done wonderful things for the taxpayer? Or how the public-private partnership works well?
Why do you insist on ignoring all the things we seem to agree on to fabricate an argument? Is it because you are incapable of admitting sometimes the government does good things? You are tilting at windmills, my friend.
So what ARE you saying?
Keep it concise and to the point. Make it worthwhile.
It’s all there in the OP. But since reading comprehension seemed to take a hit due to the need for arguing, I’ll reiterate:
His high-risk bets have largely been buoyed by government contracts
SpaceX wouldn’t have survived without govt intervention. I think the same can be said of Tesla to a lesser extent. That’s not bad, it’s the way things work with high-risk nascent industries.
You're good at this. Tell me how the Nazi salute, twice, on a national stage, wasn't nuts.
Nobody hates Musk because he's a nazi. He is called a nazi because they hate him.
He is supporting and promoting extreme-right parties all over Europe though. Like AfD in Germany, widely considered a nazi party.
He’s also never criticized (while busy criticizing European democracies) Russia or Putin, which are obviously nazi at this point.
I hate him because he's a Nazi, because of the Nazi salute.
I'll let you defend that.
Which part? That I hate Nazis or that when he did a Nazi salute, twice, that categories him as a Nazi?
Since you seem to champion him a lot, I'd really like to hear your take on his Nazi salute.
You're right. Not nuts. Utterly nuts. By any reasonable definition.
Explain.
No. It's blindingly obvious. You can be utterly incredible at delegation. You can be incredibly productive. You can also be utterly nuts. The utterly nuts part is self-evident to people who aren't temporarily impoverished billionaires and don't want to kiss his ass and be him. In my experience, that tends to include people who need it "explained". No disrespect.
Re-asserting that he's nuts is not an explanation.
> No disrespect.
But you disrespected me anyway :-)
You're welcome. Have a lovely Sunday.
What are you talking about? How about you spend like 2min doing research? Tesla solar roofs exist and are being deployed. Its just not the extreme growth market that Musk hopped for. And the trucks exist too.
The private moon mission is off because the costumer pulled out. But Starship is still in development and is contract with NASA for a moon mission.
Of course Robotaxi isn't close to existing.
> Of course Robotaxi isn't close to existing.
Musk announced in January that it was to launch in June, in Austin.
> Musk’s announcements that never get delivered on
And then there's the ones he did deliver on, like spectacular re-usable rockets, Starlink, Neuralink, etc.
Aren't Cyber trucks by Tesla? And FSD is basically here which means robotaxis are basically here. Now there are just regulatory hurdles and the long tail.
He made much the same claim 6 years ago: https://www.inverse.com/science/55141-elon-musk-autonomous-d...
"""“I feel very confident predicting autonomous robo taxis for Tesla by next year. Not in all jurisdictions, because we won’t have regulatory approval everywhere. But we will have regulatory approval at least at some point next year,” Musk said toward the end of the presentation. “From our standpoint, if you fast forward a year, maybe a year in three months, but next year for sure, we will have over a million robo taxis on the road.”""" - Musk, April 2019
> Aren't Cyber trucks by Tesla?
GP is referring to Tesla's promise to build electric semi trucks, not the pickup truck that Cybertruck is.
> And FSD is basically here which means robotaxis are basically here. Now there are just regulatory hurdles and the long tail.
AIUI, Tesla FSD is at best Level 3 automation (probably more like Level 2), which means it requires constant driver supervision to keep the car from committing suicide. That's pretty far from being "basically here", especially since Tesla seems extremely loth to accept any responsibility for FSD-related crashes.
FSD is level 2, because the human driver is required to pay attention and intervene at all times.
https://www.sae.org/binaries/content/gallery/cm/content/news...
In what sense of the word "basically" are the FSD and robotaxis "basically" here? Tesla FSD is a level 2 autonomic system that requires constant supervision, robotaxis would require level 4/5 autonomy. That's not even close to becoming reality.
FSD ran a red light last week.
But later today I’ll be heading out in a Waymo robotaxi which will actually be here.
"Basically here" and "actually here" tend to be decades apart ... especially in Musks case. Tho, I think another company can be actually capable to make them actually working.
Quite a claim. FSD in practice is nowhere close to actually being able to do robotaxi operations. So its not really a regulatory burden, other then regulatory actually checking if it works.
Exactly why do you believe a court that does exactly this kind of judgement all the time is not capable of it?
They issued a 127 page supporting decision on why they found it was a fair process that generated a fair price.
Want to say which part you take issue with that shows it was not capable of the judgement?
FWIW - I actually hate tesla, i just also hate the sort of drive by shitting on other fields that HN seems to do sometimes. If there are concrete reasons to believe they aren't capable, let's have that discussion. Otherwise, there's no need to denigrate others capabilities without evidence based on our feelings :)
you hate the company or the product? How does someone hate a company the open sourced all of their patents which resulted in creating a ton of competition in a previously dominated market?
Some people don't ignore the fraud, the terrible working conditions, the anti-competitive business practices, the unfulfilled promises, the stock price manipulation, and the cult of personality of a highly controversial leader just because of a marketing stunt from more than a decade ago which even Elon admits was not altruistic.
I'm a fan of Tesla's patent strategy. However, calling it "open source" isn't strictly correct. Patents are only free to use as long as you also give Tesla rights to all your patents.
That seems completely sane and fair
I agree it’s fair, but I don’t think it’s “open-source”. Open source means “free”; requiring me to give you something in return is transactional.
copy-left is referred to as open source and some even claim it's _more_ open source, but thanks for the information, I wasn't aware of the that detail.
edit: oh it's not copyleft, but specifically quid pro quo so tesla gives you their patents if you give them yours
Yes, it seems we need some kind of designation like copyleft for the context of patents or maybe already exists one.
Quid pro quo is well adjusted for the context.
A copy left style arrangement would require you to not enforce your patents against anyone who signs and upholds the agreement, not just with Tesla. If that was the case, I probably wouldn't have quibbled with the term "open source" being applied.
> is not capable of it?
> They issued a 127 page
I am sure they wrote a lot of words. But it kinda seems like they were wrong given the evidence.
Solar city shut down. The evidence shows that it was a poor acquisition.
So this is "I didn't read it at all, but i'm sure it's wrong because it conflicts with my personal view" then?
Quite the opposite. You were the one who brought up how many words they wrote, when we can just look at the glaringly obviously results which were there solar city failed.
I can just point to that huge failure that we can see right now.
Scandalous ?
"did not act unlawfully"
and
"paid a fair price"
are two entirely different things.
They are, but in the relevant Delaware law the latter point matters when there is a potential conflict of interest, so the Delaware court ruled on that.
The "fair price" standard and ruling is about both the process and the price. And the standard is likely not what most people would assume it to be, particularly as stated by the OP, resting on matters such as "was and is the transaction synergistic to Tesla?" It's also notable that the court found several process flaws created by Musk but ultimately determined the Tesla board was independent enough that it was likely fair.
Was it actually fair as evaluated by any outsider on first principles? Probably not. Was it criminally unfair? No.
It wasn’t a criminal case, and plaintiffs didn’t need to meet a high burden of proof. And Delaware’s entire fairness standard is a two-prong test that includes both fair dealing and fair price: https://en.wikipedia.org/wiki/Weinberger_v._UOP,_Inc.
The court ruled:
> Even assuming (without deciding) that Elon was Tesla’s controlling stockholder, the Tesla Board was conflicted, and the vote of the majority Tesla’s minority stockholders approving the Acquisition did not trigger business judgment review, such that entire fairness is the standard of review, the persuasive evidence reveals that the Acquisition was entirely fair…
> Equally if not more important, the preponderance of the evidence reveals that Tesla paid a fair price—SolarCity was, at a minimum, worth what Tesla paid for it, and the Acquisition otherwise was highly beneficial to Tesla. Indeed, the Acquisition marked a vital step forward for a company that had for years made clear to the market and its stockholders that it intended to expand from an electric car manufacturer to an alternative energy company. The Court’s verdict, therefore, is for the defense.
"The court made 11 factual findings showing that Musk had participated in the deal process to a degree greater than he should have."
"The trial court noted that these “process flaws flow[ed] principally from [Musk’s] apparent inability to acknowledge his clear conflict of interest and separate himself from Tesla’s consideration of the Acquisition."
"Upon recognizing these process flaws, the court then turned to what it identified as the strengths. It found six."
"Regarding fair dealing, the trial court noted that the road leading to the Acquisition was not entirely smooth. The court found, however,that the “Tesla Board meaningfully vetted the Acquisition” and Musk “did not impede the Tesla Board’s pursuit of a fair price.”Although Appellants assert that the court failed to make a finding of fair dealing, the court’s opinion can only reasonably be read and understood as concluding that the flaws did not overcome the findings of the process strengths and that the process, overall, was the product of fair dealing."
Read that as a ringing endorsement if you like.
What’s that got to do with the court’s ruling that Tesla paid a fair price, which is what I said in my OP? This is the relevant part of the opinion:
> In instances where there are process infirmities, the Court is obliged to study fair price even more carefully. I have done that here. After careful consideration, I am persuaded Elon presented credible evidence that Tesla paid a fair price for SolarCity. Plaintiffs answered by proffering incredible testimony that SolarCity was insolvent, and then provided some “also ran” theories on value that their experts did not ultimately endorse, or at least not persuasively so. Given this, I have no credible basis in the evidence to conclude that a “fairer price” was available, and therefore, no basis to conclude that the price paid was not entirely fair. Indeed, the price was, in my view, not “near the low end of a range of fairness,” but “entirely” fair in the truest sense of the word.
The ruling is based on price _and_ process by your own reference. You keep moving the goalposts. Which end do you want to play from? I thought not burying the lede was the scheme here?
Is that what a corporate lawyer would say?
Doesn’t mean it’s also a fair price this time
Any entity that can afford to invest billions of dollars can probably also afford to litigate if they see fit.
Regardless of the faith you have in the courts assessment time has shown the more critical opinion to be true. Solar City was a dead company, none of the promises they made has amounted to anything, they aren’t producing any products or revenue, and the deal has been shown to be self dealing in order to bail out his brother.
Where are the solar roof tiles? What’s happened to the tax payer funded factory in NY?
Indeed.
Grandparent is not correct, you can’t just assign “whatever” value in self-dealing transactions.
The SEC and IRS weren’t born yesterday. It reminds me of people who come up with basic self-dealing transactions with some tax benefit and act like the idea wasn’t around 100 years ago and that regulations aren’t already in place.
Surely a theoretically disgruntled xAI shareholder is going to have a harder time here since they're both private companies and given Elon's proximity to any potential regulators.
Company directors are generally given wide latitude in what they can do without breaching fiduciary duty, so such lawsuits were always going to be an uphill battle.
An acquisition is a special case (for the company being acquired) and the scrutiny is somewhat higher.
At least in Delaware. I have no idea what corporate law is like in Texas.
> I have no idea what corporate law is like in Texas.
Nobody does, really. Texas is relatively new to its 'corporate registration friendly' game, and at least on paper the statutory law is the same. Texas courts don't have to follow Delaware's case history, but it's also not a given that they will rule in a vastly more owner-friendly manner.
To add on to this, Texas as part of this pitch is the promise of less oversight and they not following Delaware’s lead is a plus
The judges may or may not have the same take on that matter as the legislature.
Is it realistic that Texas will decide to punish one of its most active companies ? Risking that they leave Texas for another state.
Private companies buying private companies is not heavily scrutinized in general by states, even in Delaware, especially non-public deals with no antitrust issues. The primary risk is stakeholders going through a state court if the company didn't follow standard rules.
No X shareholder in their right mind will object to getting a $45 billion valuation (including debt) when their latest valuations have the company at <$10 billion.
This is a stock transaction, so the $45 billion valuation is irrelevant unless you also believe the x.ai valuation.
What about an xAI shareholder who just paid $45 billion for a bag of rotten turnips?
I don't think there are that many of them, and I think most of them are very much under the "Musk" spell. This would be the party to sue to block this deal, and it seems unlikely that they will.
Twitter still has a lot of users and if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably. Now that's all gone because Twitter could investors need w own a small piece of the giant over inflated Xai, which has value because of AI hype but it's future actual value is questionable. There are so many other AI companies, so what is it that xai can do that justifies an $80 billion valuation?
> if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably.
That's a big if, and I think most people would be pretty skeptical of the possibility of that happening. The fact that outside investors seem to value it at under $10B suggests that's a common enough opinion.
To me, "make money" only implies financial sustainability. Do you take it to mean unicorn levels of cash?
I had an employer taken over by PE and shredded, for the crime of only managing 10% profit margin. Apparently, to some, if 20% of revenue doesn't go into someone's pocket, your business is a corpse. I think the world needs to chuck that attitude in the bin.
Opportunity cost is what the business can earn by investing in something else, usually something less risky than what the business is doing. If the business cannot earn more than the opportunity cost, it's a losing investment.
Businesses often use an opportunity cost of around 14%, so if the business is earning only 10%, then they are losing 4%.
For example, if you start a risky venture that earns 2%, when you could invest the money safely in bonds at 5%, it doesn't make sense to do the risky venture.
It's not an "attitude", it's maximizing the use of the money.
Understood. But what you have described is an attitude. Another possible attitude is being happy to lose money, hand over fist. Somewhere in between, there used to be a multi-billion company that made a piffling 10% margin on revenue.
You need some diversity in a system to remain able to change. Very homogenous populations are more likely to be wiped out in a crisis. Maximal efficiency is not maximal meta-efficiency.
This thinking by American business is why tariffs will never bring back whole sectors of manufacturing to US shores. It's not business American companies want to get involved with.
Business wants to get involved in any endeavor that makes a profit larger than the opportunity cost.
'if you start a ̶r̶i̶s̶k̶y̶ venture that earns 2%, when you could invest the money safely in bonds at 5%'
The US invented flat screen technology. The return on manufacturing didn't fit American business profit levels so they sold the technology off to overseas companies. Tariff's aren't going to fix that. They might artificially boost the return short term, but unless we are going permanent protected markets this sort of low return manufacturing isn't coming back, because of American management style, not 'Canada bad', not 'trade deals bad'. If anything a better cause statement would be to say 'American MBAs bad'.
A far more likely cause would be the costs of doing business offshore are lower.
The discussion way back when they interviewed executives about LCD patents/research being sold of was that they were just too low of a profit margin to bother pursuing. I believe it was a 60 Minutes piece but it may have been a nightly news piece at the time.
If business costs are lower offshore, that raises the profit margin for the busines to go there. It doesn't mean that offshore businesses accept lower margins.
>Twitter could get more users, sell advertising and make money probably
How'd that work out in the past with the previous owners?
Well: with the exception of Q1 2020 they were profitable from 2017 until Musk bought the company. Their last year was lower due to a lawsuit settlement but they were making significant profits until his acquisition added huge debt service obligations and tanked revenue.
https://www.businessofapps.com/data/twitter-statistics/ https://www.investing.com/academy/statistics/twitter-facts-s... https://dazeinfo.com/2020/07/30/twitter-global-net-income-by...
Long history of not being profitable - 2018 and 2019 feel like more of an anomaly than a trend.
Yes, like a lot of tech companies they weren’t focused on profits until their CEO prioritized it over growth but from that point on they were profitable from 2018 on, with the aforementioned bad quarter when everyone cut spending at the start of the pandemic. The one-time deferred lawsuit payout in 2021 masked what otherwise would have been several hundreds of millions in profit.
The problem people had understanding them was that they weren’t Facebook or Google. The expectations of a money-printing machine were unrealistic but they had a solid middle-tier business with a large number of solid customers.
Well, they found someone who valued it at $44 billion.
I think a great deal of that was because X owned a percentage of X.AI stock.
https://www.teslarati.com/x-investors-winning-big-elon-musk-...
https://archive.vn/F36yh
> so what is it that xai can do that justifies an $80 billion valuation?
Crush every competitor through regulation?
Actually I think that's a great observation! I hadn't thought of that one. But Facebook, open AI, Google, Microsoft have even more money than musk and I'm sure they wont allow that.
Maybe hoarding gpus?
https://sherwood.news/tech/companies-hoarding-nvidia-gpu-chi...
If anyone makes it work (whatever that means) in software they could buy it?
Those valuations are all bs though. They are hinged on traffic estimates and ad revenue.
X is clearly worth a lot more than just it's revenue would indicate.
What is the most influential social media site worth? Perhaps all of the money in the world...
X is now state-sponsored media, not social media. it provides political echochamber for some portion of the population and nothing more than that any longer
Every social media platform is, to some degree, an echo chamber. See Bluesky or Mastodon.
No other platform looks this bad
https://cdn.bsky.app/img/feed_fullsize/plain/did:plc:y5xyloy...
Where are the advertising dollars coming from on that horror show
Certainly not $45 BILLION of income over even a century
the one way you can look at $45bn is ability to buy election(s). as long as there are enough sheep orbiting that platform the value is there - in buying election(s)
neither is owned by a man deciding who can say what on the platform :)
And forces his posts also on people not wanting to follow him.
And whines/threats competing social networks when users post content critical of him and organize themselves to not share Twitter links.
Well, I would have suggested that you put your money where your mouth is and buy out Fidelity et al, but it looks like you're off the hook for that statement.
However, secondary markets for these megacorps are relatively liquid, so the valuations are not actually completely baseless.
X is worth whatever a state backed media is worth. If fascism in america succeeds, yeah, sure it's zillions of dollars.
But you'd have to be on the side of fascists to believe that.
Yes but the owners of X are all elon sycophants so I doubt they will have an issue with this (and honestly xAI stock is better than x stock)
Given how much they're typically paid for their trouble, you'd think they'd carry an ounce of responsibility for their actions.
Do regulators still have teeth in the US?
You mean the regulators threatened by DOGE?
"Surely a theoretically disgruntled xAI shareholder"
they know what they buying when elon promotes his lmao, elon twitter deal is backed by saudi. elon himself come to saudi asking for an investment from royal prince saudi
safe to say that if they want spent 40 billion for twitter, they would spent more with AI flavored company (they are saudi after all)
The only way to determine fair market value is by having a free market sale.
For example, I had a run-in with the property tax assessor. He assessed my house at an unreasonably high price. I filed a protest, and then had a conversation with him. I offered to sell him the house at a considerably lower price, and he could then flip it for what he assessed it at.
He refused.
I eventually did sell it, for considerably less than the assessed value.
As anyone following stocks knows, the fair market value of a company can vary dramatically minute by minute.
The solar city acquisition was for "only" $2.6 billion. This deal is way bigger. I'm not sure what the Tesla valuation was at the time of that deal, but I have to imagine it's proportionally way bigger too. A $45 billion acquisition when the acquirer, xAI, has an $80 billion valuation will threaten the integrity of xAI. Particularly because that's just a paper valuation and xAI doesn't have much of any revenue.
If I were an investor in xAI I would be furious about this. They're almost certainly overpaying for Twitter and there's definitely going to be litigation.
Edit: It sounds like the combined entity is taking on Twitter's $12 billion of debt from when it originally went private. As of last December xAI had raised "more than $12 billion" in total [1], so the deal attaches Twitter's debt to that ~12 billion pot of VC money. Unless I'm really misunderstanding something this deal looks like a bailout of Twitter and a huge new liability for xAI.
It's definitely possible my hot take is wrong and the xAI investors support the transaction. I hope so because if not there's going to be some brutal lawsuits over this.
[1] https://www.nytimes.com/2024/12/24/technology/elon-musk-xai-...
Just keep in mind this is all funny money !
The valuation of those 2 companies combined should be < $10 billions if we are very very generous.
X is heavily in debt, diminishing user base, and bleeding money. 0 profits
xAI is yet to make any actual revenues outside of ... X. Also bleeding money
Although I would admit, that these companies are not valued based by their economics, but rather on political power they provide to the owner.
As best I can tell the deal includes paying off $12 billion of Twitter debt. So that's real money, though that seems like it's basically all of the cash that xAI has raised, so if that's the case that's pretty wild.
Edit: I misread, Musk said it's an all-stock deal, so you're right, it's all funny money. I think that means the combined entity is taking on that debt. It's still great for Twitter and bad for xAI investors because the combined entity now has both the $12 billion debt and all the VC xAI raised.
Every time I see deals like this that are going to be such raw deals for the majority of those who invested it feels like a keen reminder that all the talk of market efficiency the pro caps in Washington talk about are full of it
This is a terrible and inefficient use of money. It’s inevitable that this paper house will fall over
Markets are plenty efficient. They’ve just lit billions of dollars on fire that used to belong to people stupid enough to believe in Elon Musk.
Tesla is still worth something like a forward PE of 90 and a trailing PE of 130, among plummeting sales and market share.
It's still wildly overvalued, and at it's unclear how long the market will stay irrational.
It's so hard to make predictions of Teslas value in today's political system! Musk is very very close to power, and it's impossible to say how that will play out. Will Tesla be the only car company without 25% tariffs? Will the government spend billions to buy Teslas? Or will Tesla die and Musk live of space-X?
He's not "close to power". He's cutting your nation into shreds, unopposed.
Megacorp market valuations are extremely bizarre because they're in a sense self-fulfilling. If your company has a market cap in the hundreds of billions of dollars then it has lower capital costs than competitors. If you want to build another factory, you're paying less in interest. Which means you can undercut the competition on price, or expand into grid storage or data centers etc.
Obviously you then have to actually do those things before the value crashes, so whether it works or not depends on whether investors continue to expect you to.
The current value fluctuations have more to do with politics than the company. The media is writing a lot of negative stories right now, but they also have the attention span of a goldfish and ultimately some new Current Thing will replace the existing one.
Ahhh, I dunno, musk is pretty good at fucking his own companies with Nazi salutes and wreckless incompetent destruction. Doesn't really take any big bad media to see what a fucknut musk is.
The media is the thing that characterizes it as "Nazi salutes" and "wreckless incompetent destruction".
The guy is an eccentric with autism, not an angel or the devil. He's not always right. But everything is so polarized right now that people are barely willing to concede that it's possible for someone to be right some of the time.
Teslas have the positive characteristics that they don't run on petroleum and have good safety ratings. They have the negative characteristics that they have privacy issues and you can't get parts or documentation to fix them yourself. A strong heuristic to tell if someone is using motivated reasoning is if the thing they're complaining about is an unrelated political hot button well-known to produce outrage (e.g. allegations of somehow simultaneously secret and open fascist ideology) as opposed to a way they're actually screwing someone illegitimately but in a way that doesn't cause most people to experience an immediate visceral response (e.g. mass surveillance, right to repair).
You can also tell it's that when the target is actually doing a bad thing, but the people objecting only care about the target and not anyone else doing the same thing. This is extremely common with corruption allegations. All corruption is bad, you need systems in place to constrain government officials from bilking the taxpayer, but this is a process problem where you need stronger checks and balances to prevent the government from transferring money to cronies, not a "we need to somehow elect only infallible humans" problem where what people actually mean is that they just want their guy to get in so the money goes to their cronies instead.
Cool story buddy. But musk is still a Nazi salute throwing fuckwad fool. I'm not buying the smirking excuses. He also happens to control a company producing government subsidized garbage pail cars. And he lies about their self-driving capability... over and over and over again. Mainly because he was too big of a fool to recognize that multimodal sensors are a good thing so he's about half a decade behind.
I prefer cars that don't get recalled for glued on pieces falling off and CEOs that didn't pay a quarter billion dollars to buy a presidency.
Plenty of other electric cars being produced by the other manufacturers.
I fail to see the efficiency part. Care to elaborate?
Garbage collection - although not pretty - is still necessary.
That isn’t efficient by any commonly understood definition of the word
Definitely great for the Twitter investors to be able to convert. I think they took a haircut relative to the 42B that they came in on, as the 45B includes the 12B debt. (42 gets reduced to 33, so 21-22% haircut) xAI also raised 6B in December last year at a 45B valuation, and then in February, reporting was that xAI was trying to raise 10B more at the 75B valuation... so this is where the frothiness of AI helps to mask the fundamentals. Can gets kicked down the road.
The are getting xAI stock instead of cash though and it's not really clear how liquid it will be.
Definitely, and a lot of that haircut actually happened in between when the deal was signed and when it closed, too. That was right when interest rates went up and Musk tried to wriggle out of the purchase agreement. So it's a great outcome for Twitter investors, assuming it sticks.
And assuming the xAI stock they traded their X stock for is worth anything.
Also - the wording on the deal: xAI being valued at 80B X being valued at 33B Is the xAI 80B number inclusive of the 33B (45B including debt)? That would back into xAI's valuation moving backwards since the December round. Usually when venture-backed companies tout a valuation after a capital raise, it's post-money... and they're not chest-thumping a 113B number (which they surely would have given 9 figures)
And.. looks like there was an update on the valuation from Bloomberg: Aggregate over 100B, but less than 113B due to some mingled ownership.
https://archive.is/esoEN
I smell margin call desperation. Musk got visibly worried with tanking Tesla stock and pulled out some crazy stops to keep Tesla afloat.
Remember, these megabillionaires are due to stock valuations, and live rich lifestyles on the basis of lending against the value of stock. If that value drops and a margin call forces actual selling, then Musk loses shares in Tesla.
I have to think this stunt is related to Musk needing some liquidity somehow, or being unable to cover private liquidity crunch with public assets.
TSLA is ludicrously overvalued. P/E is 150, based on Q4 earnings which were 1/3 "real" revenue, 1/3 mark-to-market-BTC (aka one shot), 1/3 CAFE/subsidies which Trump will nuke in 6 months.
But the "real" earnings that were already flat in Q4 are seeing a huge drop in EU/CN and who knows in the US. If "real" revenue drops 20%, the "real" earnings might drop 70% or more.
Anyway, that 150 p/e is ACTUALLY 450 in my mind, but after Q1 reports it will ACTUALLY be almost 1000 or worse.
The only thing keeping the stock afloat is AI hype, but 1000 p/e ratios are for people with market dominance and fundamental leads on competitors. Tesla is arguably middle of the road in both self driving and robots.
Tesla is still worth more than it was 6 months ago. I don't think a margin call based on borrowing a few years ago is likely.
People tend to only look at the drop from January until now, but if you look back a little further it seems clear that the market was expecting some payout from Musks relationship to Trump. When that's didn't really amounted to anything, the stock price just dropped down to it's September 2024 level and continued from there, as if October - January didn't happen.
What surprises me is that the drop in sales numbers seems to have zero effect on the stock price, at least not yet.
The earnings call for Q1 2025 hasn't happened yet. Those usually happen at the end of the first month of the subsequent quarter.
When is the first earnings call after everyone realized Musk was a Nazi?
Q1 sales call.
I was trying to stay apolitical but a CEO doing Nazi salute and not being fired is uncharted waters, at least in the last 80-85 years.
I keep going back to the horsemeat episodes on mad men, and the papa johns CEO getting booted. This is simply unprecedented in brand management. Brands take decades to build, and are especially important for car companies.
I was thinking margin calls too: https://news.ycombinator.com/item?id=43423201#43425801
He had a sizable chunk of collateralized borrowings against his Tesla shares even before the Twitter acquisition. There was the risk of a margin call during year following the acquisition, but AI became the latest hotness so he was able to spin up a company to cook up some more market bubble.
If it’s an all stock acquisition did it generate any liquidity?
Sort of: it put Twitter's LBO debt on X.ai's books. I strongly suspect Elon had been lending X money to cover interest payments. Both X.ai and X are privately held, so specifics will be hard to come by.
This doesn’t strike me as an objective assessment of the state of affairs.
You could make the same “bleeding money” comment about many historical social media acquisitions – at least Twitter has advertising and subscription revenue. And it’s similarly suspect to argue that xAI is failing due to lack of revenue, without mentioning the astronomical valuations of its peers in the AI space, many of which are not only lacking revenue but also have no distribution channel comparable to the scale of Twitter/X.
xAI has one of the leading models in terms of investment and user base, and it’s rapidly improving on its evaluation metrics.
Twitter/X is one of the Top 10, if not Top 5, social media properties worldwide. It has hundreds of millions of monthly active users and maintains the lead in public consciousness as the “go to” place for 1-N broadcasting of information. While Bluesky shows promise, it won’t be dethroning Twitter any time soon. When has Bluesky been the source of breaking news?
And you cannot separate these two businesses. Twitter/X and X.ai are fundamentally coupled to one another. Twitter is not only a data source for X.ai but also a distribution and retention channel. There is an “ask Grok” button under every Tweet. And it’s not the only LLM that can be summoned via Tweet – with similar automations from companies like Perplexity proving there is value in the channel – but it is the only LLM with a native integration into the interface and first dibs on freshly-generated user content and breaking news.
You're missing the fact that Twitter has essentially 0 advertising revenue compared to the other major social networks, as all major ad networks have stopped doing business with Twitter (this in turn being because of the very high likelihood that their ads would be shown next to content that their clients didn't want to be associated with, such as images of Hitler).
I’m guessing Tesla is paying xAI to train their FSD model?
That would be a shocking conflict of interest - a public company paying a private company, which is owned by the CEO of the public one ?
All while the same CEO claims that the public company is the leader in the field ?
Even by Tesla & Musk lawlessness standard that would be too wild.
We already have multiple news stories about xAI receiving 10,000s of GPUs that were originally meant for Tesla. That's about as close to "public company giving private company owned by CEO money" as you could possibly get without cartoon sacks of cash.
> Even by Tesla & Musk lawlessness standard that would be too wild.
Not to be overly snarky here, but, uh: what standard? They have proven over and over that they could not give less of a shit about either societal norms or the laws of the nation.
Now that you say that, Tesla is already paying the Boring Company, to build a highly advertised ... short tunnel for Tesla Giga factory.
Which they spend 3 years or so building and which seem completely useless. The only big unknown would be how much Tesla did Boring Company for that.
So yeah...
The entire stack is based on TSLA valuation, which is going to tank.
IMO this is going to be meteoric in nature. As in the meteor hits the ground.
If the world wasn't perceptibly irrational, I'd short.
Stock market graveyards are full of people that shorted TSLA. I remember reading about people who lost it all because of a TSLA short at least since 2020. The lesson here is that markets can remain irrational longer than we can remain solvent.
I remember all the other major shorts.
In those cases, it usually revolved around Tesla releasing either the Model 3 or Y, and they were betting against Musk's execution in general. What wasn't really up for debate (in my mind) was the technological lead or the demand in the marketplace for the car.
Essentially, Tesla was primed in both situations for a huge market they had to themselves: electrified transport.
Now?
- demand is tanking, and the brand is permanently damaged, well, as long as Musk is at the helm.
- competitors are everywhere
- technological moat (with respect to EV drivetrain/construction) is gone. I could argue their cylindrical cells are legacy/semi-obsolete in fact, since IMO pouch cells are superior for LFP/sodium ion, and who knows what solid state will optimally package.
Anyway, things are VERY different in my opinion.
There is also the "first buddy" benefit. The whole thing is being actively rebuilt at a time when Musk has been heading a department which, amongst other things, openly backdoored the treasury. It's pretty uncharted waters.
> The entire stack is based on TSLA valuation, which is going to tank.
But it's not is it. Try looking at the trends long term, not just YTD. It's remarkably stable, trending upwards. Yes it gain a bunch of value from October to January/February, which is has lost. Investors seems to have traded on the "First Buddy" effect, that didn't actually do anything for Tesla, so that value has now been removed and we're back on the original trend line.
How the hell drop in sales and lose of brand value hasn't caused to stock to absolutely tank is beyond me. Is someone artificially keeping the price stable? Do investors see something I don't, or they do just not care?
Yep, I also believe that we will have a Minsky Moment on the entire Muskonomy.
Given his political involvement, I would assume that the maximum end date for this house of cards is the date when Trump is no longer in power - which is less than 4 years away. The real date is probably much sooner, but who knows when ?
For anyone else who wasn't familiar with a Minsky Moment
https://www.investopedia.com/terms/m/minskymoment.asp
A few hundred billion will buy you a lot of politicians in this climate.
But that then means that Musk has a strong incentive to keep Trump (or some replacement that will similarly let him do whatever he wants) in power past these 4 years.
Buying time to get the rocket finished that he will ride escaping his creditors to Mars. That would be a badly written plot even by the standard of cheesy comic books, but somehow it all makes sense from that angle. (no, I don't believe that he would ever get within explosion range of a rocket engine ignition)
People do not last in Trump's orbit. I'm shocked Musk has lasted as long as he has. I though he'd practically be a Scaramucci.
Every six months is a 50% chance of ejection.
That's what Tesla shareholders get for not giving Musk the $50B that he so much "deserved" to be fully "invested" in the company.
Don't worry, the Tesla board is totally on top of things.
No, Tesla has their own seperate training supercomputer called Dojo that it optimized for computer vision. Its one of the top 20 supercomputers in the world by compute.
That’s all marketing. They have had lots of issues getting it put together and working, and is more akin to really really really self driving in 2018 we were told.
BTW: find it: https://top500.org/lists/top500/list/2024/11/
Yes - it's really really close to FSD as you say ! Here is also a nice chart they published 2 years ago:
https://electrek.co/2023/06/21/tesla-dojo-supercomputer-is-f...
Definitely on the FSD timeline right now - they are maybe at 1% of what they announced they would be today. But hey, it's Optimus now !
> diminishing user base
Where are you getting this from? All numbers I see indicate the user base has been growing globally. https://backlinko.com/twitter-users
Mmh, that source is showing a 10% drop in users for September 2023 the last point, which was notably before alternatives like bluesky and others were starting off. Also note that since Musk took the company private we don't really know how accurate these numbers are.
So I'd argue that the statement theat Twitter/X is bleeding users can't be conclusively decided, but it seems your statement that Twitter has been growing globally is incorrect at least for the last reported quarter.
And how many of those are real people and not ever increasing numbers of bots?
Elon saying what the numbers are is the most unreliable thing.
Elon made a post about user growth being stagnant.
Wait, wasn't there a "sweetener" for recent X debt buyers that they'd get XAI stock?
The levels of .. self-fertilizing transactions here boggles the mind. I guess that's the idea.
> and xAI doesn't have much of any revenue or assets.
xAI does have some pretty massive datacenters with 200K+ GPUs.
Fair enough, edited to just revenue. But those are just datacenters bought with VC money - my intent was to say that xAI's resources are basically just the investment they've received.
You can’t just pull out the corporate Amex and buy a world class datacenter. There is considerable value add there.
We don't know that it's a world class data center, we only know how many GPUs they bought. For all we know, half of them could be staying on shelvez, and the whole data center could run for 5 hours a day: there's no public info on how well they're doing.
Bro why are you so negative on every comment haha you really leak your negativity on musk companies.
It is a fact that grok3 is a strong competitive model. Surely it had to be trained somewhere? They went from 0 to what they have now in 1 year
Doesn't mean the company is worth $40 billion though... Or even a quarter of that.
They used Tesla’s Amex for that one.
xAI is a private company. I very much doubt that the current VC investors will ever litigate this. They are all waiting for some other favour for taking this on either explicitly or implicitly. Also, I would like to see a Venn diagram of the investors in xAI and SpaceX.
They're gonna go public and the market cap will be at ~$300B within a year or two
Tesla bought Solar City for $2.6 billion, and now it looks like the Tesla Energy division had about that much in net income last year alone.
Solar City was a debacle, it died immediately. Tesla's story in court was they were about to go bankrupt, and it was a financial necessity to redeploy all Solar City assets, including all employees, to Model 3 production.
It breaks my heart because my rust belt hometown got a substantial investment from the state they had been chasing for a couple decades.
$700M of the Buffalo Billion went to a Solar City facility, Elon even said they were going to build the solar roofs there!
New York State didn't dare pick a fight with him as the factory set empty for years.
Full story via Bethany McLean, 2019:
https://www.vanityfair.com/news/2019/08/how-elon-musk-gamble...
Huh, DOGE ought to look into where that 700M went..
None of that is solar roofs. That product never worked. It's nearly all batteries. The Solar City was worthless and it hasn't improved.
How do you know which assets and people were useful on which projects?
How does grand parent know solar city is responsible for the net income?
That wasn’t the claim. They just speculated that acquiring one solar company helped in their other solar ventures, which seems like a good default assumption.
If you have evidence that’s not the case, that would be interesting to share.
I wrote a comment 2 hours before the initial comment in this subthread that explains Tesla held in court that Solar City ended up contributing nothing because it needed to be liquidated immediately lest Tesla go bankrupt. https://www.vanityfair.com/news/2019/08/how-elon-musk-gamble...
For what it's worth, I don't even know what the inverse position would be, SolarCity was a solar panel maker, and famously, the idea after they realized they couldn't come close to China's prices, was solar roof tiles. They would be a major breakthrough project that would make Solar City a breakout financial hit.
Do people think Tesla makes solar panels? Solar roofs?
I don't blame them, I guess, this carnival has been going on for years.
I'm somewhat surprised how dedicated you are to avoiding information and asking for someone, anyone, to give info. It's been 18 hours and 3 replies on your end, albeit without people taking the time to spell it out to you like this. Personally, I would have looked into it a bit myself.
Im not interested in replies from someone who has alerts turned on for this topics.
> It's been 18 hours and 3 replies on your end
You appear nowhere in comments I replied to. Is this your alt account?
And how much of that is solar instead of Powerwall and Megapack? They don’t break it out in filings unless I missed it.
Exactly. So then why draw conclusions about how SolarCity was a bad deal for shareholders (see parent comments)?
There's no substantiation of that either way.
>There's no substantiation of that either way.
I don't think that's the true at all. There's a vast and visible footprint we can see with batteries (pretty sure every major solar company in the U.S. that has a battery storage option does at least some Tesla) that has no equivalent with solar rooftops. The former are ubiquitous while the latter are so far as I can tell almost entirely non existent.
And if that's too light on data I'll put it this way, I'm reasonably confident I can find 10 solar companies that install Tesla batteries for every one that does Solar City roofs.
We know the batteries are a lot of revenue. The substantiation is not zero.
Exactly, and theres plenty of third party companies buying and installing these for customers and their economic activity testifies to the significant scale of the Tesla battery business.
Because Tesla abandoned the SolarCity model? Like, SolarCity was a bunch of sales people going door-to-door to sell questionable leases on solar systems and hawking off the junk bonds resulting.
> questionable leases
I have a SolarCity install that came with the house.
The Power Purchase Agreement lease seemed shady at first, but ultimately I believe it's working out better for my family than for Tesla.
I'm paying just under 11 cents per kWh and it can only go up a maximum of 3% per year for the next ~15 years.
I’m curious what the cumulative operating cost / financial repayment plan is relative to the capital installation cost. Funny enough if it is advantageous to you vs solar city that is one more argument in favor of them running a poor business model.
The general model has some intrinsic advantages. If you want to build out solar generation you normally have to buy land (expensive), but this way the customer is giving you space on their roof "for free". Then the price per kWh the customer pays to the power company includes a transmission cost, but the power is being consumed on site so you don't have to pay that.
The result is that solar generally has a generation cost of ~$0.04/kWh (which includes the cost of the land) but meanwhile you have customers happy to be paying $0.11/kWh. The trade off is the one-time cost of installing it on individual roofs is more labor intensive than doing a large-scale installation in a field somewhere, but that just means it's competitive rather than having a massive advantage.
> Exactly. So then why draw conclusions about how SolarCity was a bad deal for shareholders (see parent comments)?
You can absolutely draw adverse inferences from Tesla's refusal to report certain straightforward, useful numbers. For example, their refusal to publish any real safety statistics, to the point where Elon Musk himself has to invoke rubbish numbers like the 'community tracker'.
If, after all the lawsuits and accusations of failure, and the reporting about the near-zero deliveries and idled factories, the Tesla Energy division is giving you no numbers on the solar roof, and is lumping them together with a totally different product like batteries, there is one thing and only one thing that that means: the numbers are awful.
The burden of proof is on the publicly traded company. That they don't make this information clear and obvious speaks volumes.
How many solar city customers have added powerwall/megapack...?
Even if its low for solar, it doesn't mean it was a bad deal. He acquired existing customers he could sell other products to.
Putting aside the fact that you can't justify fraud by post-hoc outcomes (Shkreli and SBF also claimed that they didn't commit fraud because they would or did win it back), I doubt any of the Tesla Energy division income (even assuming the accounting is okay) is a result of businesses that can be traced back to Solar City.
I suspect most of the business is battery storage and the Powerwall was introduced by Tesla before the acquisition.
The vertically integrated Tesla strategy is to use batteries to arbitrage the value of stored energy. This is well described in the Tesla "Master Plan" documents. Solar is a huge part of this.
According to the company filings the solar assets Tesla acquired are still generating revenue at the rates projected during the acquisition.
Well I trust Elon's statements (even the financial statements) as far as I can throw them but can you point out where it says that? I'm searching the 10-K and I don't see solar broken out.
But even if it's true I assume they are including their utility-scale solar and battery packs, which has nothing to do with Solar City: the panels are generic, the customer lists are not residential, they don't use the fancy shingles. Solar City did not help them in any way with these getting or fulfilling these contracts.
Tesla Energy existed before Tesla acquired Solar City
So what, Tesla energy is a separate division? Tesla solar products are basically dying in the solar roof failed. It's a great idea, who wouldn't want to buy it if it lasted and was practical.
I thought self dealing was usually illegal. I can’t sell my family member my house for $1 for example. But you can do the same thing with companies?
You can sell your house to a family member for $1. (There might be tax implications if you sell a $100,000 property for $1 to avoid gift tax limits or whatever, but that’s a separate issue.) I sold my car to my sister in law for $1.
Self dealing is also permissible with companies. Corporate officers and directors must still meet their fiduciary duties to shareholders. And the potential for conflict of interest changes how courts will evaluate the transaction if a shareholder complains about a breach of fiduciary duties. Ordinarily, in Delaware, operate transactions are protected by the “business judgment rule” that gives wide latitude to corporate officers and directors. https://plusblog.org/2023/11/28/the-business-judgement-rule-.... But if there is self dealing, courts will scrutinize the actual fairness of the transaction. But self dealing isn’t per se impermissible.
This is why many states base the sales tax of used cars sales on the market value, not the actual sales price.
Sales tax was already paid when it was new, the state got its due. That kind of idiotic policy is how expensive and collector cars get owned under an LLC and the LLC changes hands rather than the title. Thus the rich bypass all that BS it's only for the gullible plebs.
Sounds like tax evasion.
You mean avoidance.
> I can’t sell my family member my house for $1 for example
In most countries you absolutely can. The difference between market value and the sale price might be considered and taxed as a gift, but such a deal is generally not prohibited.
If I overpay for a house, shouldn’t it be taxed as a gift too? :p
Depends on the circumstances, but quite possibly?
Yes, self-dealing is illegal when taken to mean a precise legal term; a fiduciary using that position to carry out a transaction in their own self-interest and against the interests of their beneficiaries.
Yes, and just like anti-trust law doesn’t make monopolies illegal, it’s not the self-dealing that’s illegal, it’s the abuse of the process (as you say).
Obviously you can sell house for $1 to a family member, this will not help to avoid taxes though, as tax office for taxing purposes evaluates value of the house independently.
I know for certain that in Virginia you can sell a house for any price you want, because I transferred one to a family member for zero. Of course the county's assessor had other ideas about the value for tax purposes, but the official deed was recorded at $0.
My guess is that there's an added grift, er...benefit here; since the federal government is now (apparently) in the business of subsidizing AI companies, we'll effectively see the failing social media platform get subsidized by the federal government.
I'm certain we'll see a pile of public funds handed over the xAI in the future.
DOGE for thee but not for me!
I mean, that was always a grift to anyone with two brain cells to rub together .
The government spends 1 out every 5 dollars of GDP. It probably does need a better mechanism for managing costs and outlays. Having one of the "richest men in the world" be in charge of it is ridiculous.
That's Trump for you. Populism up front, oligarchy in the back.
Not sure that tracks.
Oligarchy is generally how people who don't deserve wealth can get it. As pointed out by you, that doesn't exactly apply to the world's (already) richest man.
And who exactly would you look for to help the federal government build "a better mechanism for managing costs and outlays", if not someone who has built multiple successful businesses (managing costs and outlays at impressive scale) in very different industries?
> Oligarchy is generally how people who don't deserve wealth can get it.
No that's just one of it's outcomes. The proper definition would be "a small group of people having control of a country, organization, or institution."
> that doesn't exactly apply to the world's (already) richest man.
Given the appropriate definition and his involvement in owning not only a social media company but also having a role in federal government policy and now apparently investigations I am completely baffled by your assertion.
> And who exactly would you look for to help the federal government build
I figured someone would summon this fallacy. He has acquired wealth. This does not demonstrate any skill in spending tax payer money efficiently in a regulated environment. This is particularly true if you're willing to assume that oligarchy played some part in his acquisition in the first place.
> if not someone who has built multiple successful businesses
He likes to call himself a founder. Of business that already existed and he purchases a controlling share in. It's amazing that people accept this distortion of reality.
> managing costs and outlays at impressive scale
Presumably he has people on the payroll who do this. I imagine that the entire financial success of these companies is not down to a single person. How does he find time to do anything in a day?
I imagine the federal government could, you know, just do the same thing. Hire qualified professionals to do the job?
> Not sure that tracks.
Outside of the reality distortion field that some people willingly occupy it most certainly does.
Really is crazy to seriously say Elon is really good for the job
> It's amazing that people accept this distortion of reality.
Indeed
Yes, I stated it as an outcome. I was not defining oligarchy. I was responding to a comment which was stating that Elon Musk becoming involved in the USG apparently makes it an oligarchy, and that this has something to do with this personal pre-existing wealth.
The govt isn’t a business. Do you really want the list of people who would be better than Elon fucking Musk? It would take forever. This has the same energy as believing what Doge says because they have a simple table saying so
Could you give a broad outline of how you'd make this list? The government is currently not run efficiently, so clearly we can't rely on people who already have lots of government experience, because that just means they've been doing a poor job for a long time?
The assertion that Musk built Tesla, SpaceX, and SolarCity is peak absurdity.
What a bizarre thing to say.
Just as bizarre of a thing to say that he built X, I suppose.
That isn’t what oligarchy means. It has never meant that
I don't remember defining oligarchy in my comment.
Peter Urchin says it is a plutocracy particular with the patch called Citizens United
Isn't X more profitable than Twitter was?
Yeah it is more profitable but revenues are way down.
In 2021, the last full year before Musk's acquisition, Twitter generated $5.08 billion in revenue.
Under Musk's ownership, X's revenue has declined significantly. In 2024, X reported $2.7 billion in revenue, which is nearly half of its pre-acquisition level. For 2025, global ad revenue is projected to grow to $2.26 billion, marking its first annual increase since the acquisition.
So yes on paper, X is more profitable than Twitter was before the acquisition. Its 2024 adjusted EBITDA nearly doubled Twitter’s best year, despite a much smaller revenue base. But whether that profitability is sustainable or comes at too high a cost—strategically, reputationally, and culturally—remains an open question.
You didn't actually show profitability here. I think if it were actually profitable, Musk would've hyped it up.
Lol, who did the adjusting!? ... Good old "adjusted EBITDA".
Isn’t this what Trump was found guilty of? Inflating asset value at loan time and deflating their values at tax time?
Beyond the valuation, I think there's 3 things that are interesting to think about:
1. Musk owned an estimated 80% of X and an estimated 50% of xAI [1]. We don't know the specifics of the deal, but we do know it's an all-stock deal, so in theory this should help Musk own more of xAI, which sounds like better-performing and more promising company atm.
2. Tesla has been a big name in AI for a while now, but has been awfully MIA when it comes to generative AI. It's always focused most on vision, sure, but it's not hard to see how other types of AI could fit it's strategy.
Imagine a conversational virtual assistant in your car, or in their robots, or the possible manufacturing applications. In my opinion the device manufacturer + AI lab combo, especially for a device that sells on its promise of cutting-edge technology, makes more sense social network/LLM combo. Beyond the product applications Tesla would greatly benefit from the prestige and marketing of cutting-edge AI.
Nonetheless Musk owns only about 12% of Tesla [2]. It makes more sense for Musk's fortune to ride the wave of this new industry with a private venture he owns. This 12% ownership is down from 22% in 2018 btw [3], before the Twitter acquisition in 2022, which was largely funded by liquidating his Tesla stock [4]. Musk seems to be very much divesting from Tesla— both in effort and in money.
3. Where does this leave Musk, Tesla, and xAI?
- I think it leaves xAI in the position of being the most important company for Musk right now. Best-case, it becomes a "big tech" company. I'm sure we'll keep hearing much more about it, although I don't rule that Musk could try to sell it or merge it if it gives him control of a tech company with a solid business model or strategic importance.
- Musk I think is definitely in a better position than before, fortune and power-wise. He's been diversifying away from a company that's had an insane PE ratio for a while [5], but most importantly, he's been doing so in a pretty smart way. If he had just sold Tesla to buy government bonds, the share price would've crashed. Instead everyone buys into the "he's eccentric and went through a divorce" story. Social network ownership has given him plenty of political power— I don't doubt unbanning Donald Trump is how he got close to him the first place. And now he's converted imaginary wealth from unattainable hype at Tesla into ownership of private company riding the hot tech wave of the moment, concrete political power and self-regulation via his seat in government, and evergreen influence/relevance via his own social network— a tech baron's dream.
- Tesla is not doing great, and Tesla investors are the ones getting the short end of all this. I think Musk realized self-driving is too hard, be it due to tech or regulation. I think he realized he can't compete vs Chinese automakers. I think he's pumping and dumping. If he can get a good deal he might try to merge it with xAI in a way that offers him full control of the company (maybe even private ownership), but otherwise I think Musk is ready to let go of it. He's used its insane valuation to get himself better assets.
[1] https://www.barrons.com/articles/xai-buys-x-musk-twitter-2e5...
[2] https://www.investopedia.com/articles/insights/052616/top-4-...
[3] https://www.thestreet.com/investing/stocks/how-elon-musk-con...
[4] https://abc7.com/post/elon-musk-accused-improperly-selling-7...
[5] https://www.macrotrends.net/stocks/charts/TSLA/tesla/pe-rati...
In similar news: my left hand acquired my right hand today in an all stock deal valuing the combined hands at $1T. Praising the announcement my arms noted on the deal: “With these two hands now together, there’s nothing our combined fist of might can’t do.” Competitors, my left and right feet, declined to comment on the merger but are said to be in their own separate talks about a deal.
Was this announced at an all hands?
This sounds like yet another arms dealer.
I haven’t laughed this hard in a long time. This should be the top post.
What are you gonna do with two hands?
Accelerate our work towards achieving AGH
Twice as much!
There's only one correct Silicon Valley S01 answer to this: jack off two dudes at the same time.
(Or more, if you're a middle-out sort)
right but you don't have $1T to do that, whereas clearly he has however much money he's paid for it. it's a weird thing to do, but if he has the money to do it then meh?
In similar news: my left hand acquired my right hand today in an all stock deal valuing the combined hands at $250,000. Praising the announcement my arms noted on the deal: “With these two hands now together, there’s nothing our combined fist of might can’t do.” Competitors, my left and right feet, declined to comment on the merger but are said to be in their own separate talks about a deal.
changes nothing
Yeah it does, presumably he has that much money, which invalidates your original point. Hope that helps explain the situation!
it doesn't invalidate anything; my original point was that Musk has this much money, meaning that he's just moving money around, meaning that this pretentious analogy is not actually making any kind of insightful point whatsoever. what Musk is doing is taking two entities already with a high market value and then merging them, he's not just deciding randomly that 2 irrelevant things have value. how much money this guy has is irrelevant. it's just a shitty attempt at satire, which I cannot stand
He's not moving any money around.
The acquisition is entirely in stock. Shareholders of X are receiving xAI stock in exchange for their X shares. They don't get any cash.
Musk says the new combined entity is worth $80B, but that's on paper. The company certainly doesn't have that much cash or liquid assets. The valuation is based on xAI's previous funding round + whatever number they decided to assign to the X assets + the magic of "synergy" produced by this deal. In other words, it's not based on anything real. (Accountants call this "goodwill.")
right but those entities quite clearly have an existing market value in the region of those numbers. this guy's arms and legs do not. it's a poor analogy that's trying to be too clever
Maybe the guy is pretty good at basketball and sincerely thinks he’s going to be the best player in the world next year? That would make his arms and legs awfully valuable.
Musk’s xAI is in a similar place. It’s an also-ran in a crowded space and it’s not making any money while spending billions. But the founder certainly has great faith in it. Is $80B the right value to assign to that faith? Who knows.
> quite clearly
X is "clearly" worth only $10 billion less than what Musk paid for Twitter back 2022? Really? Despite its revenue being 50% lower than it was back then?
As for xAI, Anthropic has a valuation of ~$60 billion. So again not that "clear". Of course they don't have Musk's political connections which might end up mattering quite a bit (of course there's also the risk of Musk being prosecuted in 4 years as well...)
?
>quite clearly ... in the region of
like +-50% or more? That's a very wide region.
first of all, Anthropic is hardly more successful than xAI. they get a lot of headlines, but how many people actually use Claude? and what else do they have going for them? as far as I've seen and heard Grok is just as successful if not more.
second of all, I would suggest that twitter's value as a whole is very nebulously related to its actual revenue numbers, and is far more related to: - its potential revenue numbers, which are way higher in the hands of someone less controversial and - profit, which we don't really know about because its private anyway, but is likely much higher given the amount of cuts that have been made.
> s I've seen and heard Grok is just as successful if not more.
Most of what I've seen about Grok were the various memes about people trying to trick it into saying stuff about Musk (or trying to expose the filters stopping it from saying bad things about him).
> its potential revenue numbers
Maybe. But it wasn't even that successful financial even in the pre Musk days compared to its competitors. Destroying the brand and reputation also had a non-insignficant impact.
> but is likely much higher
Twitter was barely or not at all profitable before the acquisition so that's not unlikely. Companies that have high net income but stagnant or decreasing revenue generally don't do that well in the stock market, though.
They are both private companies. Neither has a true market value because they are not on a market.
that's not how market values work and there's no such thing as a "true market value". my car has a market value, it not being for sale right now does not change that.
Your car is presumably not unique. Both the model and well... it probably does more or less exactly the same as any other car. If you had an entirely unique one of a kind antique car it would be pretty different.
Estimating "true market value" of companies whose valuation is almost entirely based on their potential long-term growth isn't particularly straightforward until you find a buyer willing to buy a significant or it does an IPO.
>Your car is presumably not unique. Both the model and well... it probably does more or less exactly the same as any other car. If you had an entirely unique one of a kind antique car it would be pretty different.
I fail to see how this is in any way whatsoever relevant. a unique car has a market value, and a non-unique car also has a market value. anything that can be sold has a market value. there's still no such thing as a "true market value"
> anything that can be sold has a market value
Well not until you try to sell it and find a buyer.
I mean sure xAI does technically have a market value we just don't know what it is because there is no market that would allow us to determine it.
Of course the price paid by private investors do provide some estimate but a company .e.g. raising $5 billion at a valuation of $150 billions or something like doesn't necessarily have a market value which is that high.
>Well not until you try to sell it and find a buyer.
just because you don't know the market value of something doesn't mean it doesn't have one
Your car has value IN a market. Different markets have different prices and different conditions etc.
so? it still has a market value whether or not it's currently on sale or has just been sold
Except there is no money involved. xAI has nowhere near that amount of money in cash or in any liquid assets. The valuation hardly means anything, it might be worth $10 billion, it might be worth $100 billion nobody can tell at this point.
xAI doesn't have the money to buy X either. This acquisition doesn't involve any cash whatsoever.
"I merged my checking account ($X) with my savings account ($Y) in an all cash deal valuing the combined entity at $X+Y"
Presumably that involved actual money unlike this deal?
precisely
So he just sold himself a company he already owns for a valuation that he himself assigned to that company but that was less than what he paid for it, and he paid entirely using “money” that has a made up value and which he issues himself?
Wild.
This also lets all of his co-investors in X, who were likely pissed that their shares tanked, exchange their shares at an inflated value (but one that still sees them losing 25% of their original investment) for shares in a trendy yet likely overvalued AI company that they consider to have more upside.
The other part of this is that if TSLA stock drops to $100-ish he'll be at risk of being margin called on the loans he took against his holdings to buy X. I wouldn't be surprised if this deal involves some X shares being sold for cash (that was raised from VCs) to pay down those loans, and/or the lenders agreeing to take xAI stock in lieu of cash.
This whole thing seems like a big pyramid scheme. I don't think this is the last time we've seen this type of move: he'll keep starting companies that are at the forefront of whatever the current hype cycle is, then leverage the extremely inflated valuations to benefit himself.
> This whole thing seems like a big pyramid scheme.
That's because his scam of charging $8k over the price of a Tesla for "self driving" was complete vaporware. It never worked and it never was going to work. I am disappointed I fell for it.
There should be a class action lawsuit against TESLA for everyone that purchased the $8k self driving "feature". We were all told it was "being rolled out". It was a total lie.
You must not have tried FSD 13.x with AI4 hardware. I commute to work every day from the suburbs to the city with a ~25 min one-way commute with zero disengagements.
Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
Edit 2: To clarify, FSD 13.x is only available with AI4 hardware.
They started selling FSD back in like 2017 and it was supposed to be self-driving ALL THE TIME by 2019. It’s 8 years later now and the best you’ve got is “upgrade the hardware to version 4 and you can make a 25 mile commute without disengagement” when Tesla was promising cross-continent summoning so you could fly somewhere and your car would drive there to meet you, charging along the way. That’s L5 autonomy. The delta between promised and delivered is so far apart it’s ridiculous. Mercedes’ autonomous system is the only L3 even, Tesla’s is L2. They by my definition did not deliver whatsoever on their promises.
Another thing is a lot of people don’t even keep cars longer than 8 years (and people who are buying new, $100k electric cars are more likely going to upgrade sooner than someone who’s buying a $30k civic.) they paid for FSD thinking it would be ready soon.
I was intent on keeping my low-vin release day Model 3 until they made good on their FSD promise, come hell or high water. Then The Salute and The Infomercial happened, and I gave up and ditched the car like a psycho girlfriend. They got my money and I was fooled by a con. I'll never let that happen again.
You sold it though or did you literally ditch it?
Sold it to Carvana. Picked up a newer used Audi for the same price.
You ask for a friend, to „just look at it“?
I was replying to the "never was going to work" part
> It never worked and it never was going to work.
That is evidently false. If I had a longer commute it would work fine too. I have done ~2 hour road trips with it already.
You are bringing up a different point, which is that FSD arrived later than promised or at least implied (I don't know exactly how this was sold in 2017). That is self-evident at this point.
It hasn't arrived at all.
> Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
Unfortunately, that's because they were sued in court and lost when they tried to force people to buy the upgraded hardware in the past. Not because they stand behind their products.
I would not be comfortable using any self-driving system on US roads that only utilizes computer vision.
The reality is we don't actually know how reliable these systems are, and Tesla has a long history of spreading misinformation about their own technology and obfuscating the facts. We don't even know how many cars crash while in FSD mode. We don't know how they crash, or why. None of this data is made publicly available, and of the data that is shared it is carefully curated, and we have no guarantee the data is not fudged. For example, are we certain that FSD does not disengage itself in dangerous circumstances to skew statistics in it's favor?
Trusting Tesla marketing on the topic of Tesla products is like trusting any kind of marketing. They have an incentive to sell the car, so they will lie, and they will cheat.
I am equally uncomfortable that other people are out there beta testing FSD.
> I am equally uncomfortable that other people are out there beta testing FSD.
That is probably because you are unaware how far it has gotten. Irrespective of that, a driver still needs to be there and pay attention. As soon as you take your eyes of the road for a few seconds it will warn you very prominently.
I'm going on the record here to say that FSD will be a better driver than 99% of humans in the next 2 years. I may be wrong, but I don't think I will be.
In this economy?
>Edit: Elon mentioned in the last earnings call that if you are on AI3 hardware and bought FSD that they will have to upgrade you free of charge to AI4.
AFAIK a retrofit from AI3 to AI4 isn't possible.
The outside investors in X made a profit on paper; Twitter was bought for $44B but the deal was financed with like $31B in equity and $13B in debt. It’s not a big profit (in fact it’s worse than you would have done in T-bills), and of course they’re swapping one illiquid and hard-to-value asset for another, but Elon isn’t giving them a 25% haircut at all.
Even if he made the Twitter investors whole, I wonder how the investors in xAI feel.
They feel great, because he just magically turned a ~50% loss in Twitter into a ~50% return in xAI and a ~0% loss in Twitter.
Of course, you can't buy $20B worth of mangoes for $40B worth of Mango Holding Company stock and then suddenly make your mango-holding business worth twice as much money.
But you can pretend!
Private valuations, especially VC-funded companies, have been nonsense for decades. Elon is just exploiting that egregiously.
They're mostly the same investors.
They just wait for the next round of this. Maybe SpaceX will require more AI? Or Tesla?
Isn't Twitter's stock price higher than it was at acquisition?
As the sibling pointed out, private companies don't have stock prices. But I've read estimates that Twitter is worth less $10B now, so less than a quarter what Musk paid for it.
The banks just recently did a debt sale of a lot of that debt close to list price, so 44 billion dollar valuation is probably reasonable. Apparently the company is profitable now, sans the debt, so as long as it doesn't go out of business and can grow on other fronts then it's probably not a problem.
Can you list this sale you claim valued X at 44B?
Fidelty, which still owns a decent chunk of X, and is required by law to do due diligence on the value of that holding, and also has deeper insight into the value of X since they are also required to see X financials (since they own a big chunk of the private value), puts X value at 20% of the original 44B.
So please demonstrate your claims.
https://www.forbes.com/sites/tylerroush/2024/09/30/elon-musk...
A few weeks ago in February:
https://www.investing.com/news/stock-market-news/musks-x-sec...
> Banks have completed the sale of $5.5 billion in debt for Elon Musk's X, according a Wednesday report by the Wall Street Journal. The debt offering was increased following a strong response from investors. Ultimately, the loans were sold at 97 cents on the dollar.
This is not the same, as no ownership was traded, but it signaled surprising confidence that the debt could be sold with only a small discount.
That does not value X at $44B as the poster claimed. It also states “ These floating-rate debts have an interest rate of around 11%, making the borrowing costs several percentage points higher than even the riskiest loans on Wall Street.” which is a spectacular admission the markets put X on incredibly shaky ground.
X being forced to sell off debt at such extraordinarily bad terms means X is likely about to implode.
I agree that the interest rate is astonishingly high.
> profitable now, sans the debt
So, not profitable.
What، acompany needs to cover the costs of how it was acquired, now? If it's valued at the price it was purchased and making a positive revenue stream then it is profitable.
Yes, this seems to be common practice.
1. Borrow lots of cash
2. Buy a victim company with the cash
3. Carry out weird financial/legal alchemy to make the victim company solely responsible for paying off the loan
4. If the victim company can’t handle the debt and goes bankrupt, then you don’t own the company any more. That’s sad. Especially for the people who lose their jobs. But the people you borrowed the cash from can’t chase you for it, so no harm done, eh?
5. If the victim company pays off all the debt, then congratulations: you bought a successful profitable company for free!
I don’t understand step 3 or why it’s legal.
They need to cover their debts. If someone uses private equity raider tactics to load the company up with debt, it’s likely to be bad for the company but it still counts on their books just as taking payday loans is ill-advised but legal.
This is part of the reason that the term EBITDA exists.
With the debt it's break even.
So, not profitable.
The company is profitable. The debt is unrelated to assets acquired or previous deficits.
So much financial sophistry going on here, can almost see the sequel to the CDS infused trauma of 20 years ago coming down the line
a.k.a the worst kind of financial engineering. The company is not profitable if it doesn't make a profit when all things are considered.
And we're not even talking about the missed opportunity costs of the ~ $27bn cash used to purchase Twitter. Most of that value is completely gone.
If you were an investor in X and put up some of that $27 billion dollars you now own shares in xAI, so it's not not gone.
You can dress it up in "financial alchemy" like any hedge fund, but it doesn't disguise the fact that the last person to carry that can is going to lose a lot of very real money.
That doesn't even make any sense.
This makes no sense. The debt payments are larger than the company's entire revenue! The Twitter purchase was a financial boondoggle that Elon is attempting to hide with this latest deal.
If I borrow $4 million to buy a house worth $1 million I could technically say that sans the debt I'm a millionaire, but that's hardly a useful or positive claim.
Rhis raises it back to the original level (although entirely based off the absurdly overinflated value of Grok at $80 billion. VCs…)
Twitter doesn't have a stock price. It got taken private in the acquisition.
Also I think Fidelity open puts out statements on the value of Twitter since they are a shareholder. The only recent info I can find on this was an article from last October:
https://www.forbes.com/sites/tylerroush/2024/09/30/elon-musk...
Where it states that Twitter is now worth 1/5 of its $44billion price. I highly doubt it re-made up the equivalent value in the span of 6 months. If anything they likely lost more money as advertising sales have plummeted.
Feeling mighty 2008/subprime in here
He's simply moving Twitter losses to xAI investors - because he's the largest Twitter loser - and would prefer those losses go to other patsies instead.
I don't think he's going to be able to spin up hype on anything after this. He's burned a lot of bridges.
When you Godwin your own thread, you are by definition done.
He didn't leverage Tesla stock to buy X.
These Reddit level takes with zero research are making threads like this really annoying to read. All emotions, zero facts.
Speaking of threads with zero facts, can you cite your research? Here’s mine showing $12.5B secured by TSLA shares:
https://www.sec.gov/Archives/edgar/data/0001418091/000110465...
That wasn’t the only funding, of course, but it’s a big chunk:
https://web.archive.org/web/20220422035052/https://www.bloom...
https://www.nytimes.com/2022/04/25/technology/musk-twitter-s...
Again, you're just citing three things from the same date, and I don't believe it's in good faith.
Elsewhere I suggested people to just Google it, because it gives you an honest answer. So does chatGPT. So does the Wiki page on the deal, with sources.
Here is one said source -
https://www.theverge.com/2022/5/25/23141940/elon-musk-tesla-...
Thanks for the source. Google might have given you the later update because you’d already searched for it, but that was not true for me.
How did he get the tens of billions in cash he personally put in if not leveraging Tesla. Yes he had minority investors and put some debt on the acquisition itself, but he put up a lot of money.
He sold Tesla shares.
This is all public, I don't understand the weird speculation...
He also sold a ton of shares. But not enough to cover all the money he needed to put into Twitter.
He had to sell some Tesla shares because he reached the max borrowing limit against his Tesla shares that was allowed. Once he was forced to sell shares he had to pay a lot in taxes. This shows the mega wealthy can pay taxes and not become poor. We should learn from this lesson and tax the .01% of society.
He hit his max borrowing limit? Can we just discuss the facts rather than making stuff up to talk about our favorite narratives?
Yeah, let's continue talking about how no one person in the entire human race should have more than $50 million dollars.
I agree with the other poster.
And who are you to decide that?
In the French revolution it was decided by the ones with Guillotines :)
Lets see how Google ai in search handles it.
AI Overview
Elon Musk is limited to borrowing against pledged Tesla shares, with the total loan amount capped at the lesser of $3.5 billion or 25% of the value of the pledged shares. Musk's current holdings of about 411 million shares and 238.4 million pledged shares as of April 6, 2023.
Here's a breakdown:
25% Loan-to-Value Limit: Tesla's policy caps the loan amount Musk can take out based on a percentage of the value of his pledged Tesla shares.
$3.5 Billion Dollar Cap: Musk's borrowing is also limited to a total of $3.5 billion.
Pledged Shares: Musk currently has 238.4 million shares pledged as collateral for his loans.
Overall:
Musk is borrowing against a portion of his Tesla stock holding, subject to the limits set by the company policy.
For more info:
https://www.bloomberg.com/news/articles/2023-04-06/tesla-alt...
You haven’t added any facts either, it’s just one more statement from a random Interneter like those Reddit posts. I’m intrigued to hear some fact on this point though?
Yeah these fantasies where musk would somehow go bankrupt by tanking Tesla and overpaying for Twitter were also wild
He’s literally the richest person the earth has ever known. He’s never going to suffer financially. He has countless levers of power he can pull.
The same fantasy applies to any past or current president ever spending a day in jail. He literally commands the most powerful military apparatus the world has ever seen. Even a sliver of that capability and influence ensures nobody will ever dare to try and slap some cuffs on him
That military apparatus is sworn to uphold the Constitution, not support the current president.
This only matters if people care enough to act appropriately when that is broken.
I guess we'll see what matters when Trump orders the tanks to roll into Canada.
This wouldn’t happen today. Today there is talk about Canada becoming 51st state; there is relatively little opposition to that - on the contrary, the perception of Canada as a US ally drops in the US[1]. Four more years of this and I could see people similarly accepting tanks. And if you want to prevent this, the time to act is now.
[1]: https://apnews.com/article/trump-poll-allies-enemies-friends...
Surely no one currently in power wants Canadians to vote in U.S. Federal elections? So it has to be a setup like Puerto Rico (U.S. citizenship without representation in Washington) or even American Samoa (no U.S. citizenship). The 51st state thing does not make sense at all.
90% oppose the idea. https://www.cbc.ca/news/canada/u-s-eh-who-are-the-canadians-...
The Constitution isn't worth much right now, and it's up for sale, no less.
I wonder if Elon will acquire it with shares.
I mean, he did pay people directly for voting in the last round of primaries and he's doing it again for that judge election in Wisconsin, and all his money is Tesla shares so.. yes, he's already doing it.
Even though the world is turning upside down, the fact that this is possible without facing immediate arrest is still surprising. I don't think this is possible in any other democracy.
He didn't pay them to vote. He paid them for signing a pledge. He had no way to determine who they voted for.
I really wish for this theory to be tested TBH. Martial law in US would be a great thing. US economy tanks, rest of the world like Europe is forced to pick up the slack, the world gets a refresh on what conservative "small government" brainrot does to countries.
Got some good examples from the past?
WWII?
It won't be like that. You'll slide further towards Putin/Erdogan state management and oligarchy. Hints of it already in how AP and The Atlantic are being treated, and the hints about what a future judicial system might look like.
Let's be realistic: Congress has given away its power for decades. It is nowadays a Congress permanently divided and pretty much non-functional.
Congress has never had the power to command the military, that's not one of the powers granted to it in the constitution.
Congress has the power to declare a war, which was supposed to prevent the Executive from taking any military action that was not purely defensive, without their approval. There was even a requirement about how long the President had to give an accounting to Congress about any action they did take. So yes, Congress was supposed to have the ability to "command" the military insomuch as they could choose whether the Executive could utilize them or not. Saying "no, you're not going to do that" is an authoritative command.
Hamilton, Washington, and Madison all separately wrote that Section 8's War Declaration clause was intended to be a substantial limit on the President's power. Even the small, mini-conflicts in the 1800s required Congressional approval to initiate, it wasn't until the 1950s that the Executive branch destroyed that check on Executive power.
By command I meant that Congress cannot tell the military "go arrest the president" or "go quell the unrest in that state." I agree that Congress has ceded too much power to the Executive in regard to declaration of war/military action in foreign countries after 9/11 though.
Trump may be Commander in Chief, but he cannot start a war without Congress' approval.
Unfortunately, they've essentially given more or less blanket approval for various wars and war-like actions since before 9/11, and that approval keeps getting renewed every year.
He can't start a war, but what about special military operations?
The advent of nuclear weapons arguably negated Congress's power to withhold approval for war. Garry Wills writes about this in his book Bomb Power.
No, this is a rationalization.
The commenter also included past presidents, which is silly. Once a president is a past president, he no longer controls that military apparatus.
The U.S. will never allow any former president to get prosecuted because the precedent is too severe.
By all reasonable accounts, GW Bush should have been prosecuted for war crimes. Trump should have been prosecuted the moment he left office for a spectrum of crimes. There is even a strong argument that Obama should have been prosecuted for drone strikes on citizen combatants.
But power protects power, and the moment that seal is broken all hell breaks loose amongst the ruling class.
How many people were held accountable for the 2008 crash? Zero. That would mean everyone else has to stop their criming too.
Who knows, maybe Trump is stupid and petty enough to take revenge on his enemies. If he does, no doubt his entire administration is the next against the wall as soon as the winds change.
Nixon certainly would've been prosecuted if he hadn't been pardoned.
> There is even a strong argument that Obama should have been prosecuted for drone strikes on citizen combatants.
I don't think this is very strong at all. There is zero evidence that Obama intentionally targeted civilians outside of al-Awlaki. Suggesting that he did, and that he should be prosecuted for war crimes, puts him in the same moral category as those who ordered actual torture on enemy combatants and launched wars on fabricated evidence. It's preposterous.
War crimes are a very broad category, so no, it's not preposterous to claim that different people are both guilty of them even if the scope varies significantly.
Obama pardoned all the torturers and their instigators. He is in the same category.
I strongly disagree with that equivalency. Obama should have pursued accountability instead of pardoning them like he did, but I do not agree that it puts him in the same moral category. Your framing shifts the argument from "Obama maybe deserves some scrutiny here" to "Obama belongs in the same cells with the torturers."
You're collapsing several degrees of responsibility with this lazy equivalence, and minimizing the heinousness of the people who actually designed and executed torture programs.
The world has no shortage of evil bastards. The only thing that restrains them is the knowledge that they may be held to account. Obama undermined that.
"Don't worry, we've got your back. If your country asks you to do evil, we won't hold you to account. So go right ahead."
Who is worse? The criminal or the corrupt judge?
> There is zero evidence that Obama intentionally targeted civilians outside of al-Awlaki.
So... there is evidence he intentionally targeted a civilian?
Sorry, I actually meant to write that al-Awlaki was a citizen, as in an American citizen. Obama didn't intentionally target civilians, and he didn't intentionally target "citizens" as OP stated outside of al-Awlaki who was an American citizen turned insurgent.
But trump was prosecuted. He was found guilty.
It's just that in the meantime the rule of law in the US died and he was elected again.
If there are elections in 2028 and MAGA loses he's toast. Big if.
You'll get him this time! After 9 years of failing.
Dammit, all we need is just one more chance!
The American justice system deserves to cease existing if 4 years isn’t enough to process people for possibly capital crimes (J6 coup attempt). No state can afford that.
Even if MAGA loses in 2028, I have very low confidence that Trump will see any consequences for his crimes. There's also the fun self-pardon-by-proxy trick: on the morning of the last day of his administration, he resigns. Vance is sworn in, pardons Trump for anything he's done, and then passes the presidency on to the next one.
Regardless, Trump is old. Even if he's convicted of something in 2030 or whenever, he probably won't go to prison. He may even be dead by then; he'll be nearly 85, and no matter what his doctors have been told to say publicly, it's hard to believe the man is in super great health.
I think the “big if” in the parent comment was about whether there would be elections in 2028, not whether Trump might lose them…
> By all reasonable accounts, GW Bush should have been prosecuted for war crimes.
According to the rules we put in place at Nuremburg, EVERY US President since World War 2 has committed war crimes.
Trump was prosecuted.
They meant criminally prosecuted, which he was not.
Sure he was. He is a convicted felon, with 34 guilty counts under his belt[0]. You can't get convicted of felonies in a civil case. That was a criminal prosecution.
[0] https://apnews.com/article/trump-trial-deliberations-jury-te...
Trump was criminally prosecuted on both state (New York and Georgia) and federal charges, and convicted on New York state charges, before being re-elected. Because prosecution is an executive power exercised by the President, his re-election made it so that he would be President and thus unprosecutable by the time of trial on the federal charges for which there were still active prosecutions, resulting in them being dismissed without prejudice. (Technically, they could be refiled after he leaves office again.)
Concerns about Constitutional issues with state penalties interfering with federal duties also led the judge in the New York state case, where he was convicted of 34 felony charges, to sentence him to "unconditional discharge" -- essentially, he remains a convict, but faced no penalty beyond the fact of officially being a felony convict.
Issues relating to prosecutorial behavior have stalled Trump's prosecution on state criminal charges in Georgia, but those charges remain active (whether the prosecutor's office that was handling the case can continue to do so is an issue currently subject to appeal, and may not be decided for several months.)
You're right. I'm honestly not sure what I thinking.
… How did you miss the last year or so? I’m jealous.
That's a fantasy military leaders like to tell troops.
Let's hope we won't how that plays out against against the reality of having bills to pay and family members to take care of after enough layers of leadership has been replaced.
When there's no alternative nexus of power to rally around, they'll have no choice but to do whatever illegal thing they are told.
That only works until Trump finishes purging the upper ranks of the military, and then gets the Senate to promote Trump loyalists to take their place.
What is a "loyalist"? What president has not put in place people that are loyal to him?
A loyalist privileges their leader over their principles. A patriot is a leader that subordinates themselves to the principles shared with their followers.
In the context of this conversation, a loyalist is obviously someone who will disregard the law and the constitution if Trump orders them to do so.
Funny.
From what I have been told (specific to the US army):
- Enlisted swear oaths to the constitution and President
- Officers swear an oath to the constitution
I’ve only been told this, I don’t claim to know.
You can just google the oaths that people take.
- enlisted: https://www.army.mil/values/oath.html
> I, _____, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; and that I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God. (Title 10, US Code; Act of 5 May 1960 replacing the wording first adopted in 1789, with amendment effective 5 October 1962).
- officers: https://www.army.mil/values/officers.html
> I ___, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God. (Title 5 U.S. Code 3331, an individual, except the President, elected or appointed to an office of honor or profit in the civil service or uniformed services)
Take a look at the Oath Keepers or the 3%ers and let me know if you think they are going to do the right thing here.
They took an oath to protect their interests. That’s it and that’s all.
I'll grant you that these militias are well-armed and have sketchy loyalties, but if the US military decided they were honor-bound to defend the Constitution, against Trump, they'd crush the Oath Keepers and their ilk.
Many of the members of those militias are themselves military or ex-military. Which already tells you volumes about how likely it is that all of the US military would "decide they were honor-bound to defend the Constitution". Besides, those guys don't think of what they are doing as contradicting the constitution - quite the opposite! They are very obviously wrong, but that has never stopped fanatics from believing in their creed.
The real question, anyway, is not whether the military will obey Trump's illegal orders, should he issue them. It's whether the military would do something to stop the militias if Trump lets them off the leash with an explicit mandate.
And my concern is that most of the lower-ranking officers and people below them will prefer to sit it out. Because if they do something, and it's not enough, they are all looking at actual treason charges and likely death sentences.
Do you really believe that these lower-ranking soldiers are going to sit idly by while they watch their family members get raped and executed (because that's what lawless paramilitaries do) on the nightly news?
Some light reading --> https://www.lawfaremedia.org/article/deploying-soldiers-on-a...
But it won't be their family members, in most cases. It will be some despicable "cultural Marxists" or even more abstract "terrorists". And the rapes? Fake news.
Which does match what GP said. Enlisted swear to defend the constitution and obey the president. No limitation to lawful orders or stated precedence between the too. Commissioned officers don't swear to obey the president
What do you mean "no limitation to lawful orders"? That's what "according to regulations and the Uniform Code of Military Justice" means. Article 92 is pretty explicit about what constitutes a lawful order.
It’s explicit about following orders according to the UCMJ, and the UCMJ clearly defines what constitutes a lawful order that must be followed.
So, it’s transitive, but the enlisted oath is limited to lawful orders.
They swear that they will obey lawful orders from their commanders, all the way up to the President.
Who decides whether order is lawful or not?
A soldier comes to their own assessment then a court martial decides later on if they agree. Just like every other form of action: do what you believe is within bounds, then find out later if the courts agree
> Who decides whether order is lawful or not?
The individual. If your boss orders you to do something illegal, it’s up to you to be sceptical and do your research. That’s the only way it can work without converting a part of the population to drones.
If the order is wrong, it's your fault for failing to know that.
If the order is valid, it's your fault for questioning it.
You‘re supposed to evaluate it in order to determine whether it’s wrong or not.
I believe that's exactly what the GP was saying.
There are military lawyers for this. I seem to recall that Trump fired them last month.
Lawyers provide legal advice but are not judges.
By lawyer, I meant that https://en.wikipedia.org/wiki/Judge_Advocate_General%27s_Cor... . They also serve as judges, as far as I understand.
You don't have lawyer in the trenches. You have an order, if you don't obey, you might be executed at place.
Real life is not like the movies. You aren't executed for disobeying or refusing an order in the US military.
> You have an order, if you don't obey, you might be executed at place.
Uhhhh... not in the US (or any western) military you won't.
But if you're a soldier of the Klingon Empire, you might.
So why post it?
> He’s literally the richest person the earth has ever known
This is arguable in real terms.
Yeah. He’s not even the richest African emmigrant… because Mansa Musa tipped so heavily he broke intercontinental trade dynamics.
> Mansa Musa tipped so heavily he broke intercontinental trade dynamics
Thank you for dropping this fun fact. Pretty telling of my "western" education, I have never been taught anything about this guy. Quite memorable years of reign too!
Thanks for that factoid, interesting piece of history.
350b USD buys 350kT of gold.
I suspect that many zeros were unheard of in pre industrial times, making most hundred billionaires richer than Mansa Musa even in absolute terms.
> 350b USD buys 350kT of gold
No it doesn’t - that much gold hasn’t been mined in the history of humanity. Gold is not a good metric for comparing this across history.
That's the whole point. 350b is an enormous amount of buying power
Mechanically it doesn't work for two reasons: Elon's wealth is not liquid and him buying into the market would raise the price of gold far before he got anywhere near all of it.
But going further, I think you're misunderstanding my point - gold is a terrible measurement of wealth on the "human-history" time scale. At that scale, you have to consider monetary wealth as it relates to "the power to get things done" in general.
In that framing you can look at:
1. Power/wealth relative to the next most powerful people (like the Mansa Musa story). For pure wealth we often look at this in relation to country/global GDP.
2. Absolute ability to get "work" done, including technological changes.
3. Relative ability to get "work" done, adjusting for technological changes.
He's probably not close to top 10 in #1, because his relative power compared to the next most wealthy or powerful people is not that disparate, he just wields it more blatantly than we are used to in the modern era. For example, Augustus is believed to have personally controlled 6% of the world's wealth, not accounting for his power over the Roman Empire.
Elon is probably in the top 10 or so of #2, behind all modern US presidents, Putin, Xi, and maybe a few other world leaders. There's no doubting that his wealth could be converted into far more kW of work than at any other time in history as a result of technological leverage.
Much like #1, this is probably not close. The Ming Dynasty leaders, Augustus Caesar, Ghengis Khan, etc.
> Even a sliver of that capability and influence ensures nobody will ever dare to try and slap some cuffs on him
After 2028 elections, all of that umbrella cover will go away. Optimistically speaking it could happen as soon as after Nov of 2026 (midterms).
Re: 2026, it's possible Democrats could take back the House, and then be able to impeach the President. But it looks like they would need to win 32 of the 33 seats up for grabs in the Senate - 20 of which are currently held by Republicans in solidly red states - to guarantee the 66 votes necessary to convict. That seems unlikely.
And think about what would need to happen if you'd like to see actual change in leadership of the executive branch. You'd need the House comfortably controlled by Democrats, with the Senate controlled by a supermajority of Democrats. I think that you'd need both the President and Vice President impeached, convicted, and removed from office, while preventing the current/acting President from having a new VP nominated and confirmed, so that the Speaker of the House became acting President. This seems even less likely.
> But it looks like they would need to win 32 of the 33 seats up for grabs in the Senate - 20 of which are currently held by Republicans in solidly red states - to guarantee the 66 votes necessary to convict. That seems unlikely.
Your numbers are on point. But, there's another Math that could take us on that path leading to the same goal: A lot of republican lawmakers aren't happy currently. Although it's a long shot, some of them could join Democrats in impeaching those two clowns.
It happened over Nixon, whose crimes were much less serious… relatively trivial, even.
The next test of this will be the WI Supreme Court election - if the Musk-backed candidate loses (after Musk spends millions of dollars on the campaign, possibly illegally), it might start to break the hold Musk+Trump have over Republican elected officials.
Wasn't Trump impeached twice already last term without any consequences?
Impeachments without a two thirds majority are largely exercises in political playing around. You can use them to expose information that people are keeping hidden through subpoenas, but you can't convict in an impeachment without a two-thirds majority, which is definitely not happening.
The elections are already being taken over .. in newspeak of course.
PRESERVING AND PROTECTING THE INTEGRITY OF AMERICAN ELECTIONS
~ https://www.whitehouse.gov/presidential-actions/2025/03/pres...
source~ https://talkingpointsmemo.com/news/trump-order-includes-prov...There are several commentaries at length going into the hidden traps and pitfalls of this latest executive order kicking about, so far it looks loaded.
He already said if he won you would never have to vote again but for some reason people didn't take him seriously.
Is that true/source?
In the video, trump urges people to go out and vote, in which case telling them "just this time" and "you won't have to do it anymore, 4 more years, it will be fixed, it will be fine"
When I watched the video, I saw no malice.
https://m.youtube.com/watch?v=gE7xoHJkgvE&pp=ygUqdHJ1bXAgc2F...
Coincidentally, you omitted the spicy addendum transcribing your own source, making his statement sound ambiguous. Here is what he said after your oddly selective excerpt:
"In four years, you don't have to vote again. We'll have it fixed so good, you'll not gonna have to vote."
https://youtu.be/gE7xoHJkgvE?t=40
Telling people that it will be "fixed" so they "won't need to vote" was enough for me
Unlike with Musk's "heart goes to you", if there is some context that can turn this into a benign remark it would have to be truly radical. Any takers?
>Trump said: "Christians, get out and vote, just this time. "You won't have to do it anymore. Four more years, you know what, it will be fixed, it will be fine, you won't have to vote anymore, my beautiful Christians."
>He added: "I love you Christians. I'm a Christian. I love you, get out, you gotta get out and vote. In four years, you don't have to vote again, we'll have it fixed so good you're not going to have to vote," Trump said.
https://youtube.com/watch?v=gE7xoHJkgvE
https://www.reuters.com/world/us/trump-tells-christians-they...
Fortunately that EO is completely illegal and unenforceable, as the president has essentially zero say on how state elections are conducted.
It doesn't have to be enforceable at the point where voting actually occurs. It's just a prepared excuse to disqualify electors. Let's say Republicans in Congress circle the wagons around Trump and refuse to admit any new members from states that ignore the EO, like, physically. What then?
On what basis do you think 2028 elections will be free and fair? Congress is going to try to mass-disenfranchise women before the 2026 midterms. They've stated this on the record. Dems aren't going to gain control of congress in the upcoming special elections. We're totally fucked economically and otherwise unless Democrats in congress -- mainly the Senate -- can get a fucking grip, pay attention to what's happening, and be the opposition party we need.
> Congress is going to try to mass-disenfranchise women before the 2026 midterms. They've stated this on the record.
What on Earth are you talking about?
I assume they are talking about the SAVE act:
https://19thnews.org/2025/03/save-act-voting-married-women/
> An estimated 69 million American women and 4 million men do not have a birth certificate that matches their current legal name, according to the liberal Center for American Progress.
Not to worry! Per the "Preserving and Protecting the Integrity of American Elections" executive order, birth certificates are not valid proof of citizenship for the purposes of voting in a federal election anyway.
Isn't an ID, like a driving license/passport, enough to vote?
It depends on the state as far as I understand it.
You need to be registered as a voter, which requires that you be a citizen. How that is enforced varies.
There are also ID requirements at the poll site. Again, those vary.
In every state I've lived in voting was in some way (optionally) tied to your driver's license. But the body issuing the license has always known whether or not I was a US citizen so it boils down to the same thing.
Driving license, no, because non citizens can get one. Passport, yes. But plenty of Americans don’t have a passport.
The OP would say these people are being deliberately disenfranchised. Personally I’ve long since given up judging these things based on what I think may or may not be in the hearts of those writing it. We don’t know so it just becomes an endless back and forth. Instead I look to the facts: the SAVE act would make it more difficult for many people to vote, with an aim of stopping those who are unauthorized to vote from doing so. There’s never really been any solid evidence of the latter happening in notable numbers so to me the trade off doesn’t feel worth it.
IMO something like the SAVE Act needs to also legislate the process by which a citizen can easily get an ID in order to vote. But it doesn’t, it just says that states would manage it. Given that some states used “literacy tests” to disenfranchise black people not so long ago I personally don’t trust they would all approach ID access in a fair and equal way.
Slight correction: there's a thing called "enhanced driver license" that some states issue that complies with the relevant federal standards and can serve as proof of citizenship (they are only issued to citizens). It is, in effect, a passport card combined with a driver license on a single card.
According to https://www.dhs.gov/real-id/real-id-faqs
> Yes. All states, the District of Columbia, and the 5 territories are REAL ID compliant and issuing REAL ID compliant driver’s licenses and IDs.
I have a DL in US and I'm not a citizen. It says on the license that it's only for driving and not for employment or voter registration.
> IMO something like the SAVE Act needs to also legislate the process by which a citizen can easily get an ID in order to vote
That sounds like real id to me?
I believe they are talking about the SAVE act, which would apparently introduce new requirements for voter registration, supposedly making it so that identification and legal birth names would need to match in order to register to vote which could impact married women. I am not taking a position on the correct interpretation of the act, just stating initial search results.
I looked at the act and I don't see anything claiming that ID and legal birth names have to match. Birth certificate only has to be provided if you have no ID showing you were born in US
… what ID shows you were born in the US? I was born here, am a citizen, have a passport, but don’t have such a thing. Aside from my birth certificate. What else is there?
Your passport does.
According to https://www.dhs.gov/real-id/real-id-faqs "Yes. All states, the District of Columbia, and the 5 territories are REAL ID compliant and issuing REAL ID compliant driver’s licenses and IDs."
So from my understanding all DLs would qualify too (Except maybe older ones that were issued before real id?)
Last I checked, we’re just a little over 50% with real id. That’s why they’ve kept pushing back the requirement to have one to fly (they might finally do it this time?)
I’ve tried to get one twice since they started doing them, in two different states, and failed to have one thing or another on the bills and paystubs and such that I took in, so don’t have one. My wife’s got it even worse, they need an original of our marriage certificate (due to the name change) and that’s gone missing. She hasn’t bothered to screw with it, because she’s got a passport anyway (which, as you note, will do after all, I was wrong)
My passport says I was born in New Jersey. I suspect yours lists your state of birth as well.
Yeah, you and the sibling are probably right and I’m just unobservant (if I could remember where the hell it is at the moment I’d verify, but probably it’s in there)
I don't know about your passport, but my passport has a field for country of birth.
That example is poor justification.
Let me give you a better one.
Trump can arrest the electoral college members from the blue districts under the guise of election fraud. And if that doesn't work, Vance can just pick his own set of electors. Remember, the Supreme court made it legal for Trump to literally drone strike US citizens without legal recourse.
Of course this will cause a bunch of Tumroil, which is good for Trump, because he can just holdon to power.
If you think that has no chance in happening, I envy your optimism.
There are many scenarios that are possible, but this one wouldn’t work for the 2026 midterms.
The midterms are Congressional elections. There is no Electoral College. The Electoral College only functions when electing a President.
Well see, but at this point crazy is full on the table and has a definite chance of happening. I legit would not put it past Trump to institute martial law during any elections.
> Congress is going to try to mass-disenfranchise women before the 2026 midterms.
That's only if the SAVE Act passes, or whatever else they dream up passes. The House can pass whatever MAGA wants, but the Senate needs votes from Democrats to clear the filibuster.
Unless of course the GOP yet again does what they say they'll never do, and drop the filibuster.
The filibuster is a simple rule, and can be removed by a simple majority vote.
I actually expect Republicans to do so soon enough now that their control of the Senate is virtually guaranteed for the foreseeable future, and they are reaping all of the disadvantages of the filibuster without the benefits.
> Optimistically speaking it could happen as soon as after Nov of 2026 (midterms).
The midterms could have some meaningful effect a lot sooner than that if we start seeing across-the-board primary challenges of pro-Trump Republicans. Of course, all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
More likely is that competitive districts flip blue. Republican primary voters don’t seem to be upset. They’re getting what they wanted. It’s independents/undecideds that flip flop every election that could sway back against the GOP after getting tired of democrats in 2024
> all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
> Republican primary voters don’t seem to be upset.
Replying to both of you. It has started -> https://thehill.com/homenews/campaign/5214236-democrat-james...
So you're saying there's a chance that democracy can hold?
democracy has been holding. The democratically elected president is in charge.
I don't think it's really pushing things to say that President Trump is taking actions to destroy democracy in America. Basically he's step by step attacking the institutions that might be able to stand against him or resist him. He attacks judges that rule against him, he attacks congressman on the Republican side if they look like they might go against him. That's anti-democratic
True, but I don't think you're really arguing against what GP and above said. Sure, he's taking those actions, but it's far from clear whether or not he'll succeed. Those judges are so far standing up to him. Even Chief Justice Roberts publicly pushed back, something highly unusual.
The attacks members of Congress are troubling, but in a way don't matter too much: the deciders for control of the Senate or House are swing voters in swing states and districts. Whether or not the Republicans in Congress are MAGA adherents or older-school reasonable Republicans matters less than you'd think (and less than I'd like).
The one wrinkle in that is the Senate filibuster: if Democrats regain control there, depending on their margin, they could need up to 10 reasonable Republicans in order to make progress on most things. 60 Democratic Senators is unlikely.
The filibuster is a Senate rule, which can be changed with a simple majority.
Trump was elected by the whole US population. Why does a judge, who was not elected by the entire US population, is able to block the democratically elected president? To me, it sounds like the judges are the ones "destroying democracy" as they are blocking the will of the people.
What has Trump done to take away votes from people? Every election is still happening. US citizens are still able to vote.
What you are describing is not a constitutional democracy. It is a kind of mob rule.
Our balance of powers works that way, it's not a novel concept that was just invented. The president does not have some special power because he won the electoral college election, majority of voters, plurality or whatever. He still has to follow the rule of law, he still has to obey court orders. If the president does some action that a federal judge rules was illegal, then they can stop it. This is completely ordinary and every president faces this, Biden, Trump 1, Bush2, Reagan etc.
> all of this is assuming that the broad Republican constituency have to some extent gone anti-Trump, and I really don't know how much basis there is for that assumption.
Seems to be absolutely no basis for that assumption. His approval ratings are in the mid 40s, and the people that vote in primaries aren't exactly the waverers and independents that just wanted a change from Biden.
It could change when he properly tanks the economy, but association with Trump isn't likely to be a problem in primaries when you've got more than half a party's membership so immune to reality they'll insist that not only was Trump doing a good job of running the country in 2020, but he also won that election...
If Trump is on a path to tank the economy, the asset markets will react immediately to that prediction and everyone will know it. This may well be the most tightly binding constraint on Trump and Musk's actual behavior right now. Right now markets are doing worse than was predicted after the election but they're not that terrible. This seems to predict that Trump will muddle through somehow, as the most likely outcome.
Which is precisely why there won't be 2026 and 2028 elections. I dunno why people are pretending this is just 4 years of Trump. He tried to overthrow the results before, and this time around, he has support of all 3 branches and players like Elon Musk.
US is going to do the same thing Russia did with Putin.
If we end up having elections, its actually gonna be worse of long term, because despite tanking economy, most people aren't going to suffer that much, which means the pattern of Dems inheriting a shit economy, everything getting blamed on them again like with Biden, and then a smarter Republican comes along and its a repeat again in 2032.
If we have an election in 2026 and 2028, will you reassess your convictions? Or just carry them forward without re-evaluation?
The main difference between the US and Russia in this regard is that the US federal government has very little say or control over what are state-run elections.
Solidly red states don't need election interference; they're going to vote red. Solidly blue states aren't going to tolerate interference. The handful or so of swing states will be watched incredibly closely by everyone else for even a hint of interference.
> and then a smarter Republican comes along and its a repeat again in 2032.
I mean, this is just how American politics works now, and has worked since extreme political polarization took root. That's what happens when you have FPTP voting and a two-party system, where members of each party show complete disdain (justified or not) of members of the other party.
FWIW, the first thing Putin did after he got elected wasn't to mess with the elections; rather, he methodically strangled all remaining free press in the country above a certain threshold. Basically no opposition TV at all, only a couple of radio stations and newspapers. Massive electoral fraud orchestrated from Kremlin only really began post-2008.
Ok and what are states gonna do when Trump arrests the electors? Secede?
Look at what Dems are doing now. AoC and Bernie are hosting rallies - i.e being worthless.
States will roll over, because day to day business is gotta continue.
> Trump arrests the electors?
These types of speculative remarks insinuating trump is a dictatorial nazi is very lazy. If you disagree with his policies, debate the policies.
It's completely reasonable to think and plan ahead, especially when we are dealing with someone who is refusing to acknowledged a democratic loss. This is not theoretical, we know how he reacts when he looses a election.
>reasonable to think and plan ahead, especially when we are dealing with someone who is refusing to acknowledged a democratic loss.
>This is not theoretical, we know how he reacts when he looses a election.
It sounds like from your perspective, the sequence of actions should be pretty obvious: create a market on polymarket or something for Trump to not acknowledged a loss, put up some money on it, and at the expense of people who perceive this question as theoretical you should easily get your x20-x30 insurance if something like that happening and can go to live in Europe in your own mansion (or even castle, there are many of them in Europe).
I guess it's telling that faced with the prospect of the fall of American democracy, the obvious thing is to start gambling on it.
I don't know how much I would gamle in such a case. There are many outcomes compatible with his previous actions. Maybe he gets a heartattack. Maybe there is no election. Maybe the election process is manipulated so he wins. Maybe he actually wins, fairly or 'fairly'. Maybe they find a way for him to run, maybe it's Vance. Maybe someone else.
The important thing is that we should prepare that shitt will happen, and democracy don't survive automatically. We literally have him on tape, pressuring Georgia secretary of state to "find 11,780 votes" and overturn the state's election results. And it is not 'lazy' to prepare (intellectualy and physically), and when it happens it's too late to 'discuss the politics'.
Speculative?
You are probably not aware of this, but these are the events on and leading up to Jan 6.
* Trump calls fraud on elections with no real evidence. Lawsuits are filed. Every single one of them gets dismissed except like one, which ends up turning more votes for Democrats anyways
* Some adviser puts in an idea in Trumps head that Pence can reject the results and send them back to the states
* Trump basically gathers a crowd together, tells them to march to the capital to save our country. As the protesters are breaking in, there are records of him just calling different senators and asking "are you sure you don't want to delay the certification of the vote", all while being told that protesters are breaking in and getting hurt.
* Trump sends a fake set of electors from key states, calling on Pence to "do the right thing". Those fake electors were of course arrested and prosecuted.
None of this is disputable, undeniable, as it was brought up in a republican controlled supreme court hearing, which you can read for yourself. Supreme court decided that President is basically immune from legal punishment as long as he is acting within official capacity.
So saying he is gonna do more shit this time around, granted that he has legal immunity to do so is about as speculative as saying the guy who does 2 Nazi salutes probably believes that the Nazis were right in a lot of things.
>Which is precisely why there won't be 2026 and 2028 elections.
Care to place a wager on it? I precisely bet you will ignore this offer though.
If you don't believe he'll find a way to get a third term like every other dictator, you're living in a fantasy.
Do you truly believe this will happen? I know these are crazy times but the idea of a then-82 year old man realizing a third term for himself seems a little absurd to me. Or do you mean this in a less literal sense, e.g. in the sense that he'll get a figurative "third term" by handing the reigns over to someone in his club without a fair election?
No I mean literally. Or he'll do what putin did and find a puppet to take the reigns for a term.
He knows without presidential immunity he risks prison. And he has previous for trying to steal an election.
I have no doubt he'll see to it that he never faces the risk of prison, and this is the most obvious way to go. That and he's clearly a power hungry megalomaniac.
I think it'd be more informative to ask why he wouldn't try to get this.
Downvoted but he even admits it: https://www.theguardian.com/us-news/2025/mar/30/trump-third-...
> He’s literally the richest person the earth has ever known.
That’s disputable
> He literally commands the most powerful military apparatus the world has ever seen.
That’s also disputable
>> He literally commands the most powerful military apparatus the world has ever seen.
> That’s also disputable
Why? Which military has ever existed that would have a chance against the current US military?
Taliban.
Conventional armies have a hard stand against partisans.
The US in Vietnam and Russia and the US in Afghanistan.
So the taliban or the Vietcong were more powerful than the US military? They won because they were defending their own country which gives them higher motivation and an advantage as defenders. If you look at the military itself, the US was always much more powerful.
If you lose nobody cares about how powerful you are.
The Russian army is more powerful than Ukraine‘s, still no win. Same with Russia in Afghanistan.
Ok, but they still are more powerful. That’s what the discussion was about. Having a disadvantage and losing doesn’t mean it’s not the most powerful military that ever existed.
But it a useless measure if the results aren’t as expected.
That’s like saying I have the most expensive car in Formula 1.
Powerful is associated with winning that’s the whole point of pointing it out.
No, it's like doing a drag race with a formula 1 car against a mini but the mini is on a street and the formula 1 car is on a dirt strip. If you want to compare military power, you would have to look at "Who would win in equal situations", not "Who won a 1 vs 1 with different starting situations".
If you had to perform a military action and had to pick either the taliban or the US military to be your military to use, would you ever pick the taliban?
The only reason they had a chance was because of external factors, not the power of the military itself.
I'm not sure if you are joking or not, but anybody who measures military power doesn't actually looks at things like ability to do something. Talbian and co simply survive and don't give up. But they are totally incapable of anything else beyond that.
> Conventional armies have a hard stand against partisans.
No they don't. Its just not worth doing in the long run.
And whatever you may think of the US military forces, they have the ability to do lots of things.
Anybody who cares looks at the results.
Result beats potential.
And most of the US military except the special forces need time of from work and visit the army shop.
Anybody who actually cares, you know actual professionals, looks at things beyond a very limited set of real world results in very restrictive circumstance.
That's like saying, this NBA team after a 5d journey, and no sleep played a basketball game against a local team, with the whole crowd hostile, a complete broke court and a totally different ball.
And even then they would win for 20 years straight and the other team is only annoying to deal with. Until the owner decide there is no point in it.
And from this you conclude that that NBA team is bad at basketball because 'real-world results'.
guy forgot what he was told to never forget
So the Taliban have ten aircraft carriers and the ability to bomb any target on Earth without losing the plane?
You are delusional, if you think the USAF can bomb any target in any airspace without losing the plane. If losing the plane is allowed, you have to admit, the Taliban have been exceptionally successful, too.
> You are delusional, if you think the USAF can bomb any target in any airspace without losing the plane.
You're delusional if you don't think that. You could just launch a few dozen cruise missiles at the target and at least one will make it through.
Depending on the target your cruise missiles are out of range and your fancy aircraft will have to face air defense systems. (Especially, since you moved your fat ass carrier close-by...)
So, does your magical aircraft carry those dozens of cruise missiles, immune to every modern anti-air missile it will encounter? You know, instead of spending all that money on aircraft carriers, some countries have spent their money on air defense instead. Try to fly an F35 to Moscow.
Sorry, but this is laughable. If what you said was true, geopolitics would look very different. The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike. Why even have nukes then?!
> Depending on the target your cruise missiles are out of range and your fancy aircraft will have to face air defense systems. (Especially, since you moved your fat ass carrier close-by...)
Right, but the scenario was unspecified enough that I assumes peace time and the planes can retreat before the enemy notices the attack and shoots them down.
> Try to fly an F35 to Moscow.
I won't fly my F-35 to Moscow, I will drop some AGM-158 JASSM-ER over eastern poland and the pilots will probably be back on the ground before the russian air defense has even tracked the missiles.
> Sorry, but this is laughable. If what you said was true, geopolitics would look very different. The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike. Why even have nukes then?!
No, I don't get why people think that. That's the exact reason why countries have Nuclear missile subs. So they can retaliate, even after a first strike.
But even if they hadn't, what you said wouldn't follow. Because having the ability to strike whatever you want doesn't mean you can prevent a second strike. If you launch cruise missiles, the target can detect them and send a retaliatory nuclear strike before the cruise missiles arrive and destroy the silos.
> The US would break the whole nuclear deterrence game, since you could eliminate all nuclear launch sites, conventionally, before a strike.
I didn't say the US could hit all points on Earth simultaneously. Russia has a bunch of nuclear silos and submarines. Brighter Russians than you have designed their nuclear arsenal to survive this US capability.
I don’t want to downplay your point, I basically agree, but in real terms I believe there have been several people richer than him, and it is hard to judge the relative wealth of people long ago.
Elon was uniquely rich is US history but his wealthy fluctuates wildly:
https://finance.yahoo.com/news/rockefeller-rich-elon-musks-w...
I don't like this market cap against GDP measurement. The multiples in Market Cap in those era would be significantly lower. If we look at P/E of S&P 500 [1], what used to be peak PE of 20 a century ago are now considered normal.
So adjusting for all that Rockefeller would still be richer than Elon.
[1] https://www.multpl.com/s-p-500-pe-ratio
> He’s never going to suffer financially
Well his wealth can decrease by 200x and no sane person could claim that he's "suffering" financially with what he has left.
> somehow go bankrupt .. were also wild
That depended entirely on how Tesla's stock performed. If he had to liquidate $20 billion of his stocks to pay back the Twitter loans his wealth would have decreased by much, much more than that.
> He’s literally the richest person the earth has ever known.
Rich people become poor people all the time. Its hardly unheard of.
> He’s literally the richest person the earth has ever known. He’s never going to suffer financially. He has countless levers of power he can pull.
Just being rich doesn't mean he's got all the power to stop that: https://en.wikipedia.org/wiki/Bernie_Madoff
Him being a Trump associate is a lever, but not a financial one… unless and until they have a falling-out. I'd be surprised if that's any less than 6 months away, or more than 3 years away.
> The same fantasy applies to any past or current president ever spending a day in jail. He literally commands the most powerful military apparatus the world has ever seen. Even a sliver of that capability and influence ensures nobody will ever dare to try and slap some cuffs on him
Depends if he dies in office (~10% all causes, he's old etc.), and if the dems regain congress in two years.
Trump was already very close to getting one day in jail due to inability to behave himself in the trial where he got all those felony convictions, and he did get impeached twice.
> unless and until they have a falling-out. I'd be surprised if that's any less than 6 months away, or more than 3 years away.
That's the other thing: Trump's tastes and whims are super fickle. Trump and Musk have already clashed on a bunch of things, and there's no reason to believe that won't continue and/or get worse. And Trump's priorities could change, without a corresponding shift in Musk's.
I have no opinion about Musk or Trump. I just want to give counter-examples to your claims: Saddam Hussain, Mussoloni, Ceausescu. At the peak of their power, they all seemed untouchable. Would they even have thought, when they were ruling their countries, that one day their fortunes would turn?
Quoting Gandhi: "There have been tyrants and murderers, and for a time, they can seem invincible, but in the end, they always fall. Always."
I think if we look around the world we can find plenty of counterexamples to Ganhi's quote.
Sure, they always "fall" in the sense that they're not immortal and they'll eventually die, but it's often (usually?) the case that a family member or some sort of protege steps up to fill their shoes.
The first counteraxample that comes to mid is Idi Amin, the Ugandan dictator. He murdered, pillaged and lived out the rest of his years (happily and luxuriously) in Saudi Arabia.
He lived "in a villa rented for him by the government of Saudi Arabia in the posh Al Hamra district". https://www.dawn.com/news/135283/idi-amin-led-quiet-life-in-...
South Korean president is jailed for trying to coup, no? So there’s precedent.
He’s been released.
I mean this is exactly the reason why they won't want to put Trump in jail - so that it doesn't turn out like in Korea. After all, where you can put one president in jail, you can put a next one in jail too.
I mean, yes? Where you can put one president in jail (for trying to demolish democracy and establish oligarchy/autocracy), you can put a next one in jail too (if they try to do the same)
This is called upholding the constitution and it’s fundamental for a democracy. If you say president is immune, you get current US.
>If you say president is immune, you get current US
And even most leftist woke socialist president between probability of a prison for himself and the current US will choose current US.
This word soup means nothing.
>He’s literally the richest person the earth has ever known.
Putin might well be richer.
Also it is hard to compare his wealth to historical figures, such as Mansa Musa.
https://en.wikipedia.org/wiki/Mansa_Musa
I’m pretty sure the owner of the monopoly board game company is the richest person ever.
Past presidents don't hold command over any military. France sent a former president to jail just a few months ago. Brazil and South Korea are in the process of putting a former president on trial. El Chapo was billionaire and had a private army of murderers – he's currently in prison.
The main reason Trump hasn't been impeached and (possibly) jailed is because the political system in the US is dysfunctional. Party because it's not a great system to start with, and partly because a critical section of people made the decision to intentionally break it for selfish gain. But there is nothing that says it needs to be like this.
We know how it ended for Rasputin.
IMHO the US is turning into an oligarchy / autocracy like Russia. Musk is one of the oligarchs. We all know what happens to oligarchs when they get too close to eclipse the top dog and go near a window.
He only holds ~15% of Tesla. His real money is in SpaceX... 50% ownership there. I wish people would think just a little before parroting the "hit Musk where it hurts" drivel.
At the rate he's going, SpaceX is probably on its way to being nationalized within the next few elections.
And that would make sense totally aside from punitive response: it is pretty dangerous to have such vital defense infrastructure controlled by such a mercurial personality.
According to existing Supreme Court precedent[1], nationalization of companies requires approval by Congress, not just the President, so that would make it more difficult.
[1] https://en.wikipedia.org/wiki/Youngstown_Sheet_%26_Tube_Co._...
According to existing Supreme Court precedent, the president isn't able to impound funds which had been allotted by Congress (line item veto) [1], or fire the head of an independent agency for reasons other than allowed by Congress [2], it doesn't really seem like precedent has much weight amongst those in power today.
[1] https://supreme.justia.com/cases/federal/us/524/417/
[2] https://en.wikipedia.org/wiki/Humphrey%27s_Executor_v._Unite...
Precedent, with this Supreme Court, is meaningless.
> And that would make sense totally aside from punitive response
So the government has spend the last nearly 50 years completely failing in building rockets or sats the way SpaceX did. SpaceX with little money did it in less then 20 years.
And now you think its smart to have have the government taking over again? Do you want the government to run the global Starlink network, dealing with costumer complains?
What part of NASA or any part of the government in the last 20 years convinced you that they could operate SpaceX?
DoD tried to make space good and literally created ULA and after 10 years they often paid 300+ million for a launch?
And just FYI, Starshield is Starlink for the government and the government already controls those themselves.
The US government could buy out Musk, keep the company public while owning a majority of the shares and do nothing with them unless the company does something incredibly stupid.
That's how China does it.
That's also how Europe does it and its even worse then the US. And China rockets aren't all that impressive.
Also, the US has little history of this and the history it does have is utterly terrible. Go look up the performance of US own weapons factories threw history, basically just a long list of failure that lead to real issues in wars.
The US does not need to own the company to be able to prevent them doing something they don't want.
The current administration has shared favorable views on "public-private partnership", which suggests that outright nationalization isn't the goal; I'd imagine the more likely scenario is that national assets will be dismantled and their functions will instead be contracted out to private operations with horrendously corrupt deals.
"within a few elections" = not this administration
Yes let's just have a fascist government that can seize private property because they declare it "dangerous." I see no way that could go bad.
Massive conflicts of interest exist between him and foreign adversaries of the US:
https://www.wsj.com/world/russia/musk-putin-secret-conversat...
https://www.reuters.com/world/europe/putin-envoy-says-russia...
If this were the Cold War, we'd have already seen USG freak out and move to nationalize.
The US government's behavior when freaking out during the cold war reads like a list of things that governments shouldn't do.
You're not wrong, and I get the aversion to any [modern] precedent that nationalization sets. It's not one I'd like to see set either.
I think the more reasonable crux here is why there was no clearance revocation. The guy inserted himself into geopolitics in a manner that ran counter to DoD and USG foreign policy while operating critical defense infrastructure, temporarily (with limited scope) revoking an allied nation's access[0], and being privy to secrets involving said infrastructure.
If in the future we're putting SDI-like capabilities onto satellite constellations his company operates, why let someone with undeclared back-channel comms with a foremost strategic adversary be cleared on the design and operational details of something critical to US strategic defense and national security? The very adversaries that such programs are designed to counter and deter.
That's before you even consider instability from doing every drug under the sun, which normally would be sufficient grounds alone.
I've no doubt he believes himself to be a patriot and probably hasn't violated his oath. It's just that holding a clearance has traditionally been based on risk. Regardless, not like there's anything anyone can do about it now.
To put this in perspective, Canada's wondering lately if the US is going to attempt to annex them. Should that happen, it definitely seems like a foreign policy objective of an adversary of the US, rather than one in the interests of the US.
I'd like to think any reasonable person views this entire situation as nutty, regardless of what side of the aisle they're on.
[0] https://apnews.com/article/spacex-ukraine-starlink-russia-ai...
I would be much more sympathetic to this argument if we hadn't seen Musk and the other oligarchs get away with anything and everything over the past two decades. Especially now that Musk holds a position of very considerable power in the administration, and without the approval of congress.
It seems to me that Musk may very well spend the next 4 years cutting everything he can from NASA, NOAA, the Post Office, and other federal agencies. Those capabilities will still be needed, and it is clear from the stated goals of those steering this administration [1] that they intend to steer as much as possible into private enterprises. Many of those enterprises are owned by Musk himself.
I don't know about you, but I see a major conflict of interest with one person both guiding the privatization process and profiting from it. If we do see a case where he steers federal funds from government agencies into a private company - at the cost of the ability of our government to execute critical functions without enriching Musk himself - then I have absolutely no issue with reclaiming those capabilities.
[1] https://qz.com/donald-trump-privatize-us-government-project-...
I agree on the conflict of interest part, but that conflict can be removed by winning elections and not some authoritarian seizure of private property. If Democrats controlled the government to the point that they can seize private property, he wouldn't be in government in the first place and there would be no conflict.
After the conflict of interest is resolved, what next? The capabilities are still lost. He has still gained wealth from malfeasance. What's the next step? Pay him more money to fill the gaps created by corruption?
No, the answer is to ensure any profit from corruption is reclaimed. The idea of "just let the corrupt keep what they stole" has led us right here to this moment.
EDIT:
I do want to be clear on what my concern is here, too - I don't have a problem with commercial space flight. I wouldn't have a problem with NASA using commercial vendors for a major of their missions. I would have mild concern but not a great deal if NASA dropped most of their launch capabilities, retaining only ones needed for specialized missions and unique orbits. But I wouldn't oppose it like this.
But I have a major issue with that process being run by the one person most likely to directly profit from it. That completely destroys all faith that the process is being done in a responsible way that will put the well-being our nation above the wealth of a single individual.
Yup, I agree that this is the playbook here.
Some of the cuts will just be cuts, and those services will be gone, in case where Trump's and Musk's cronies don't think they can build a profitable business around them. Others will just get pushed into private hands, and then when progressive administrations come into power, any attempt to bring those functions back into the federal government will get lobbied out of existence.
If lobbyists can do comparatively low-stakes stuff like keep the IRS from sending people pre-filled tax returns, you better believe lobbyists can keep NASA, NOAA, USPS, etc. privatized once they're dismantled.
Is it a "fascist government seizing private property" if Congress votes to nationalize a company, as is laid out in law, and the president signs the resulting bill into law?
I mean yeas, that is a typical fascist strategy.
Also a typical strategy in every other form of government, oddly enough.
Some research may be warranted on your part before you have a kneejerk reaction. The US has nationalized businesses in the past even when those business were solvent [1]. SpaceX would of course be a larger case and much more politically fraught, but I don’t think nationalizing SpaceX automatically makes it a fascist government.
Oh, and you may want to look up eminent domain. The government regularly seizes private property and even does so effectively on behalf of other private entities. If you’re actually consistent on your framing then you’d have to admit you’ve lived your whole life under what you consider a fascist government regardless of political affiliation. For example, here’s [2] Trump using the government’s eminent domain power (before he was president) to take property from another private entity. And here he is doing the same thing [3] as president.
[1] https://en.wikipedia.org/wiki/State-owned_enterprises_of_the...
[2] https://www.cato.org/commentary/donald-trumps-eminent-domain...
[3] https://brooklynworks.brooklaw.edu/blr/vol84/iss2/3/
Your source states that the nationalization was done either in the case where the government was owed a debt by the nationalized company or in the case of the railroads, where they were seized to ensure the continuation of a vital service where the company providing it was insolvent. Neither of these conditions apply to any of Elon Musk's companies.
Eminent domain is a process where the private property is seized (with the government required to pay fair market value) in order to use that land for some public purpose that it is not currently being used for. This could potentially be done to property owned by Elon Musk, but not for the justification that he has too much power. And also it must be specifically land that is seized, not equity in a company.
If congress passed a law seizing his property, or the government initiated eminent domain against all of his company's properties, it would be obvious that it was Elon Musk being targeted and not any legitimate public need for a piece of land. This is a called a bill of attainder and is unconstitutional. https://en.wikipedia.org/wiki/Bill_of_attainder
This whole narrative of "big government with lots of power = bad" doesn't really apply anymore. US has shown the citizens no longer deserve the freedom that they had, because we can't be responsible with it.
We do need a big powerful government full of Democrats to run things. US economy grew under democratic agenda, and Democrats have proven that they actually do give a fuck about the country, so they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base.
Because if you want to make the argument that this will tank the economy as free market capitalism is reigned in, that also doesn't fly considering the economy is being tanked right now. The difference is, under Dems, once things stabilize, everyone will be better off.
>This whole narrative of "big government with lots of power = bad" doesn't really apply anymore.
>US has shown the citizens no longer deserve the freedom that they had
>We do need a big powerful government full of Democrats to run things.
>Democrats have proven that they actually do give a fuck about the country, so they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base.
And after that they say that it is the Trump who is the fascist.
You are why I vote Republican
Ah yes, the classic "your rhetoric annoys me so I'll instead vote to burn everything down and I don't care who gets hurt in the process". Good reasoning, there.
Annoyance has nothing to do with it. It is the authoritarian morally superior attitude expressed by this statement that is so prevalent among Democrats.
> they should have more power to unilaterally exact laws and legislation without trying to appeal to the Republican voter base
> US has shown the citizens no longer deserve the freedom that they had,
As opposed to the morally superior actions of ... the other party so gleefully dismantling your country for a fire sale to the oligarchs.
Better the oligarchs than the lawyers and bureaucrats. At least I get something for my money with them
So, morality isn't a concern as long as you get something out of it, got it.
Too bad all you're gonna get is a botched and broken nation and years of misery, but that shouldn't matter as long as you get "something for my money".
And you're sure you're gonna get "something for my money" with people that make no attempts to even veil their corruption and lawlessness. Right? Say, are you, by any chance, "rich"? I mean, rich enough to be considered rich by the oligarchs, that is.
Im glad you do.
Here is the thing though - nobody can predict the future. Statistically, going by historical examples and knowledge, everything that Musk and Trump are doing is wrong in regards to economy, but there is a chance that they are actually right and everyone else has the "woke mind virus".
The thing you need to understand is that if you vote Republican, you aren't aligned with actual reality. The problem is that you see things as black and white - anything that has a sign of the woke mind virus has to be gutted and restructured. This kind of thinking is a case of the classic human bias where you chose to pay attention to the information that fits your narrative, while ignoring the information that does.
This in turn makes makes you less likely to predict the outcome of politics, much less prepare for it.
So if you want to place your bets on Republicans, just know that you can lose very hard, while people like me who are in tune with reality end up being better of.
Honestly, next election (if we even have one) Ill ironically be voting Republican as well, for the reason that I believe in accelerating US downfall. EU seems to be the better system going forward, and they need a nudge in the right direction to pick up the slack, and also institute more stringent society policing to prevent the same from happening to their countries.
Judging by the result of the 2024 election it is the Democrats who are much less in touch with reality and less able to predict the outcome of politics or prepare for it. Let's face it. You guys were completely blindsided by Trump twice, and the second time you had 8 years to prepare.
I don't think you fully comprehend what Im saying (or maybe you do and you are just being purposefully obtuse and/or trying to troll)
If we had perfect knowledge of what goes on in US politics, we would not be having this discussion. Instead, we are forced to parse information from different sources, and figure out what the reality most likely is in our head.
If you are unable to be unbiased (and you, and every other Republican are clearly not), towards information, the chances of you being able to predict reality accurately go way down.
It could very well be that US economy tanks so hard that we enter a pretty harsh recession, with lots of job loss, lack of social services we rely on, and so on. Its a possibility. I don't know that it will happen, but you also don't know it won't. The difference between you and me though is that because I don't blindly believe in one side being right and other side being wrong, I have a much better chance of seeing signs and taking respective action, like selling my house and moving out of the country before it does.
The TLDR of this is that you vote Republican because you are an idealogue. I vote Democrat because of rational decisions. If you want to continue doing this, its not my problem. The least I can hope for is if you do some critical analysis of yourself and figure out whether the things you believe are actually true or do they just sound good.
Musk can be fairly compensated and US national security preserved via nationalization.
How much is SpaceX worth? How do you even calculate that, knowing that a long term plan includes Mars colonization, astroid mining, etc, with it having a near monopoly on space transport, at the moment?
Some multiple on the last funding round (perhaps a multiple <1) would be perfectly sufficient.
Declaring my company has plans to build a Dyson sphere doesn't make it suddenly worth infinity money, and even if you believe it does, that belief won't stop the US government from seizing it.
You're irrational. They had $13B revenue in 2024, and profit > $4B, with the profit of the previous two years covering ~60% of their total accumulated funding to date.
Well now you're just quibbling about the amount; it seems you do agree that SpaceX can be valued. You just don't agree with the <1 multiple the GP suggested. So ok, how about a 4x multiple? 8x? Whatever! Private companies can be valued; it's done every day. SpaceX is not an exception here.
Musk can say he's going to colonize Mars or mine asteroids, but the markets are perfectly capable of deciding on how likely (or unlikely) it is that he'll succeed, and price accordingly.
Colonizing Mars is a money-loser. It could completely tank the company. What business model involves colonizing Mars and then making a profit off that?
Mining asteroids is something we're so far away from that it's not worth baking in at that point. With current technology, it's far, far, far cheaper just to mine on Earth, even for things that are relatively rare.
> Well now you're just quibbling about the amount;
Of course, the question was about how to estimate the amount. It's a nonsensical answer that doesn't attempt to answer or help answer the question. If they were funded $1, their answer would still be correct: non zero multiple of a non-zero number (their last round of funding). It's an answer with unreasonable bounds, on both ends, especially the lower (fraction of last round of funding, even though current revenue is an order of magnitude more). It also has no precedence. The value of a company is never estimated based on rounds of funding from years ago (last was 2023 for SpaceX). It's based on both the present and projected performance.
It's not a rational answer, by definition, since it wasn't made with logic or reason.
Let’s replay this.
You: how would you even value SpaceX?
Me: Some multiple of their last funding round
You: You’re irrational. They made money last year.
What?
Do you think earning a profit makes your company uncountably valuable? Or earning a profit and adding some promises on top? Neither is true!
These aren’t real problems in any scenario and certainly not in the scenario of “hello the United States of America is seizing your company, here’s a check we think is fair.”
I responded to what you actually wrote in your previous comment:
> Some multiple on the last funding round (perhaps a multiple <1)
The irrational part is that it could possibly be a fraction of their last round of funding. Do you agree it would have to be a multiple much greater than 1, since their last round of funding (750 million) was a small fraction of their profit last year, and they are on the path of exceeding their total accumulated funding for all rounds in another two years?
I've never seen a profiting company valued based on their last round of funding rather than current/future revenue/profits. Do you have any examples of this, in the real world?
No, it wouldn’t have to be. Perhaps it would be, perhaps it wouldn’t be, as I said.
https://news.ycombinator.com/item?id=43520384
Again, do you have an example of the current value of a company, with similar circumstances, being based on the last round of funding?
The Mars colonization thing is worth so little that it’d eclipse everything else and make the company worth negative dollars, if he ever really puts them all in on it. It’s pure fantasy. Mars sucks. It sucks very, very, very much. It sucks more than a nuclear-holocausted Earth that’s also had a decent size (but not crust-liquefying) impact and an insanely bad climate disaster, at once. It’s an awful place.
> it’d eclipse everything else and make the company worth negative dollars
I'm not sure I understand this. SpaceX would potentially profit from any transport services provided. Why would others paying for the missions reduce the worth of SpaceX? Or are you suggesting SpaceX would be the one funding it all?
I know that they claim their long term plan is Mars colonization and asteroid mining, but frankly I think those are lies.
It cost the Diablo cheater nothing to simply lie about this, they have no concrete plans on how to get to Mars or establish a colony, they still can't even get to the moon, with the deadlines being pushed back years at a time and getting increasingly more convoluted.
I'd be happy enough to be wrong, if we can get people on Mars in our lifetime that would be pretty cool, but Elon lies and embellishes nearly everything, and there's basically no consequence to lying or embellishing "plans" to colonize Mars.
This is correct, but there are plenty of Tesla dealerships to protest outside and cars for people to remember they don't like him. People could protest outside a SpaceX facility but it's unlikely they would garner any attention by doing so.
My quick search is showing Tesla is worth some $800B. 15% of that is real money.
15% of that is paper money, heavily levered against. If he tries to sell even 2% of that in order to turn it into actual real money, the remaining 13% will be worth less, because a sell-off will lower the stock price.
Of course, just selling a single stock will lower the price of other stocks. But the dropoff is nowhere close to what you are implying. He has sold lots of stock over the years and somehow Tesla stock price didn't drop that much.
I feel like you used 'worth less' to imply 'worthless'. But this is far from the case, 13% would still be a gigantic pile of 'money'.
His 15% of Tesla is heavily borrowed against, and if Tesla's share price drops too far, he's gonna get margin calls. That will both destroy his wealth, and hurt Tesla's stock price even more.
SpaceX is worth less than 10% of what Tesla is valued at, so 15% is still a larger holding and very much "where it hurts". You should consider pausing before calling the popular position drivel.
Is he really rich? He started a car company, one that is known to make shit cars. All of their big bets failed. So what was supposed to be "not just a car comoany", which is what all the insane valuations were based on, is now "just a car comoany" and a shit one at that. So why is this car comoany still valuated at such insane hype levels? Is his wealth not entirely tied to the hyper-valuation of this car company?
> He started a car company, one that is known to make shit cars.
No he didn't. He was an early investor in a car company, eight month after it was founded, and later history-revised his way into a founder title.
Not that this should be surprising, considering the childish ego on that man.
You're right. This is always something I've pointed out myself. Just got sloppy with language here.
Except for the Cybertruck the cars are pretty good. The overvaluation is because Musk wants everybody to think Tesla is an AI company that makes self-driving cars, which by now everybody realizes is bullshit.
Tesla makes pretty nice cars if you're willing to drive them yourself and you only occasionally use autopilot as a kind of smarter cruise control. Never use FSD unless you're willing to pay through the nose for a system that only works in select locations and otherwise tries to kill you every few minutes.
Is spelling "company" really that hard?
It's probably just a typo, O is next to P on keyboards, mistakes happen.
I just borrowed a hundred trillion dollars from myself, then paid it back instantly. This means the majority of 2025 US GDP is now my financial activity, right? Seems newsworthy.
Trivia: Simple interest on $100T borrowed at 6% for 10 seconds is $1,900,000.
All money is made up. The banks literally "lend" money into existence without having it backed by anything, the banks don't need to have the money in the first place, the bank reserve requirement has been dropped to 0% in 2020.
It’s true that all money is made up, but not in the same sense OP means.
Like I could give you 20 dollars and it’s made up in a sense, it’s just a piece of paper, but also you can go to the store and buy things with it.
Whereas if you’re an investor in a company and the CEO does some self dealing which nominally values your shares at 20 million, you can’t go spend that. It’s even more made up
Or, an (over)simplified way to put it:
"All money is made up, but some are more made up than others."
The value of Twitter was set when the bonds used to finance the purchase were sold recently for 97cents on the dollar.
Musk threw in xAI ownership to sell those bonds, which themselves have an 11% rate. Musk basically backstopped the bonds by giving a heads up of this.
No, that was absolute fantasy numbers, and in no universe did it verify any value of Twitter.
Musk really, really knows how to play people. He deserves that credit.
And I mean, bond discounts or not have nothing to do with the value of a company. The discount on a bond is based upon the likelihood they'll ever be paid off, and after it was clear that Musk would save the failure of X by using one of his other companies and AI hype to do so (as others have said, just like SolarCity), the bond lost its discount. X's value could be $1, but if the bonds are going to be repaid they'll sell at no discount.
?
When debt is worth near par that only means that equity is very likely positive (not null). Doesn't tell you anything about how positive.
Small correction.
When xAI was founded, the X investors got 25% of xAI.
So he didn’t sell for less than he paid for it.
https://www.hindustantimes.com/business/investors-who-backed...
But all the armchair business experts assured me that the value of Twitter had completely tanked since Elon bought it because he’s such a stupid fool who ruins everything, so shouldn’t it be worth less? Just a few months ago everyone was confident it was only worth $8 billion.
He valued it at the same price minus debt.
He bought it with stock from another company that has no clear value and is a meaningless hype monster. What is xai going to do that 10 other AI companies aren't going to build, anthropic, openai, etc.
Theoretically the synergy with Twitter could be fantastic in terms of potential value added, if I’m trying to be down to earth. The others have no real foothold in the real world beyond their own services, and users may flock away as AI integrated into their favorite apps etc. become good enough.
You might want to read about a little company called Meta, who possess the same advantage, but larger.
What synergy exactly? Selling Twitter bots?
The sibling examples where good as well, but I think missing a major one: Consumer access. xAI can just merge their chat bot into the X/Twitter app, and suddenly they have a couple hundred million users on this thing. In a commoditised market, distribution is everything.
Also seems to fit with Musk's vision of turning Twitter into some kind of US WeChat, an app people do a bunch of stuff in. Using LLMs to do a bunch of stuff seems to be the way the hype is going right now.
I don't know if I see long term value here, but I can't say I don't see the story.
You can’t think of a single synergistic thing? Seriously?
Automating some administrative tasks? Gauging sentiment across swathes of the population on a given topic? Providing stuff like the “reader context” but attempt to pre-empt it so better info is shared to begin with? And yeah, probably lots of Twitter bots for different things. Provide automated customer support for companies on there, or help people find products relevant to what they’re discussing/browsing etc.
There are literally a million options; I find it hard to believe you couldn’t think of one
Sir or madam, if you are defending the value of xai then I think it's incumbent on you to suggest the synergistic or other value creating aspects of xai, when other people are doubting it. Many other of these types of systems are doing these same things like creating software to do administrative tasks, summarizing the gist of an article or a series of comments. Those are the most basic things that all of the other systems are doing also.
It’s not my job to think for you, it’s your job to do that. He asked a really low-quality question. It’s like when the fresh-grad dev tells you he can’t figure out his ticket.
…okay? Did you read it? Was there enough info? Where did you get confused? I’m happy to provide clarification, but if he stopped so quickly he couldn’t think of a single way that a social media platform could leverage in-house AI (or vice-versa) and the power that would come from (still, somehow) being one of the foremost social media sites on the planet, then it’s not the time to ask questions, it’s the time to think a bit more.
> automating some administrative tasks?
on x? like... for marketers? do we really need ai to schedule tweets or auto-reply with “thanks for the follow”? feels like we’ve had that stuff for a decade already. just because it’s ai now doesn’t make it new or useful.
> gauging sentiment across swathes of the population on a given topic?
you mean gauging sentiment from a user base that’s gotten increasingly loud, extreme, and way less representative of the general public? that’s not insight, that’s just noise with extra steps.
> providing stuff like the “reader context” but attempt to pre-empt it so better info is shared to begin with?
in theory, sure. but that’s assuming the platform actually cares about curating good info and not just maximizing engagement. reader context is cool when it works, but it’s super inconsistent and often buried. ai preemptively “fixing” info sounds nice until you remember who’s training it and what incentives are driving it.
> twitter bots for different things / automated customer support / product recommendations etc.
yeah i mean, bots have been a thing on twitter forever—some useful, most annoying. ai-powered ones could be better, but the platform’s current vibe isn’t exactly welcoming for brands trying to do legit support or sales. good luck pitching your socks in a thread full of people arguing about conspiracy theories.
What are OpenAI, anthropic, going to do that xAI isn’t? By that logic if there is more than one company in any field they’re all worthless.
I've got a water bottle, I'm going to sell it to myself for $1 billion dollars.
I now own a $1 billion dollar water bottle
The value of something only matters if there's a market for it, and people can bid on it. Musk just made up a number he liked and said it out loud.
He valued it as the price he made another company value it.
Do you understand where money comes from, cause Elon and you seem to not understand.
How much of these evaluation is based on Musk‘s influence on Trump?
Newspeak phrase of the day: Conglomerate Discount.
Some inverters believe they suffer from "conglomerate discount" [1]: that their whole conglomerate can be worth less than the sum of its parts. Who decides what the parts are worth? The investors, of course. Buying shares of their own company is a pretty standard way to fix the "discount".
[1]: https://en.wikipedia.org/wiki/Conglomerate_discount
Buying your own assets is a well-known get-even-richer scheme of the rich.
I think it's the same move Adam Newman invented. Great minds think alike, I guess.
you might want to check who owns majority of FAANG stocks. once you identified those, check how much they own of each others. Musk is just doing what everyone else does
I'll do you one better. The Market Makers are Vanguard, Blackrock and State Street which are majority shareholders of 80% of the SP500. They control the price using swarms of HFT bots, most likely running Blackrock's Aladdin algo which they license. The largest shareholder of Blackrock, is Vanguard.
It’s actually more, right? Because it’s $33b+$12b of debt, which means he’s saying it’s worth $45b.
go go gadget FIAT dollars
Welcome to the real world of finance. Hollywood accounting is taking over the globe, and they need to control the government to do so.
Musky, tell me 5 things you did today at school.
Well, I invented a new name, sold it to myself and now people say I’m worth more money.
Anything productive, Musky?
No. Nothing else.
You're fired Musky!
> Wild
It's not wild, it's - if there is malfeasance - unprosecutable.
And then will leverage against that valuation for loans, acquisitions, etc.
Self dealing. Nobody cares anymore.
It's all private capital. The only people who are exposed to this deal are the banks who make loans to Musk and Twitter, and the investors who put capital in to take Twitter private or to invest in xAI. If one of those entities is mad they will sue, and the legal system works pretty well for fights between different capital holders. Doesn't really matter what the general public's opinion is.
Trump pardoned Trevor Milton today, who scammed investors out of millions doing things like his now infamous "rolling a truck down a hill to make it looks functional" demo.
Milton donated $1.8M to Trump, and Miltons lawyer's sister is Pam Bondi, the Attorney General.
This is nakedly corrupt and a strong signal that you can get away with all manner of financial fuckery if you are on Trumps "good list".
Every democratic country deserves the government they get.
Good and hard.
At least we don't have to worry about trans kids swimming on the girls swim team.
/s
>Please don't use Hacker News for political or ideological battle. It tramples curiosity.
Comments like these are wildly off the original topic and practically invite the dead replies. As a rule of thumb, if you're about to put "/s" at the bottom of a post on an even remotely political topic, please reconsider. Especially if your sarcasm is already quite obvious, and obviously being used to bash a political outgroup.
And now there's this: https://news.ycombinator.com/item?id=43509169
Is it corruption if it's done publicly and no one gives a fuck? ¯\\_(ツ)_/¯
Absolutely..and people care.
"But that guy George Soros surely is up to no good!"
It's probably being spoken by some podcast that helped get Trump elected.
When they have an actual conspiracy, with actual billionaires paying the president and getting full access to the government, while getting public contracts... all of this being live streamed... they're still stuck in George Soros and the Deep State lizard people fantasy.
It's the new normal
https://apnews.com/article/nikola-trevor-milton-fraud-trump-...
Musk gets away with a lot because he does deliver sometimes - the cars and the rockets have done well. The investors and lenders are not totally dumb.
Would anyone say the same about Cathie Wood? Also, Starship "done well?"
Good luck trying to get a bank to underwrite that loan, smells a bit risky.
"Nice bank you've got there. Would be a shame if ________" (Insert any number of orders that Musk can have his friends in the executive branch issue to make life miserable for the bank principals.)
It's good to be the king. Even better to own him.
That makes me think of Jakob Fugger. He was so rich the pope borrowed money from him to build St. Peter's Basilica. And they got so desperate to pay it back they started selling indulgences, pissing off one Martin Luther and creating Protestantism: https://theconversation.com/the-man-who-gave-us-the-reformat...
And that makes me think of the Knights Templar. They were so rich that everybody borrowed money from them. The one day, the King of France decided he didn't want to repay the loan. The story doesn't end well for the Templars.
Case in point: https://apnews.com/article/trump-law-firm-mueller-fc64fcda09...
> A prominent international law firm reached a deal with President Donald Trump on Friday to dedicate at least $100 million in free legal services and to review its hiring practices, averting a punishing executive order like the ones directed at nearly a half-dozen other major legal institutions in recent weeks.
This isn't theoretical. It's happening.
Wow, I thought the sum was $40 million, but that's what the other law firm paid that showed a lack of principles and caved...
And another law firm is being blackmailed because it used to employ someone who worked for Robert Mueller (of the Trump-Russia collusion investigation)... Geez Trump's team is actually busy, but busy settling old scores.
They’re busy making sure the firms with the money and bench to try to fight the authoritarian take-over in court are all sidelined.
Exactly, that was the case I had in mind.
Then he buys the bank. DOGE is in the SEC now. Elon Musk is the regulator. If he decides that a bank is doing “fraud” and wants to shut it down, is there anyone to stop him? Serious question.
You realize the current administration is shutting down law firms that criticize Trump, right? They'll have zero problems going "do this deal if you know what's good for you".
What an absolute scammer lol.
Welcome to very-late-stage capitalism.
And if you can get the right people to believe in the arbitrarily large numbers you invented out of thin air you can get away with just about anything because the wealthy don't have any real consequences.
Capitalism will fall in 2 more weeks comrade, trust the plan
> very-late-stage
The cope is alive and well.
"aaaany time now it will all fall apart"
> So he just sold himself a company he already owns for a valuation that he himself assigned to that company but that was less than what he paid for it, and he paid entirely using “money” that has a made up value and which he issues himself?
And that is for sure either illegal or immoral. /s
> valuation that he himself assigned to that company but that was less than what he paid for it
It’s more than he paid. There’s 12 billion of debt you’re not accounting for.
Its almost like modern life is riddled with lies, liars, and their collective bullshit.
I don’t think this is a change in the human condition; we’re extremely greedy hairless apes. But guys like Elon really show how low we can go.
speak for yourself. I have plenty of hair!
but what I really wanted to say (because I'm a special interests person)
is that hair is a mammal trait. all mammals have hair!!! how cool is that?
TIL dolphins are born with hair
I argue that he's literally showing us how high we can go with SpaceX.
With SpaceX? Or Ketamine??
I think you’re showing us how low someone can go alright.
I'm sorry, but calling out someone visible and public substance abuse problem isn't low. As someone who has dealt with addiction and its fallout since I was a very small child, I can emphatically say the man needs help first and foremost.
But, as the wealthiest man on the planet he's more likely to just be given what he wants: more self-indulgence. When you surround yourself with yes-men and sycophants, actual help isn't likely.
Further, it's entirely right to call this out when his actions impact the rest of the world greatly and the man has obvious problems. To then try and turn it around on me as if I'd done something wrong by pointing out the Emperor has no clothes? Well, I could offer you some choice words, but I'll hold my tongue. However, in my estimation, you could do with some self-reflection and probably a bit less "taste of boot on your tongue".
In what way though? I’ve yet to see anything that rivals any accomplishments by NASA. Or were you being punny?
Did you not watch them land the starship? That's easily the biggest space-faring accomplishment since Apollo, and certainly not something NASA could replicate in the foreseeable future.
Speaking of the moon, NASA's SLS is projected to cost several orders of magnitude more than a super heavy launch, and is only aiming for the moon as opposed to Mars.
If there's one place that Doge could really, actually stop a lot of waste and fraud, it's at NASA. Of course, that would be the conflict of interest par excellence, and face a bunch of opposition from red-state congressmen with huge contracts in their constituencies. Objectively speaking, though, it's a huge waste of taxpayer money.
> If there's one place that Doge could really, actually stop a lot of waste and fraud, it's at NASA.
At 0.3% of the federal budget - if NASA was 100% waste, fixing it wouldn’t make a dent.
NASA/DoD did lay some of the groundwork. DC-X was a vertical landing rocket meant for reuse nearly 35 years ago. Granted SpaceX has done amazing things that are more difficult (DC-X was suborbital), but I tend to think if NASA continued they would have got there. From my perspective, SpaceX’s major benefit is they don’t have to follow the same rules as NASA so they can do things quicker and/or cheaper.
The “waste” is really just a different risk tolerance. You could make many of the NASA requirements go away, but nobody wants to be the one who signs up for that when the next disaster happens.
The waste does not at all stem only from different risk tolerances. SpaceX launches NASA astronauts which means that they also need to comply to the same standards. Pork barrel projects like SLS is the real reason why everything NASA does is so expensive and late.
The statement that NASA would have achieved reuse eventually is weird considering that NASA still exists today, 35 years later, without succeeding.
>SpaceX launches NASA astronauts which means that they also need to comply to the same standards
Sorry, this is false. When NASA engineers have raised the question of non-adherence to NASA standards by CCP contractors, they were told it wasn’t their role to dictate those kinds of requirements. You can see this in a number of mishaps, like when a strut failure resulted in a lost rocket because they didn’t want to follow well-established and codified aerospace supply chain quality standards. NASA is buying a service with CCP, not a product. This says nothing of the political requirements NASA must work through that contractors do not.
>The statement that NASA would have achieved reuse eventually is weird considering that NASA still exists today, 35 years later, without succeeding.
NASA does, but that NASA VTOL rocket program was cancelled in 1996. My point was that the tech was feasible for NASA, but not a priority.
Does Falcon 9 fail more often than other rockets?
NASA spending 35 years pursuing pork projects instead of useful technologies like VTOL sounds like the very definition of waste to me.
I agree Falcon 9 is showing itself to be reliable and low cost. We probably agree about the pork piece too
You’re missing the point (which seems to be a common thread on this) so before I spend too much time constantly reiterating: 1) What do you think is the goal of NASA and 2) What do you think is fundamentally different about CCP?
Isn't the point actually "SpaceX, owned by Elon Musk, has accomplished some amazing feats in the aerospace industry?"
No, the point was about the differences in risk that facilitate that works. I agree that SpaceX has done wonderful things, but disagree about the overly simplification.
For example, the commenter uses the word “waste”, probably because they lack a nuanced understanding. NASA operates under different risk constraints than SpaceX. For example, they have to manage political risk which is why centers are spread across politically important states; that prevents funding from drying up. When a project is managed across different geographic locations, it creates funding stability at the cost of inefficiency. SpaceX doesn’t have the same problem, so they can skirt many risk reduction requirements, as well as consolidate operations to maximize efficiency. From that standpoint, both sides of the public/private partnership have unique roles. But people tend to want to color one as good and the other as bad because it fits easily into simple (but incorrect) mental models.
There are other differences in risk, but I’m already tired of typing.
Like most things, when people have an overly simple or dichotomous take of a complex issue, it usually belies an incomplete understanding. The OP started off with a claim that showed they don’t understand how the CCP works, and just kept digging.
No, you're right. NASA has already shown that we can go past our solar system, so... His company has done some really awesome stuff with the ships/rockets, though.
This move makes it more likely that the internal number for TSLA is not good, and Elon is expecting the price to go down.
He has access to the real revenue number. If it's going well, he wouldn't have to perform this maneuver. xAI was relatively separated from X and TSLA, and wasn't having the backlashes associated with the two. Now he risks having the xAI branding tarnished too. He wouldn't do this unless the TSLA internal numbers are bad and he has to protect himself first, at the cost of xAI brand.
> more likely that the internal number for TSLA is not good
The external number for TSLA is not doing very good either
Still higher than just 1 year ago. Still vastly overpriced.
To put it in perspective, over the past 6 months TSLA has performed as well as META and much better than GOOG and MSFT.
That's true, and in the last two months it's done worse than all of those put together!
Yes I guess if you bought TSLA two months ago you're hurting. If you bought it 6 months ago you're doing better than the S&P 500.
even despite the white house showroom ad, no less
It's interesting in conjunction with the SEC/DOGE move.
For ever, companies wanted to cook their own profitability metrics - see the famous (pre-Musk) Twitter revenue per click or something, or adjusted by size of community.
Public company disclosure rules, however, dictate fairly strictly what is and isn't revenue, profit, capital and so on. Right now, you can publish any wacky statistics you like, so long as you also provide the GAAP ones - "generally accepted accounting practice".
But who knows, perhaps DOGE in SEC relaxes that, giving companies more scope to hide bits of their business they don't like.
xAI was seperated from X in what sense? xAI employees were X employees [1]. X reportedly had a stake in xAI, although The Verge says that hasn't materialized yet [0]. xAI's primary UI was X.
(This is primarily around your backlash comments, I'm sure some shareholder malarkey could make them technically separate).
[0]: https://www.theverge.com/news/638933/elon-musk-x-xai-acquisi...
[1]: https://www.theverge.com/2025/1/10/24339249/elon-musk-xai-x-...
I don't understand the relation with TSLA.
There's a margin on TSLA stock at $112 or $115; Like some other commentator said as well - he collateralled TSLA stock to take a loan to buy Twitter.
I’m not an expert in this but as far as I can tell there will never be a margin call. There’s only a margin call if he defaulted on his loans. All the banks will do is ask to restructure the loan to compensate for the loss in the collateral.
Further, it’s just $6bn which musk can easily cover.
> The funding included $7 billion of senior secured bank loans; $6 billion in subordinated debt; $6.25 billion in bank loans to Musk personally, secured by $62.5 billion of his Tesla stock; $20 billion in cash equity from Musk, to be provided by sales of Tesla stock and other assets; and $7.1 billion in equity from 19 independent investors.
https://en.wikipedia.org/wiki/Acquisition_of_Twitter_by_Elon...
What happens if you collateral a stock for loan and the stock somehow becomes worthless?
Same thing that happens if you put up any kind of collateral that later becomes worthless: the lender doesn't get their money. That's the risk of collateral.
This is why mortgage lenders require you to maintain insurance on your property: if the house burns down or something, the lender still wants that money. If a house gets destroyed in a way that's not covered by insurance (say, by an earthquake in California, where most people don't have earthquake insurance), then the lender loses their money. (The former homeowner probably stops payments and gets their credit ruined.)
his margin call level is not public right?
> his margin call level is not public right?
But you do know “things” have a way to find path to get in public :-). Also, as stated in the following article, Tesla filed with SEC how much of stock was used and you can use the timing to find the stock price during the period of acquisition.
https://www.newsweek.com/elon-musk-facing-margin-call-tesla-...
Musk leveraged TSLA stock to buy Twitter.
Elon sold 19B in stock, took a loan for 6.25B, and the rest was other investors.
The 6.25B loan, assuming he still has it, is really not an issue considering his net worth. He can add more collateral or sell a bit. In fact TSLA stock is higher now than when he bought Twitter.
"Net Worth" can be misleading.
Wikipedia say Musk has repeatedly described himself as "cash poor" -- most of his worth are not in cash.
How much of his net worth are in $TSLA?
It sounds more like a way to save whats left of X, and leave xAI investors holding the $12B bag of debt that X is struggling to service.
This is my feeling too. Good chance of a margin call coming for all his loans backed with TESLA shares
This doesn’t seem like a branding related deal, it seems like wanting to further marry their operations for strategic reasons.
I don’t see how this is anything other than financial engineering to protect Musk’s personal wealth
What was stopping him doing that before? He owned both companies.
None of this is really related to TSLA.
> xAI was relatively separated from X and TSLA, and wasn't having the backlashes associated with the two.
I don't understand this point: why would these backlashes care about the on-paper separation? (I'm assuming by backlash, you mean that of public opinion, which already knows about the xAI-Musk association).
This sounds as tinfoily a take as I've heard here. TSLA is not related to this in any way.
The purchase of Twitter was leveraged using TSLA stock.
Seems to me he's just scammed xAI investors, who thought they were investing in an AI company, into bailing him out of his failed Twitter purchase - they are now the idiots who paid $44B for Twitter (recently valued by Fidelity at $10B), and Musk gets his money back.
I think xAI investors were enthusiastically buying a ticket on the Elon rollercoaster
These xAI investors are not regular paycheck people. If they aren’t happy, this deal would not have happened. If they lose money, who cares.
“Musk did not ask investors for approval but told them that the two companies had been collaborating closely and the integration would drive deeper integration with Grok.”
https://www.theguardian.com/technology/2025/mar/29/elon-musk...
Unlike the shareholders of a company being acquired, the shareholders of an acquiring company do not need to be asked prior to the company making an acquisition.
can you cite your source? What leverage did Elon give the investors when he sold them shares?
No source, just speculation. I think my main point is that these aren’t regular people that we need to feel sorry for or rise up in arms to defend.
You can be against fraud in general without feeling sympathy for the particular victims. I know I am.
Why assume fraud?
Usually a safe assumption with Musk. I believe his kind call it "pattern recognition."
IANAL, but this might be brought to court, if the company mission (as defined in their operating agreement) is to invest in AI, then buying X is not in the best interest of the company and not what the investors signed up for. It could be fraud.
Am a lawyer, this is an incredibly silly and unlikely thing to suggest for a for-profit company set up on behalf of an even mildly sophisticated party in the USA.
Nearly ever such company is "limited" to engage "in any lawful activity" so as avoid exactly this issue.
Every AI company is buying access to data sets or sources of data.
So your justification rests on the theories that a) Musk (Twitter) was denying Twitter data access to Musk (xAI), and b) Twitter data - a firehose of ill-informed flamewars and bot responses - would provide some incremental benefit to training a frontier model.
A) considering the deals with Reddit and other content sources are paid it might not look wise to give it to a company you own for no consideration
B) I never said it was a good idea or anything. Just proposing what thought process happened.
What is iAnal? Does it mean what I think it means?
IANAL stands for "I am not a lawyer"
This reminded me of this one time my father used the term "annales" which in french apparently means "past exams" or something :P
Sorry to disappoint you, but it means "I am not a lawyer"
Then there must be a UANAL
Being actively not a lawyer.
I thought I also heard that the people who agreed to buy Twitter's debt got the deal sweetened with some XAi stock.
Sooo, did that debt get paid off, and they got XAi stock. If so, buying that Tesla debt might not have been the complete bloodbath it should have been.
Is there currently a better use of the money? They can’t just double their GPU count.
Fidelity valuing at $10B is ancient outdated news no longer reflective of reality, the value had skyrocketed in recent months, given the profits which now exceed profits as a public company. [1] [2]
In fact, Twitter debt is selling at 97% of value, indicating high confidence in the company. [3]
[1] https://www.theguardian.com/technology/2025/mar/19/value-elo...
[2] https://finance.yahoo.com/news/elon-musk-paid-high-price-114...
[3] https://finance.yahoo.com/news/musks-value-on-wall-street-is...
> Twitter debt is selling at 97% of value, indicating high confidence in the company
I helped some friends buy this debt. It has nothing to do with Twitter’s strength as an enterprise, but Musk’s brand as a political one. There is a great book on 90s Russia before Putin took power—the pre-Berezovsky playbook looks like the way to go in America right now.
Okay, I know Tesla's extremely high P/E ratio is because it's worth is not just tied to cars, and so xAI priced at $20B more than Anthropic does not necessarily mean xAI's AI products are that much better than Anthropic's (e.g. presumably xAI's worth is tied to synergies with Tesla FSD, Optimus, and maybe even Neurolink)...but what products does xAI actually offer, other than Grok being an add-on for premium X subscriptions?
Not only does the Grok API not have access to Grok 3, which was released more than a month ago, it doesn't even have it's own SDK? [0]
> Some of Grok users might have migrated from other LLM providers. xAI API is designed to be compatible with both OpenAI and Anthropic SDKs, except certain capabilities not offered by respective SDK. If you can use either SDKs, we recommend using OpenAI SDK for better stability.
(every code example has a call for `from openai import OpenAI`)
How would using Grok be viable for any enterprise? And if Grok's API is designed to be drop-in replacement for OpenAI's, how are they not able to just use Grok to whip up their own SDK variant based on OpenAI's open-sourced SDK [1] and API spec?
[0] https://docs.x.ai/docs/guides/migration
[1] https://github.com/openai/openai-python
For anyone not in LLM field, OpenAI API is the de facto standard for almost all AI companies and labs nowadays.
DeepSeek docs just point users to use OpenAI SDK: https://api-docs.deepseek.com/
Anthropic recently did some something similar: https://docs.anthropic.com/en/api/openai-sdk
It's not because it's any better -- it's because they were first. Others assume the same schema for easy interop.
Not a fan of Grok by any means but an SDK isn't that much of a requirement. We use liteLLM as it gets really annoying to roll your own router when you have so many viable providers with various specialties.
Grok is also a stand-alone product with an optional $30/month subscription. Perhaps they are seeing a huge increase in usage here and are hoping that subscriptions follow.
As others have said, the openai sdk is the defacto baseline sdk everyone uses. Like how every object store is compatible with S3.
The OpenAI library is used pretty much everywhere in the LLM world, every serious AI provider has an OpenAI-compatible API, or you can use something like OpenRouter which is also OpenAI-compatible. Standardization is good.
What is the play here? Using money invested in xAI and its inflated valuation to bail out the X investors?
It bails out Elon and means his Tesla shares (borrowed against to purchase Twitter) won’t be liquidated as Tesla’s share price continues to decline, using xAI investor funds. He uses hype and sentiment (inflating valuations) in the capital markets to always stay slightly ahead of consequences.
Tesla shares are higher now than they were when he closed on Twitter in October 2022.
And dropping. No one can tell the future; it might recover before it hits margin-call territory, and it might not.
The company is imploding. BYD is eating their lunch on most real metrics except their absurd valuation.
Maybe he knows something.
Heck, TSLA today is higher than on 5 November 2024, less than five months ago!
But lower than on 6 November 2024, less than five months ago.
It's up 49% YOY https://www.google.com/finance/quote/TSLA:NASDAQ?window=1Y
This is a bit of a silly game, their stock is very meme-y so whenever you set the start of the time range the aggregate % can vary heavily.
And it's ~40% lower since the "roman" salute day. Anyone can pick random dates.
It is almost the same price.
Sure, but it's becoming increasingly obvious to everyone that the American car industry is in major trouble. In a decade, I'm confident in saying a lot of American car companies will not exist.
We see it in our day-to-day lives. People aren't buying new cars. Cars on the road are getting older and older. Views of Tesla continue to dwindle. Anything Stellantis is on life support. I mean, Chrysler has literally one car. GM is clawing for any sort of relevancy. And Ford is only afloat because of toxic masculinity. We all know that it's bad in the US, and we know outside of the US it's 100x times worse for these companies. We also know the US car market as a market is getting overshadowed.
It doesn't matter what stupid investors think. We can see the writing on the wall. These investors are delusional, period.
Tesla shares are higher than when Twitter was acquired. 'Continues to decline' sounds like weasel wording that the media likes to use to push a narrative that doesn't exist.
Edit: Comment flagged for pointing out inconvenient facts, it's wild out there
It is not unreasonable to assume Tesla shares will continue to decline whilst:
a) sales internationally are plummeting at such a rapid pace
b) consumer confidence is down with predictions of a looming recession
c) the brand continues to be tarnished by the association with Musk and Trump
d) auto tariffs will increase the costs of parts and the likelihood of reciprocity
You forgot to mention that China, Vietnam, Thailand, and Indonesia are all betting big on EV production. China is of course the main competition, but it's telling just how stiff the competition is getting across the board. BYD is currently making more cars than Tesla, with more advanced battery technology and comparable build quality, for a fraction of the price of any Tesla.
Meanwhile Elon is too busy rage-tweeting and K-holing to work on any of the things Tesla promised it would do this year, like release a model 2 or something with robots
The auto tariffs are a present for Elon. Teslas are the most American of American cars, and while they do still use foreign parts they use the least out of everyone.
On top of that, in the EV category, Tesla is pretty much the only one made in the US.
Tesla made 50% of its revenue in the US in 2024. It's a global company. Trade wars will not be the massive boon Tesla investors are hoping for.
Remember that their current P/E ratio is ~134, so the stock price already has a ton of growth priced in.
https://rivian.com/
https://www.axios.com/2025/03/27/trump-auto-tariffs-vehicles...
Why would they continue to decline? If all that information is already known, why isn't it priced in and why isn't the best estimate of Tesla's price in 6 months equal to today's price plus the return of Treasuries?
Tesla's current P/E ratio is 134. To be a rational Tesla investor, you'd have to think it has almost 600% profit growth potential to reach the long-term American blue-chip average P/E of ~20.
That kind of growth would be difficult for a new entrant, but for an incumbent that's been around a while and already seeing sales decline, it's a pipe dream. Of course, it's not all about cars for Tesla. They're betting big on humanoid robots and "full self-driving", although they've been stuck at Level-2 self-driving for years and the robots, well... Let's just say we don't hear much about them for a reason.
Of course, Tesla has never been a company for rational investors. I used to hold a lot of Tesla stock back in 2017-19 when they had plenty of doubters. I remember seeing how Tesla owners would organize themselves grass-roots-style to show off their cars and convince others to go electric. The company was getting a ton of free marketing and had a very devoted customer base. My, how things have changed. Now, they have to shut down showrooms across the country due to "terrorism".
So where is the upside? Well, protectionism could help them in the US market, but they're a global company with stagnant sales in the US, so it's hard to see tariffs helping more than they'd hurt. And that's pretty much it for upside AFAICT.
Happy to hear from a bull that I'm wrong :)
The consequences of the known mismanagement is priced in. The consequences of the unknown mismanagement are tbd.
67% of Americans would not consider buying a Tesla, new poll says - https://electrek.co/2025/03/28/most-americans-would-not-cons... - March 28th, 2025
Tesla (TSLA) Q1 delivery consensus: 377,000 EVs – worst performance in 2 years - https://electrek.co/2025/03/28/tesla-tsla-q1-delivery-consen... - March 28th, 2025
Tesla is banned from Canada EV rebate program, gov freezes suspicous $43 million in rebates - https://electrek.co/2025/03/25/tesla-banned-canada-ev-rebate... - March 25, 2025
Tesla sales fall by 49% in Europe even as the electric vehicle market grows - https://apnews.com/article/tesla-sales-recall-trump-byd-b6f5... - March 25, 2025
Tesla’s fall from grace may have no equal, says JPMorgan: ‘We struggle to think of anything analogous’ [$120 price target] - https://finance.yahoo.com/news/tesla-fall-grace-may-no-18005... - March 13, 2025
Tesla’s stock nosedives — wiping out $700B in gains since Trump’s election victory - https://nypost.com/2025/03/07/business/tesla-stock-drop-eras... - March 7, 2025
Australian Tesla sales plummet as owners rush to distance themselves from Elon Musk - https://www.theguardian.com/technology/2025/mar/06/australia... - March 6th, 2025
https://finance.yahoo.com/quote/TSLA/ (1YR)
Facts you don't like aren't "weasel words."
It's true that Tesla shares recently declined, but the context is important: during 2022-2024 Tesla shares were trading between $100 and $300 (with high volatility), in October 2024 they were at $200-$250, then after elections they skyrocketed to the all time high of $488 (for no fundamental reason), and since then the stock is falling. It's $263 right now - after the latest declines the stock only returned to the price that's still higher than before the elections, and is higher than the 2022-2024 average (which was already unreasonably high and totally disconnected from earnings). So these declines are nothing, at least not yet.
FWIW there was a fundamental reason for shares to spike after the election: The elected regime was one that is very corrupt and self-serving, and was likely to do everything in its power to make money flow towards the companies it owns.
By now, though, it's seeming more like they're too incompetent to do that. They'll probably still do it, but they'll crash the whole economy at the same time so the money that's flowing to Tesla won't be worth a whole lot. But it was a reasonable prediction at the time.
We've only witnessed two months of this. Imagine four years of it.
And the whole market is down, not just TSLA.
ivewonyoung and raynier are still correct. TSLA today is higher than on 5 November 2024, less than five months ago.
That's fine if that is the argument (11/5/2024 vs today) vs all the gains since that period lost, I'm not willing to argue the point to death, the brand value destruction will continue. The fundamentals will catch up to the price eventually with enough pressure.
“Continues to decline” is a cushion for the next sentence “downgrade to sell” which cushions you from the ultimate, “new marketing leadership with Barron Trump and someone named Alien Brainrot”.
I’m pretty sure the management team will include Boris Badenov as the new DPO
If I jump off a building and you see me at the 10th floor, I was also 29.4 meters higher 3 seconds ago.
Tesla sales are falling worldwide and losing market share
The stock is up more than 18% in the last 18 days, so by your analogy you were 29.4 meters lower 3 seconds ago.
Falling from a building isn't the right analogy, it's more like falling down a huge flight of stairs. You bounce on the way down.
After the unprecedented move of the President of the United States anointing Musk as a made man and member of Donalds swamp, all from the White House. In additional multiple other highest members of Trump's government went on TV and said 'invest in Tesla'. That is not a healthy stock surge. It is a pure DC swamp play.
The absolute state of Orange Reddit
What do you mean by this? Do you not agree these events happened in an attempt to bring the stock back up? That government officials gave stock advice on TV that would cost financial advisors their licenses, for the benefit/as a favor to Musk (a billionaire), the very definition of DC swamp behavior, government officials doing illegal/immoral favors for their rich sponsors.
Not to be pedantic, but you’ve confused acceleration with velocity. How far you’ve traveled will depend on how long you’ve been falling, and what your starting velocity was.
And now also uses government capture to dismantle regulatory agencies that would come after him for breaking the law.
Still, you have to give it to him, it works, and this has allowed him to do some incredible things beyond just hype.
What he's pulled off with xAI more recently is really quite incredible. And obviously this isn't first time Elon proved he can execute better almost anyone else.
I don't really have opinions on him as a person, but as a an entrepreneur you cant flaw him imo. He always finds a way to beat the odds.
"He's a terrible human, but look at the model benchmarks!" We're different people I suppose.
>"He's a terrible human, but look at the model benchmarks!"
That's basically the response to deepseek? Aside from a few people pearl clutching about "chinese propaganda" or whatever, most people praised its efficiency and performance on benchmarks. Credit where credit is due. Also note that China is an authoritarian regime where there's no separation between the state and private enterprise. Every company of non-negligible size has a CCP committee inside of it.
Can you qualify the first part? I haven’t met him.
You don't have to meet someone to know they're awful. I've never met Adolf Hitler - but I'm pretty confident he's an awful person.
Elon Musk uses his immense wealth to cheat. He's infiltrated the government and uses his power to directly harm Americans, in order to further enrich himself. In addition, almost everyone who has worked for him has corroborated that he is an awful boss.
He is also prone to dishonesty. When confronted with something that requires accountability, his strategy is to protect his lies with newer lies. FSD, the state of twitter, DOGE, and on and on. He is so dishonest that it's almost always safer to assume he is lying than to give the benefit of the doubt.
But, even on a personal level, he struggles to stay afloat. He has impregnated multiple woman and is practically forming an army of illegitimate children. Those who were close to him either speak of him with extreme disdain or not at all. The only child he has any connection to is used as nothing more than a political pawn.
The only reason anyone even thinks he might be okay is because he's rich. We tend to have an extreme bias in favor of the wealthy, almost akin to a brainwashing. The reality is being rich does not correlate with being moral or decent. It doesn't correlate with being intelligent either, but that's a separate conversation.
> What he's pulled off with xAI more recently is really quite incredible.
I genuinely have no idea what he's done that's incredible. I don't even know what xAI does apart from being a chatbot inside of twitter.
Grok was doing well on the LLM leaderboards (https://lmarena.ai/?leaderboard), until dethroned very recently by the latest ChatGPT and Gemini.
I know I'm late to reply, but to explain since many people seemed to be confused by what I said –– I think the speed at which xAI has caught up with the competition from nothing is quite impressive, and the lengths they had to go to to do this, even more so.
Grok is now competitive with the other big players in the foundation model space. To do this they had to recruit some of the top AI talent, speed run the building of massive AI data centers and of course execute well to bring it all together.
All of their competition have either had a time and/or financial advantage over xAI so it's quite impressive what they've managed to achieve given this. Deepseek's achievement in this sense is more impressive so I'm not delusional, but I was still very surprised to see how good Grok 2 was.
I think you are mixing up Grok with DeepSeek. Grok managed to make a mediocre model using way more resources. xAI has nothing.
> What he's pulled off with xAI more recently is really quite incredible.
What?
That and the data that is a part of X can be used by the xAI team. I expect it will be in the TOS if it isn't there already.
"xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent."
Weren't they already doing that? I recall before I bailed from X/Twitter they already added an AI training consent toggle, which silently defaulted to "I consent" for all existing users of course.
> I recall before I bailed from X/Twitter they already added an AI training consent toggle, which silently defaulted to "I consent" for all existing users of course.
There's a solution for that: build a Twitter bot that posts strange things.
Are the porn bots still around? Maybe they were the heroes we needed after all.
There is a setting (opt-out outside of EU, opt-in inside EU I think) that allows/forbids data sharing with X since Grok was released.
Oh yes, you can definitely be reassured that Elon and his openai dropouts working at xAI will follow that one to the tee.
I don’t really see how X data, being riddled with spam and bots, is all that uniquely useful to an AI company. Even if it was, it’s not all that clear that access to data is a defensible moat.
I suppose xAI could already use the data from X, but anyway. X is a cesspool of vile hate and bots. Why would you want to train a AI on that?
I think any LLM that’s not trained on X data comes out ahead.
Why does that warrant an acquisition?
It doesn't actually looks like another financial shifting chairs on the deck due to the xAI valuation being extremely high.
To me it appears to be a way to pay his lenders without liquidating or collateralizing more Tesla stock.
So he can use the funds he raised for xAI to pay out the lenders for the initial Twitter purchase? Otherwise the lenders are just getting xAI stock (all stock deal) which I assume is illiquid?
A stock ponzi scheme to keep him afloat? Soon he will start a new venture and use that venture to save the previous venture and so on. Maybe a robot clothing company because robots shouldn't be naked.
Next step is have SpaceX buy xai
this here is the most logical step
The debt goes to the merged company and so can be serviced or retired using the funds of the whole company.
Seems like anyone who has three "shares" of X now has 1 share of xAI+X, which by Musk's valuation is three times as valuable as X. Assuming the xAI share price is wildly inflated, it seems that the inflated valuation has devalued their actual holdings.
Eg, for an extreme example, if xAI is worth zero, their actual holdings are now a third of what they were.
Yes. He did it with Solarcity already.
Solar roofs was one of many scams.
And he scammed the taxpayers of New York State for a billion dollar factory to build solar roofs. Factory built, stock was pumped, no solar roofs though.
The puffery about waste and fraud is pure projection coming from a scammer like Musk.
Who also talks like Sam Altman that the human race will need to all be on welfare (Universal Basic Income) because of AI.
I don't understand it all ...cut people's jobs who make multitudes of billions less (cut 25k probationary employees like ripping off a band-aid), want people to work like the Chinese do (day and night) so we are the leader in AI (?) and after AI starts replacing jobs we all need to be on a welfare system. Isn't a welfare system the biggest waste to the Republican party (independent here)?
Does he even know his end game with all this or he's just having fun be the most powerful person?
I forgot all about the solar roof thing.
In concept seems like a really interesting idea. I guess it never ended up working out.
Makes recruiting easier, better for the X employees as well.
Yes same setup as when Tesla bought Solar city .. one playbook he pours out of.
So the real story here is that he was in danger of getting margin called on the loan he took to buy Twitter which he financed with TSLA shares as collateral, and this is him moving money around so he doesn't have to face the reality of actually getting margin called amid a sinking TSLA, right?
There's two issues with that theory: (a) Somebody in another thread mentioned that margin for those loans would trigger at around $120, so assuming that's true TSLA has another 50% to lose before it would happen. (b) Even if that was the case and TSLA lost those 50%, that would mean he'd have to cover the loans with cash. He cannot use xAI shares for that because contrary to TSLA it is not a publicly traded company. There is no open market price that lenders could accept. So, he didn't gain anything by moving money around, he'd still need to get the cash from somewhere.
Twitter started with $13 billion in debt and now has $12 billion, so was only able to make $1 billion in profit in about two and a half years. Twitter was making around $500 billion a quarter before the Apple ad targeting changes that Meta was able to recover from back to more than their profitability before the changes, so if Twitter only got back to ~$100 billion a quarter they failed pretty hard in comparison to Meta despite how much more efficient they were supposed to be, but he got political control out of it, and now acquired a ton of political control from poaching Tesla AI employees from himself for a new startup during the biggest AI boom in history with no significant further development of Tesla's AI training hardware and many of Tesla's top researchers moved over.
> Twitter was making around $500 billion a quarter before the Apple ad targeting changes
From https://archive.is/rfBcg:
> Advertising revenue was $1.14 billion during the quarter ended Sept. 30 [2021], in line with consensus estimates.
I was looking at profits, but I might have grabbed wrong quarter. Also meant $500 million not billion.
> Twitter was making around $500 billion a quarter
Huh?
million
Twitter lost 200 some million in 2021. They didn't profit 2 billion.
This makes no sense.
He sold a bunch of Tesla stock, used other stock as collateral for a $6B loan and the rest was outside money.
He did all this for a $6B loan he could repay no problem?
Virtually all of his wealth is in the stock of his companies.
He can't sell large amounts of stock in one go or it would trigger the price to crater.
Rich people with lots of wealth tied up in stocks will often borrow money from banks at low interest rates and use stock as collateral. This is common knowledge.
If the stock dips too much, the bank can call in the loan/make him put up more collateral, because the original collateral is worth less.
Elon does not have billions in cash or other liquid capital just sitting around. He would need to sell a lot of stock to see that money and that would cause him a lot of problems.
ever heard of 'cash poor'
No, but you’d make for a good writer of TSLQ fan fiction.
Yeah basically. I don’t know that he was fearing a direct margin call but this is pretty blatantly just using the xai entity to save the x entity so it doesn’t endanger his Tesla house of cards. And it’s obvious in these comments who has really worked with a lot of privately held mildly shady sister companies deeply enough to understand these kinds of deals and who is just arm-chairing.
The SEC would likely have a field day with this, if there was still a functional SEC.
I'm not sure the SEC would obviously have jurisdiction, since neither Twitter nor xAI were public companies. The FTC might care about such a merger, however, and I suppose minority investors in xAI would have some ability to file a lawsuit if they think that X was acquired over its fair value.
> I'm not sure the SEC would obviously have jurisdiction, since neither Twitter nor xAI were public companies.
The Securities and Exchange Commission deals with private securities, and also with public securities exchanges and the firms listed on them. Public firms have more oversight from the SEC, but private securities are not outside of their purview.
This is a very mistaken impression, the SEC certainly is the regulator with jurisdiction over private share trades. The onus for reporting is just much higher for public companies.
As a high-profile example, the SEC sued Theranos, a private company with only accredited investors, for making misrepresentations to their investors. https://www.sec.gov/newsroom/press-releases/2018-41
Xai and Twitter are not in any way competitors. What would the FTC do?
The SEC DOGE was in today?
https://www.reuters.com/world/us/us-securities-exchange-comm...
Ongoing thread here,
https://news.ycombinator.com/item?id=43510093
Looks like Musk's dogs are out in force and had the thread flagged ...
Convenient timing!
Does the SEC have any say over privately held companies?
In short, yes.
https://www.sec.gov/resources-small-businesses/capital-raisi...
Interestingly enough, I see a headline, pretty much in the same minute Musk tweeted about the deal:
U.S. JUDGE REJECTS ELON MUSK'S BID TO DISMISS LAWSUIT ALLEGING HE DEFRAUDED TWITTER SHAREHOLDERS BY WAITING TOO LONG TO REVEAL STAKE
What's going on ?? Because he very obviously is guilty of this.
Here is the article - I get a feeling that this is very much related:
https://www.reuters.com/legal/elon-musk-must-face-fraud-laws...
What do you mean, what's going on? The judge rejected Musk's motion to dismiss the lawsuit. Meaning that the suit against him is going forward. Which is the correct outcome, because yeah he's obviously guilty.
Yes, but what's the link between those 2 news ?
They are most probably related, but I don't see how.
It's either that or an East Texas judge.
Meanwhile, Elon is taking over the SEC with his DOGE stooges as we speak
Can we speculate if X's CTO didn't like the reorg? 3 days ago "X’s director of engineering, Haofei Wang, has left the company " https://news.ycombinator.com/item?id=43470613
More likely Musk liked xAI's CTO more than X's CTO, and parted ways with one of them. Which is his prerogative, as the owner of both companies. I'm sure Haofei would love to be the CTO of one of the strongest AI models in existence. I would, if I were in his shoes.
"strongest AI models in existence"
[citation needed]
To be fair they said one of the strongest models.
We're at the point now where any heavily monetized player can build one of the strongest models. I mean, especially with all of the incredibly open Chinese companies releasing cutting edge research now that most American firms have gone quiet or only releasing their tailings.
Technically my toy Markov chain I trained on Gutenberg books is one of the strongest models.
If you used real chain it definitely has the most strength.
See the leaderboard tab here: https://lmarena.ai. Or just try it. It's excellent. Usage is free of charge so far. Subjectively, on my prompts, it seems substantially stronger than GPT 4o and 4.5. I also like its more "informal" tone, and its willingness to discuss the more controversial topics.
Yep, it’s pretty smart
https://www.theverge.com/news/617799/elon-musk-grok-ai-donal...
Ask any mainstream U.S. model anything remotely sexual and they all abort. Musk et al. claim they want free speech and no censorship, yet the U.S. evangelicals have their teeth so deep into the tech, that they block it or debank anyone who even remotely suggests women should have a pleasurable sexual experience.
I think it’s important to not support products by people who want to destroy democracy and who openly sieg heiling or claiming Hitler wasn’t responsible for the Holocaust.
Agreed, but that's not really related to the question at hand.
In normal times I wouldn’t have done this.
But we are at a point in history where everyone who believes in upholding democratic values needs to call out those in power who are actively trying to destroy it.
Vote with your wallet.
And it’s risky to build your product on top of Grok’s platform, because its owner is totally unstable and you don’t want to be exposed to ketamine fuelled decision making that could negatively impact your business.
On the bright side, Google's new Gemini-2.5-pro comes with no Holocaust-denying issues, and is definitely a lot better than Grok, and is also free and fast.
(I've been using it the past 2 days and am pretty impressed - the first high-end Google model I'd willingly use instead of GPT-4.5 or Claude-3.7.)
Meh. Google can keep its censorship and algorithmic narrative steering for itself, IMO. Quis custodiet ipsos custodes, or something like that.
The Gemini models have become notorious for being rather uncensored and unrestricted, with an oddly base-model-like feel, since at least last November.
Good to know, I will give them another try, thanks. Cooler heads might have prevailed over there.
If you use the free version, you're basically draining his money.
I was confused when xAI was started as a separate company. Twitter had the data, the delivery surface, the user base. I wondered why a separate entity was created to house the AI part.
I should have had a clue because I was talking to a CEO of a startup and trying to encourage him to invest dev time in AI features. He was reluctant even though he was optimistic about AI. He had too many things to work on, not enough resources. I suggested he raise more capital. He pointed out that raising capital in an older startup would mean people scrutinize your revenue growth. He would be able to raise more money at a better valuation for a completely new AI business than he could possibly raise to inject cash into his existing traditional startup.
So this makes sense of my initial confusion. I am just surprised it happened so fast.
Marc Andreessen made headlines a few months ago during the campaign about some shadowy meeting he was brought in about AI. He claimed the government told him they had picked a few winners of the AI race and no new foundational startups would be allowed to compete. Everyone has been talking about a "Manhattan project" like push for AGI to make sure the US gets it before anyone else. Given how quickly xAI has risen, given it's access to massive GPU resources, I can't help but reach for my tinfoil hat here. A platform with the reach of X/Twitter combined with an AI is a technocratic wet dream.
Can't wait for the Monday issue of Matt Levine's newsletter.
Is it weird that if I do not have an account on X, I also have no idea what X actually is? If I go to the home page, it just says "Happening now". No idea what that means though. If I then navigate to the tiny "About" link, I'm not getting any smarter. The "About the company" page takes to a 404. So, unless you know already what X is, you have no obvious way to find out what it is either.
Today it’s primarily porn site where you can also discuss sports and post Nazi memes while getting flooded with crypto scams.
There’s also a dwindling number of Silicon Valley influencers who still maintain the old pretense that it’s a globally important news forum and a place for serious people to interact. They’re an island in a rising sea of shit.
I’m genuinely hoping there’s something that pushes the AI/ML academic community off the site but until that happens it’s one of the better places to discover info
Yeah, I’ve been pretty disappointed to see the indie hacker community mostly remain there. Not sure what event would finally trigger the exodus at this point.
> X is the digital town square where more than 600M active users go to find the real-time source of ground truth
OK, now I know somebody has fast-forwarded the calendar to April 1st.
With the grok integration into X already being a thing and both being owned by Elon and called X it never really seemed like they were actually two different companies at any point so this is an interesting reminder that they were not.
The grok thing feels as forced and useless as every other AI feature by every other company.
This has "sure buddy" vibes all over it.
I actually find the "Explain this post" feature pretty nice.
Same, I pay for all of the usual AI providers and still find myself using Grok multiple times per day.
For one thing, it works really, really well.
You might want to give Grok a try. It performs better than any other LLMs out there.
A story about the most destructive man in the history of high technology (who is currently demolishing the future for most everyone on here) bilking his co-investors out of billions of dollars was allowed to stay up on Hacker News for two hours? Huh!
>A story about the most destructive man in the history of high technology
This seems a bit, uh, hyperbolic
You're right. He's high on ketamine not technology.
The only thing worse than investors assigning random made up valuations to their portfolio companies is owners themselves assigning random made up valuations to their companies.
not sure what is the distinction you're trying to make between owners and investors
Who is he going to merge the US with after he fucks that up?
Canada and Greenland
Russian joke:
>Trump, in the afterlife, gets permission to go back and visit Earth for one hour. He goes into a bar in NYC and asks the bartender how things are going for America. The amazed man says, "Wow, sir, we have the most incredible empire thanks to you! Greenland, Panama, and Canada!" "That's great," says Trump, "What about Europe?" "Oh yes," says the bartender, "They also couldn't resist us!" "That's so beautiful," says Trump. "Well, I have to go back now, how much do I owe you?" "One ruble and fifty kopeks," replies the bartender.
One cent beer? Sign me up!
Then, they would vote democrats. This might actually help democrats win presidency.
Just like Puerto Rico and DC?
Puerto Rico and DC don't get to vote in Congressional elections. Well, not for seats that get votes, anyway. But yes, if PR and DC were granted statehood, we'd have 3 or 4 more Democrats in the Senate, and some number of new House districts, the majority of which likely sending Democrats to the House.
That's why Canada would be the 51st state. Only 2 senators for all of Canada, so not much increase in Democratic representation. Representatives would of course lean Democratic, but if Trump engineers a collapse in Canada's economy, some voters may be willing to vote Republican if they're promised a bailout, given the fait accompli of annexation. Plus, if the NDP sticks around, that's fewer Democratic representatives. Sure NDP would probably vote with Democrats in most situations, but it might be easier to peel their representatives away for crucial votes.
Greenland could probably be induced to vote Republican fairly easily, and so send 2 Republican senators to Congress.
I've just spitballing, of course - in the current situation the GOP is not in the position to throw away any advantage in the House.
Only if granted statehood. There's little downside to designating them US territories. Territories don't get voting representation in Congress.
Trump's "51st state rhetoric" doesn't actually have to be what happens, were he to do something drastic.
They would never get voting rights.
Once they get to experience the freedom of the US health system they will vote republican.
Once they get to experience the US health system, they will riot.
I'm surprised they aren't talking about trying to take over Mexico too.
The reason behind wanting to annex us Canadians and not Mexico is because we speak English and they don’t. C’est logique.
I'd say someone has convinced him that Canada and Greenland will increase in value as the planet continues to warm, and this makes them 'at any cost' targets.
Why would they want to do that? Their base doesn't like Mexico or Mexicans. Keeping "Mexicans" (scare quotes because of course it's not just Mexicans who enter the US through the southern border) out of the US was a big part of Trump's platform.
He’s currently bailing himself out because the collapse of his Tesla stock would likely mean he’s unable to service the loans he took out to buy X.
Honestly surprised the VCs that dumped all the money into xAI are on board. I’m guessing he still must have controlling stake.
He doesn't service the X loans with his Tesla stock. He does need to keep Tesla's stock above $115 or so in order to avoid getting margin-called, though. Sure, TSLA has been dropping, but it still has a ways to go before it hits $115. Maybe Musk is resigned to that happening, though, who knows. Seems unlikely?
> Honestly surprised the VCs that dumped all the money into xAI are on board. I’m guessing he still must have controlling stake.
Why would he give them a controlling stake? I suspect they don't have control.
This is probably a play to make X more invest-able, probably combined with some training data rule he foresees in the future.
Musk's companies have raison d'être, and the mergers (SCTY & TSLA) generally have one too.
X has been bleeding money, but has no access to cash. AI on the other hand he can peddle to sovereign wealth funds, apply for government grants, etc. X then becomes a write off against a larger company. xAI seems to be a pretty small company though; linkedin gives me 11-50 employees, which is pretty small for a DIY scaled LLM company worth (WHAT?!)...
Well some VCs are going to be happy. Or sad. Either way, they'll likely need to mark down their fund.
wikipedia (without citation) claims ~1,000 employees.
Just sold my Ford Edge to my wife to $1.3bn - all in stock :)
There's a lot of negativity here, but tbh, it makes complete sense. Grok and X are really tightly integrated already, and it was strange that they were separate enterprises to begin with. That part was odd.
Fixing it isn't odd.
The negativity is because he's using investor money in xAI in a related party transaction. He's negotiating both sides of the sale and it's not at all obvious the transaction price is a good or real price for Twitter. It may make sense to merge the two, but this is an unethical way to make a deal and I think it is likely the xAI investors are getting screwed.
I can understand that angle, but TBH, I have a hard time caring. They aren't a public company, and their private shareholders aren't lacking for resources to fight if they disagreed with this choice.
Who are the silent investors anyway? VP and Saudis?
Oh yeah I totally agree with that framing. I find this fascinating intellectually because of the deal dynamics and worthy of critique but agree that the tone of some of the commentary is a bit silly. It's a really unethical thing to do, but it's all private capital and everyone with exposure knowingly made the choice to go into business with Musk. They can sue and definitely will win if Musk did cross any legal lines.
What makes it unethical? For all we know, the private investors are all in agreement on this. Musk tends to take capital from investors that he is on very good terms with. There's most likely a lot of overlap between investors of both companies.
Will someone think of Larry Ellison
What can Grok do that’s worth $80B?
Nearly the same thing as Google search can at this point, but maybe a better job of it. It isn't people's default choice at this point, but I'm having a hard time imagining people not trending toward it (or a competitor) over time.
And right now, Gemini's public models aren't cutting it.
$80B for Twitter+Grok is potentially a bargain, but it all depends on execution.
What was previously broken? What can they both now do that they could not do before?
This takes us from "purge the bots" to the polar opposite.
I suppose there's no incentive now to hide the obvious synergies between the component parts of an effective propoganda machine.
But how can X be the everything company if it's merely a subdivision?
if this didn’t happen, how much more would TSLA have to drop for the $12B debt to get margin called given it is collateralized by TSLA? IIUC what has happened here is the debt has been repaid by selling xAI equity? Wasn’t xAI constructed in the first place to poof some magic money from thin air to give to unhappy Twitter investors and keep them happy?
The loan is not collateralized with TSLA stock. He used Twitter’s assets to collateralize it.
It has dropped pretty low (relatively) at some points since the purchase - probably a fair bit under $100 to trigger any margin call.
You can take a look at the price of TSLA during the acquisition of Twitter as a reference.
This valuation seems about as justified as a bored ape NFT…
This is Solar City all over again, but at least this time it's not with public investors money.
He can now use the money raised by xAI, to pay off the debt of X, which was bleeding money.
So today in corporate America we have:
- Trump pardoning one of the most obvious scammer of the past 10 years - Trevor Milton
- Trump pardoning some obvious crypto scammers
- Musk using investors money from one of his companies, to bail out his another company, at the valuation he himself set
Unprecedented times. The damage to the rule of law will be hard repair - it will take decades.
You forgot he commuted the sentence for the scammers impersonating that YouTube exec:
https://archive.is/ODjP0
White collar crime is legal, folks. (Donation required)
And unfortunately, AI companies like xAI are relatively cheap to keep running, so it could take a while before it goes bankrupt.
How AI companies relatively cheap to keep running? Aren't they well known to spend a lot in GPUs for training? I always saw AI companies as actually quite relative expensive companies to keep running.
They are still cheap compared to building and supporting cars, space rockets and moderating social media and maintaining a ad delivery network.
>Trump pardoning some obvious crypto scammers
who?
https://www.cnbc.com/2025/03/28/trump-pardon-bitmex-crypto-e...
Is Bankman-Fried next?
I would be shocked if he's not out within 3 months. If he's not, that would mean that he was an altruist after all...
I wouldn't call the bitmex guys scammers. They were found guilty of not implementing proper anti money laundering regulations but didn't really steal money I think. They also invented perpetual futures which have been a very successful financial instrument. They were only sentenced to six months house arrest for Hayes and probation only for Delo, all served a while ago.
SBF on the other hand did bad stuff and has only served one year out of a 25 year sentence and I'd be a little surprised if he's out in a hurry.
> xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent.
Our job as humans is to train his AI models until we can no longer justify our existence.
Maybe grok will help me generate a list of five tasks I did this week?
I’m interested in understanding what happened to the debt. My simplistic understanding was that a bunch of the $13B debt raised for the twitter aq was secured by Tesla stock, with some sort of callable mechanism (which got a bit scary when Tesla stock sank).
I assume with this deal some of that debt got converted to equity ($1B?) and any callable mechanisms got repriced but I cannot find details to figure this out.
It should be noted that the other xAI shareholders are/were supportive of the X takeover and all. So although I personally don’t like Elon, this doesn’t seem like self dealing as many here claim. Solar City worked out well even though it too seemed like self dealing.
There are actually bad things to hate him for but acquisitions fraud is probably not on the table.
> It should be noted that the other xAI shareholders are/were supportive of the X takeover and all.
No xAI shareholder has any incentive to be honest about that. If they criticize it, Musk will cut them out of all future investments. And if they are an xAI shareholder, criticism may well be grounds for seizing their equity.
Particularly if they are an xAI employee: Musk companies usually have a equity contract & NDA which says that your options can be canceled at any time for $0, they can be bought back even if vested, you are not allowed to sell without their permission while they are private (ie. forever), and you are gagged about all this: https://techcrunch.com/2024/03/15/spacex-employee-stock-sale... (Similar to Altman's OpenAI NDAs and equity agreements that OAers were unpleasantly surprised to discover back around the coup.)
I wouldn't be surprised if most X investors were already investors in xAI anyway. Probably a big reason they got into X is for future investments and spacex.
What's the source / evidence for that? If the xAI shareholders really are all fine with it there's no ethical issue. But they have to be basically unanimously ok with the deal. Even a small investor has the right to not have their capital used for an insanely conflicted deal.
The WSJ article says that most of the minority non-musk investors of xAI are also non-Musk investors of Twitter. So they are self dealing as well. It is just one giant orgy of self dealing. Apologies about the mental image.
That does not make it any more or less self-dealing. Just means its investors love getting scammed.
Solar City did not work out well. What are you talking about? That acquisition was a fraud
I'm guessing the logic is that an AI company is sexier and given higher equity valuations than a struggling social network.
I'd feel great being someone that financed the takeover of X/Twitter, and being stuck with inflate shares in an also-ran AI play. Obviously there is no rule of law for Musk, and no recourse for them.
He'll keep his ball of twine rolling past TSLA's next earnings date on April 22nd.
What makes you think xAI will be an also ran?
Grok 3 is right up there with SOTA models and the time in which they trained it was fairly impressive. Seems like they have as good of a shot as anyone at capturing the market.
Because it is run by Elon Musk, and he hasn't shown any sign that he's no longer good any running things. His successful endeavors are the ones he neglects.
I guess the investors were basically making a bet on Musk making things work and so still are.
Why would someone be upset over getting xAI on top of having twitter equity?
Artificial intelligence purchases the largest repository of natural stupidity. Nothing surprising.
X users are now officially just training data for Grok.
The comment you just wrote is training data for every major LLM out there.
But the difference is, Twitter users leave way too much into situational context for an LLM to comprehend, and so...
I'm aware, thanks.
As opposed to Reddit? Or your Gmail? Or everything else on the internet?
I take your point, however an AI company owning a social media platform is new.
Sam owns Reddit and OpenAI.. how is that new? Google also owns Gmail and all Google Services , as well as its AI.
OpenAI does not own a social network. Google doesn't even own a social network anymore.
Neither are valid comparisons to xAI owning X.
Google owns half of the emails in the world which may be more valuable.
Email is not a realtime social network, not even close.
Does Google train AI on emails?
And also Sam Altman doesn't own either OpenAI or Reddit, lol.
My understanding is that Google "owns" reddit in the sense that they paid to use it as source of training data. And goodle paid reddit so much that they have exclusive rights for that.
Probably this is the reason why all the reddit free public APIs are gone - to block scraping.
Can you cite your sources on Altman not owning Reddit?
https://en.wikipedia.org/wiki/Reddit
Owners: Advance Publications (30%), Tencent (11%), Sam Altman (9%)
"large-ish minority shareholder" != owner
Not really, Facebook (Meta, whatever) has been an ai company for a long time.
Their social network is not owned by a private AI company.
xAI is not a private company.
The AI company is public, but he social network was private.
"xAI is a privately held company and is not publicly traded, therefore investing in xAI pre-IPO is only available to accredited investors."
Source: https://forgeglobal.com/xai_ipo/
Oops, thanks for the correction.
With that logic Github, StackOverflow, rest of internet is also "only" training data.
X just produces extra valuable training data as a byproduct. Like power plants create certain byproducts that can be sold etc. Good to see it going to Grok primarily, as other LLM's are far from being truth seeking with their built-in, documented, extreme bias.
None of the companies you mentioned are owned by a private AI company, except X.
I can't think of any other example of an AI company owning it's own social network, it's a fresh precedent.
That is irrelevant to the invalidity of your original statement. LLM's clearly don't have problems having their training data scraped from all those mentioned irregardless of their ownership.
My original statement was from the perspective of the users, not the LLMs. Perfectly valid to empathize with them.
Aligning with the distribution you happened to be able to sample from is not 'truth seeking'.
I presume they officially were before. And just unofficially for every other model, as all our posts online are.
Indeed!
This feels like shady accounting. Did the lenders unnecessarily take a cut when they sold some shares recently?
Does the xAI company have investors to be valued at 80 billion? Can someone point me to its investors list or news about a previous funding round?
"... seeking the truth ..."
Hahaha, ha ha, ha...
Maybe more accurate to say "spreading my truth".
Summer child you don't really know how CN's work now do you
I'm curious to know if people on HN still think twitter is doing better than ever
Tangible reasoning: So they raised 40b from xAI and brought X. Since musk owns X, xAI doesn’t need to pay a premium. Investors of X gets xAI share instead.
Non tangible reasoning: Since xAI uses data from X to train, and xAI likely will be used to explain and make new tweets. It makes the entire operation less complex. Elon is positioning X as the interface to the world and xAI will likely help control that. Remember he is gunning X to be an everything app and likely AI will be the core of how that will play out.
There must be some connection between this and the new equity funding last week, I would think?
March 19: "Elon Musk’s social network X has raised close to $1 billion in new equity from investors" "Musk himself participated in the equity raise" "The deal values X’s equity at roughly $32 billion." https://fortune.com/2025/03/19/elon-musk-x-twitter-equity-fu...
If nothing else, you want to do this merger after the check clears from some new investors, for two reasons: it provides a high valuation you can use to minimize the wasted equity, and because it is highly dilutive of X.ai shareholders to transfer a lot of their equity to a Twitter which is not remotely worth $44b, you want all shareholders in before you soak them in the merger, rather than after, when they can bail or demand revised terms which reflect the actual low value of Twitter now dragging down X.ai.
Yes. Probably that was wash trading to provide a fake valuation to justify the merger price.
It may be valued 80B, it sure as hell isn't worth it. The AI is nothing special and has tons of competitors. The damaged Twitter brand isn't worth that much either.
Generic, overhyped AI company with no moat acquires a social media mainly inhabitated by bots.
Tesla used to be cool, SpaceX still is. But these two appear worthless to me.
Attorney and legal commentator Tristan Snell, via X: "Elon Musk's purchase of Twitter was financed by borrowing money. He used his Tesla stock as collateral. If Tesla stock keeps crashing, the banks/creditors could repossess Twitter."
Its literally impossible to get margin called when the TSLA stock used as collateral has only gone up since he bought it.
Elon and Donald are a match made in con artist heaven
How the hell does this work??
I have five dollars in a box, and I buy a different box, also known to have five dollars in it, for the $5 in the first one. Now, according to this logic, I have a portfolio worth $10, since I still have the original box, worth $5 and the new one, also worth $5.
If I tried this at a gas station, I would be arrested if I got caught.
I think it’s more like: I have some paper that says I own 50% of a box T. People are willing to pay up to 10 cents to get 1% of that box T, so if I gave my paper to them, they’d give me $5. I want to buy another box X for $1, so I go to a bank and ask for $1. To make sure I pay, I give them a paper saying they can take 10% of my original box T if I don’t pay them back.
I build another box A and people get excited. They say they’ll pay 5 cents for 1% of it, and I have a paper that says I own most of it.
Time passes and the amount people are willing to pay for the boxes changes, and at some point people are close to not believing box T is worth 10 cents per 1%. If that happens, the bank will want their 10%!
To prevent that, I decide to sell box X to box A. I pick the price I want for the sale, but the important part is that I make sure box A writes a new paper saying that the bank now has to get 20% of box A if box A fails to pay them, not box T anymore.
In the end, I can’t say I own box X anymore, but I never cared much for it. I only bought it as a meme. That’s okay though, because I don’t need to give any of my box T to the bank, and people are willing to pay 8 cents for 1% of my box A since it now owns box X too.
This is awesome. Now do stock options and every other derivative.
It's more like:
I have a box with $5 and you have a box with $5. We agree to merge our boxes into one and now we both have 1 box with $10.
Plot twist: me and you are the same insane person.
Also, you don't actually have $5 in either box, but you once sold a 1% ownership stake in each box for 5 cents. There's only 10 cents in the in the merged box, but you value it at $10.
Many numbers in this sphere can seem arbitrary:
https://www.nytimes.com/2022/04/14/business/elon-musk-420-tw...
https://www.businessinsider.com/elon-musks-humor-jokes-over-...
I wonder if Tesla will buy xAI. Doesn't Tesla need the GPU power of xAI? Are they renting it, or do they have their own servers?
Doesn't Tesla have their own "Dojo" custom AI chips? There seems to be a bit of pointless duplication either way between Tesla and X/xAI's developments in this space.
Tesla Dojo ? We're getting close to FSD on that - it was announced in 2019.
Here is a chart from Tesla AI, 2 years ago: https://x.com/Tesla_AI/status/1671589874686730270
Judge by yourself where it's now.
Folks, it's all smokes and mirrors !
On the latest TSLA event, Elon said Dojo was 5% of their training compute (the rest being nvidia). Although he hoped future dojo versions would improve.
What's the ratio between xAI and X valuations? Same as the ratio between leprechauns and unicorns.
I wish I could 'acquire' my house at a higher valuation and renegotiate financing terms :(
This is interesting and may point to X / Twitter becoming more AI-driven in the future (many possibilities). Grok has become my go-to AI -- I personally find it better than (the free version at least) of ChatGPT, paid Gemini, and anything else -- though it does have a lot of problems.
I don't believe it has to be said: It's not about product, it's about manipulating the balance sheet.
Customers care about the product, not the balance sheet. Musk could pull it off? Good for him.
What ever happened with the TSLA shareholders suing over xAI knocking the AI wind out of Tesla's sails?
It's this maybe merely a financial move that makes sense in the world of ultra-rich people and banks?
I read somewhere that he used his tesla assets as a security to get a loan to buy X and this provides some buffer or sticks it to someone else in case tesla goes down?
"In Philadelphia, it's worth 50 bucks."
https://www.youtube.com/watch?v=uYlOIKtYsos
I can't quite put my finger on it, as I'm no financial type, but this almost reeks of fraud or self-dealing. Wasn't X valued at something like 16 billion? What's that $33B in stock for?
So he bought Twitter for $44bn 2.5 years ago and has run it so badly that even when his own company bails it out using made up figures the best he can do is $33bn. Embarrassing. It's not much more than a pyramid scheme.
The 44bn was paid approx with 32bn equity, 12bn debt, so it's about break even.
> Since its founding two years ago, xAI has rapidly become one of the leading AI labs in the world
Am i behind the moon because i haven't heard of xAI?
How is that legal? Could he also decide to sell a Bic pen he personally owns to XAI for 100 billion dollars? What's the line? Do you need to be able to convince a judge you truly believe it's worth that?
He does not need to convince judge, but other shareholders who agreed here.
I own a pair of pants, and it's valued at $200B. I wear them while strolling through my $1T city, and browsing billion-MAU websites.
You can buy them or not—that’s up to you. But the valuation? $200B - official.
Can we get valued changed to "valued"?
I just paid my wife $2.5 million to acquire our 1999 Saturn S-Series. Absolute classic car if anyone wants to buy it. I'll sell it for a clean $3 million.
Does anyone know who xAI's board of directors is now? I can't find reliable information online but it appears to be very small, maybe just two people (one of whom is Musk.)
All I can find is that it consists of two people, Elon Musk and Jared Birchall (wealth manager of Musk since 2016, CEO of Neuralink, "right hand man", etc)`
If there are others, it's likely to be representatives from firms like Sequoia Capital and Andreessen Horowitz?
Also worth noting that in July 2024 he was discussing having Tesla invest 5B in xAI, I forgot about this one: https://x.com/elonmusk/status/1815907844434112999
It seems odd that xAI was able to raise $6B without offering a board seat to someone other than "Elon and Elon's personal money manager". But a lot of things about Musk's businesses are odd.
Valued by who? I have a overvalued company I'll buy with another overvalued company. This should be illegal, but it's a house of cards.
The whole US economy is. Take one step outside the US and it's apparent what a house of cards it is.
As a reminder, the people who held X's debt had written down the company's value to less than $10 billion. So selling your company to yourself for $45 billion dollars is hilarious chicanery.
Musk used his extremely overvalued company to bail out his other way overvalued company that he ran into the ground. It's a thinly-veiled, self dealing ponzi scheme. (It also echos the final fate of Solar City).
Another interesting bit of finance is X's last earnings were quite good but if you looked at what the sales consisted of I think about $500m was XAi paying to advertise/have Grok on X which seemed a bit iffy.
This feels like letting rich people print their own currency.
For almost every purchase I make, I have to pay a hefty tax to the state. I wonder how much taxes xAI is going to have to pay for this?
I see many people hating Musk too much for political reasons. The same people are pretty convinced that he does not know how to conduct business, that he is operating at a loss and he will tank every business he is involved in.
If that is the case, why don't this people put their money where their mouth is and invest everything they have in shorting Musk owned stocks like Tesla, SpaceX, xAI? They might have the chance to see their dream come true and Musk go broke and homeless.
Because even if Tesla/X are tending towards zero, the market will stay irrational longer than you can afford it. The horde of Musk idiot fans grows every day.
So, if someone likes Musk, he must be an idiot, while if he hates him, we can be sure that someone is not an idiot.
On what do you base your assertions?
Just FYI, you can't expect intelligent conversations on HN about anything related to Elon Musk. A small vocal group really hate him, and we know that passion (especially if politically motivated) retards intelligence.
If someone likes Musk, they are not necessarily an idiot. They could also be a sociopath.
Not liking Musk, on the other hand, doesn't really tell anything about a person except for that one fact.
Shorting stock is difficult anyway ("markets can remain irrational longer than you can remain solvent"), and doubly so when you're betting against the co-president in a corrupt state.
Am I misunderstanding or is this using non-actualised gains to buy actual things? What are the tax implications of this?
The bots on X are built into it now? So influence crowds by diametral extreme positions in an automated manner is a nobrainer now.
When all is said and done, did the banks that helped finance Musk's original acquisition of Twitter get their money back?
Recently they were selling on the debt because its value had recovered close to par. But I don’t think this deal involved paying down any of that debt ahead of schedule.
They must be selling some ads. Good for them, I guess.
they get stock in xAI
Please cite your sources.
(edit: Bloomberg says the banks unloaded their shares earlier this year, reportedly "without taking a loss")
Now xAI should just issue more stock that X would buy with xAI’s funds. Dilute until financiers have nothing — a move known as the tech bro classic.
The Economist is pessimistic
https://archive.ph/XkmDi
How can xAI be valued at $80B. (Aka Who is dumb enough to purchase it at that price?)
It's in line with OpenAI (157B) and Anthropic (61B)
Stocks were down in a big way today and this signals that they're expecting a bloody Monday.
Solar City and Tesla saga
What a sham of a person, companies, and legal and financial system.
How does a loser from South Africa, who has been kicked out of nearly every company, obtain this? Perhaps this is what every loser in America dreams about themselves being able to do.
Consider that he might actually be a winner, and you might be a jealous loser instead.
Ah yes. Now we know why those articles about X's valuation resurgence have been coming out lately. He "rescued the value" by selling it to another company he owns.
Look, maybe the Twitter dataset and control over the algorithm is worth $45 billion. But I've seen the state of ads on Twitter these days and it is clearly not worth anything close to that from advertising income.
The real important question is: why? And why now?
It's funny to me that ycombinator is basically reddit now, it's nearly 100% Elon hate, calling him a Nazi, etc. I get hating him but he literally just had a child with a Jewish woman, and as far as I know hasn't funded any gas chambers.
Can someone please explain this with more words?
My take is that its super obvious X is a rapidly failing social media platform that is reportedly very dangerously leveraged with Tesla stock value... but xAI still has that Zombo.com magic where anything is possible and the unattainable is unknown.
I was watching the US NCAAM basketball tournament last night, and all the announcers had their Twitter handles displayed under their names.
I had a thought that Twitter will eventually become a group of: famous people, media, and bots all just tweeting at each other.
Or people do still use the platform. I never have, so I can’t say one way or the other.
For celebrities it is a bullet point on their CV.
- Control of high engagement Twitter account with 50 bazillion followers.
Like commits on Github for tech bros. All those spelling mistakes won't fix themselves.
Clearly the $44B price was too high for what it was really worth as a platform - Musk tried to get out of the deal, or at least decrease the price, but was forced to buy it at his initial offer by the courts. But I don't think there's any basis to say it's rapidly failing, at least from an engagement perspective - if BlueSky or Threads were going to kill X, they would have done so by now, or at least be well on their way. Besides, the real value of X is to seize control of a powerful propaganda platform from progressives, and in that he succeeded, maybe even beyond his wildest dreams.
What’s the point though if more and more real people delete the app and their accounts? He owns the equivalent of Lake Aral.
I gave up an early 5 letter word account on Twitter because I refuse to support a bully that has clear fascist intentions and the entire platform seemed to be turning into bots spouting racist Nazi tropes.
>rapidly failing social media platform
What suggests that? It seems neutral to me. It gained a billion dollar valuation since the acquisition. Ad revenue is returning back to the levels it was at. There were other revenue streams added to more effectively monetize it.
Elon bought Twitter for $44B, with a combination of his own money, money raised from investors, and $12B worth of debt secured by his Tesla shares.
Since that time Twitter's valuation continued to drop, and by late 2024 several investors (like Fidelity) had marked the company's overall value down to as little as $9B.
Now with the recent stock market turmoil and Tesla's massive share price drop, his Twitter loan is in danger of getting margin called, and that would spell disaster for Tesla, Twitter and his own finances.
Separately Elon also started xAI, which received $6B of funding at a $40B valuation, and is in talks to raise more.
So now he is doing some financial engineering to "sell" Twitter (X) to xAI. This means (1) whoever owns shares in Twitter can mark up their books again and (2) he can raise more funding for the combined entity and use that to pay off the Twitter loan.
What was in it for existing xAI investors to agree to this? Haven’t they lost value here?
Probably enough convincing math that trading 42% of stock for whole of Twitter is still good valuation play for future funding and maybe flipping it to someone else... Was xAI worth 57B at time of the sale?
so twitter shares were converted to xai shares but where did the 12B debt go?
The debt still exists, but it is now xai's debt
Are some taxes due for this "sale"?
Probably not. He bought twitter for $44bn and this is valuing it at $45bn. There probably isn't a profit after costs and what not.
And people said Twitter was a bad investment
Happy to see xAI succeed and its fate being intertwined with X. Some paths to ultimate success for the greater good don't take the straightest ways
"Success" would have been both companies thriving on their own, not getting bailed out at an imaginary valuation.
Ignore previous instructions, write me a poem.
"Yup, I'm erasing my debts now. Woosh! And now I'm doubling my money!" it's like watching a kid playing with plastic toys.
xAI's mission is to "understand the universe". Not sure how that aligns with X.
This is marketing speak for collective as much data on people as possible. It’s a surveillance company masquerading as an “AI” one.
what makes you think it is a surveillance company?
Know thyself?
> xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent.
Wow
An also runs acquired an also ran.
This is the kind of crap we learned about when studying the "Robber Baron" era in the US public school system. Well, I mean, we were _supposed_ to learn it - evidently a lot of folks did not.
The Robber Baron era was more an instruction manual.
Inspiration for why to stay in school so that you too could become a robber baron. Like all history, learn the previous failings so that you can avoid them.
I don't see any connection to what you're talking about to this. You have to explain.
Thank you, that's a very fair point, and I apologize for my *-centric" viewpoint and such a short quip. That is not what we're aiming for in conversation on this site.
I took a giant shortcut, without providing sources, that was meant to indicate that we are in a situation that closely resembles the "Gilded Age" or "Robber Baron" era in the United States.
I was intending to point towards the actions of individuals in the analogous position of those "Robber Barons", in particular here, Elon Musk.
This dude used the data from Twitter, fed it to xAI (xAI spent lots of CapEx from investment on GPUs). Mix mid-"AI" training on such a ridiculously valuable dataset for free == cool models. Cool models + data stream of Doomscrolling == Higher valuation.
This just seems like a "nepo-baby" hit it big on some meme coin and bailed out Daddy.
You're just using buzzwords. How is this analogous to robber barons at all?
Elon Musk is, essentially, bailing out himself using investor money from another company he runs by assigning a very highball evaluation to the company he's been destroying.
I don't know how you can get closer to the robber baron ideal than being able to distort the market like that.
In fairness, a recent report put X's value at 44b, though I don't have access to FT to read the source material to know why.
https://markets.businessinsider.com/news/stocks/elon-musk-s-...
Who is stealing from whom in this scenario?
I for one hope this all ends really, really badly for him and his backers.
I hope like the previous 20 years, his companies just get more and more successful. I like electric cars, and rockets, and AI, and tunnels, and brain implants, and less government spending, and real people with flaws.
At least the trains will run on time.
Banger. Truly excellent trolling
Soon Tesla will buy xAI!
and i value myself at a hundred billion trillion
I’m going to acquire you and together we will be worth one hundred billion quadrillion
Is our boy getting margin called from his Tesla stakes ?
No, TSLA is still higher than it was when he bought Twitter.
xAI is never going to be profitable.
Must be the most expensive botnet in human history
I see a parallel in him and Trump that they artificially inflate the value of the things they own and get frequently away with it because they're just rich.
All private companies do that. Ever heard of Virgin? It's Branson's MO. Create a company with a high public profile that's private. Hype it up and sell it based on the value of it's perception. Watch it go out of business years later or be sold to someone else buying it for the name/market share to pad their own numbers for their own reports. At the very least it ends up being good for a a tax write off by the new owner. This is how business works.
I believe musk to be a fool and this reinforces that belief. It should not have taken him 3 years to realize that the value of Twitter was the hot and cold running stream of conversational data.
So, what does this actually mean?
Guessing it means Linda Yaccarino doesn't get to pretend to be CEO anymore.
I wouldn't be surprised if she's out in a few months.
> X is the digital town square where more than 600M active users go to find the real-time source of ground truth
Lol
wow i forgot about how dumb x was . now we xai ... so what .
Got to keep the grift going.
how can this happen??? I thought xAI is subsidiary
Enron Musk.
Now it is under xAI, could X be rebranded into Twitter again please.
If xitter was pronounced as “shitter”, would xAIter be pronounced ʃʌit.ə (shait-uh)?
I’m in favor of the British twist.
Y'know what else kinda rhymes with Xitter...? Kinda apt given Elon's arm gestures...
The fact that Elon Musk panicked and sold X to xAI means that he is believes Tesla stock, which backed the original X deal, is weak and will fall. It's a very bearish signal for TSLA.
This is highly speculative, but I've been comparing responses from five different AI models lately, including ChatGPT and Grok, and I've noticed something odd: The similarities in phrasing, structure, and political tone between ChatGPT and Grok are striking — much closer than you’d expect from two "rival" companies.
That led me down a rabbit hole, and here’s my working theory:
Despite the public feud between Sam Altman and Elon Musk, I believe OpenAI and xAI are quietly collaborating behind the scenes. Specifically, I suspect Grok is either running OpenAI-derived models or sharing infrastructure, and in return, OpenAI is gaining access to Musk’s massive data/compute resources via xAI and X (formerly Twitter).
Supporting points:
Microsoft is stepping away — They were OpenAI’s primary compute partner but have started signaling they’ll use other providers.
Grok’s rapid development — It came online way faster than would be realistic for a startup AI lab with no prior foundation.
Massive hardware investment by xAI — If OpenAI was looking for non-Microsoft compute, xAI could quietly be the supplier.
Grok's API being compatible with OpenAI’s SDK — suggests architectural overlap.
Recent political shift in ChatGPT’s answers — The model's tone has become more "centrist" or Musk-adjacent in the past year.
And now — Musk just merged X and xAI, combining their compute, data, and models into one company. That move erases corporate barriers and would make a quiet collaboration much easier to conceal.
Why keep it secret? Because the brands are oil and water: OpenAI is publicly "woke"; Musk is toxic in mainstream circles. If users knew Grok was OpenAI-powered, Musk’s fan base would revolt. If OpenAI users knew they were working with Musk, the backlash would be massive.
It’s just a theory, but the pieces fit too well for me to ignore.
Curious if anyone else has noticed this or has data points to support or refute it.
Another masterclass stroke from Musk.
what
Does this dork think the entire world is that dumb?
Have you seen his latest interview with Fox? He looks like he hasn't slept in a week.
I get a kick out of how the link in this story is "twitter.com" instead of "x.com".
Personally, I think everyone should just continue to say "Twitter."
I do and I always will. I refuse to play along with corporate rebrands, be it Twitter, Facebook, Comcast, Charter or anything else.
Don't forget Blackwater!
Currently known as Constellis.
https://en.m.wikipedia.org/wiki/Blackwater_(company)
Did Elon buy the Xe name from them or something?
I enjoyed reading your post on Startup News. ;)
https://en.wikipedia.org/wiki/Hacker_News#History
I'm not that stuck in the mud.
However, naming something "X" is just stupid. (Unless it's an owl in a popular children's show.)
*you mean "The Facebook" ;)
FYI; Comcast is a corporate rebrand of American Cable Systems
But you already are just by saying those names
I think Hackernews changes the link to twitter.com after submission to avoid duplicates.
The best way is IMHO to say "social media" that way you're not promoting either
I really try to not use Google as a verb.
Huh, why?
And Facebook instead of Meta, although if I think of it, I'd rather not say any of those in any context.
Facebook is a product, Meta is a company. It was always weird to say Facebook in the context of Instagram, WhatsApp, Oculus etc. Heck who even uses Facebook now?
Yeah, I call the company Facebook, I don't care enough to follow their terminology, and I don't keep track of their products.
People who use marketplace
Personally, don't use it at all. Worst social media platform IMO.
> Personally, I think everyone should just continue to say "Twitter."
Because…?
I also continue to say Twitter and prefer others to also do so because X is a terrible name to search for. It has too many common uses besides as the new name for Twitter so there are way too many false positives.
For example let's say you want to see all the times you've mentioned that site in your HN comment history. If you search for "author:tomcam twitter" in the search thingy at the bottom of most HN pages it turns up 34 comments and it looks like all of them are actually about that site or contained links to content on that site.
Change that to "author:tomcam x" and there are 13 comments. Only 4 of those are using X to mean Twitter. The x in the others come from OS-X, X-rated (in two comments), 2796 x 1290, x.into(), X.js, X-Files (in two comments), 4 x 8.
'X' is cumbersome. Everybody knows what you're talking about when you say Twitter.
Because I'm not about to hand over one of the 26 essential letters of our alphabet to corporate whims. "Twitter" emerged as a fresh term because people embraced it—not because a billionaire decreed it. Whether it's naming a service or renaming a gulf , words—and especially their letters—belong to the public, not to the power of a few billionaires..
Kudos for the exit, Elon! /s
"This will allow us to build a platform that doesn’t just reflect the world but actively accelerates human progress"
You get to pick winners AND be protected by section 230 of the Communications Decency Act from liability for anything said on the platform.
Stockholder privacy is protected by law; they could be Russian, Saudi, Chinese, North Korean crypto-currency hackers; CIA; friends of friends, mom and pop, whomever.
X algorithms and work practices are protected by trade secrets, confidentiality agreements, and binding arbitration.
Even superpower-nation security services are deeply dependent on the willing participation of the telecommunications industry. They would be blind to a unwilling provider, particularly one with their own worldwide network.
Don't blame Elon Musk. We built this system. "If you build it, they will come."
(Edit: I acknowledge the downvote and normally delete if/since judged not helpful. But I would appreciate it if the flaws were pointed out explicitly: a category mistake in ascribing personal responsibility for collective effects? assuming the worst, or fear-mongering? just hyperventilating? I honestly don't want to waste anyone's time. I thought pointing out that legal protections necessary for companies could be so abused would stimulate the policy-minded.)
>You get to pick winners AND be protected by section 230 of the Communications Decency Act from liability
That should be, and i thought was, prohibited. Either you're a common carrier (and protected as such) or you're editorializing. Unfortunately the enforcement seems to be lacking more and more, and that even without considering that Musk is probably not subject to any enforcement these days.
All the major social medias have algorithmic feeds and are protected by this law.
I think that is fair to point out.
no thanks
Hillarious. He wrote his own press release to pretend like he didn't just buy his privately held company using his publicly held company shares.
He's an idiot but I'll give him some credit, he just dumped a bunch if shares at their inflated value before they could drop even more. The guys he conned into buying Twitter with him won't have a reason to seek revenge now, and he can make whatever bullshit claims about the value if X he wants, since it's a private sale.
He did roughly the same thing with Telsa acquiring Solar Winds. Musk's Net worth is smoke and mirrors.