Elon Musk Buys Twitter

[fwc577]

Apparently, Elon Musk does know how to pull out.

A proper pull out would've been well before this shit show put him in a place where he's going to be forking over billions to back out of the deal.

Twitter is just going to be another failed attempt at raising yet another child.

#10 if we're keeping count.

[hellhamster]

I have no horse in this race but man, what a shitshow. I wonder how much money went down the drain.

If he isn't forced to buy it and somehow manages to pull out, he will definitely face charges of fraud by manipulating stock prices. He may get hit with fraud charges regardless though.

He will buy, and I don't think he has a choice. It's probably sensationalist journalism that says he can pull out.

- - - Updated - - -

One thing I can kinda see playing out is Musk selling Tesla back when it was $1000 to so-call fund the Twitter purchase. Of course that was done under pretense, he has no desire to buy Twitter, he just rused everyone to lower the Tesla stock so he can buy back in at 30%+ margin.

If he doesn't lose dozens of billions on the Twitter deal, my theory will probably be correct, but it's not looking likely right now.

[Fantomen]

If he isn't forced to buy it and somehow manages to pull out, he will definitely face charges of fraud by manipulating stock prices.

Why? If (andf I say if) he manages to pull out, he have proven that somthing was wrong with Twitters number. So the fraud charges will be aimed toward Twitter and not him.

[Draco-Onis]

Apparently, Elon Musk does know how to pull out.

Not properly obviously he signed the contracts if past cases are any indication he is going to be forced to buy it. To follow the analogy in about 9 months of lawsuit he will have to pay up.

- - - Updated - - -

Prob but I hope they leave with pennies on their theoretical value. Tech people that work in those industries are parasites and hope we buy their assets to cash out. If Elon Musk can do good in the world is humble them

So you are predicting twitter is going to be bankrupt in a few months? hope you are putting money on that because you would become a billionaire in that case. Also Elon is a vulture capitalist he is worse than those guys you are getting a boner thinking they could get screwed.

[D Luniz]

feel like this is a "Pump 'n Dump" scheme that got way out of control

[Ripster42]

So you are predicting twitter is going to be bankrupt in a few months? hope you are putting money on that because you would become a billionaire in that case. Also Elon is a vulture capitalist he is worse than those guys you are getting a boner thinking they could get screwed.

I don't think you know what a vulture capitalist is. That's not what muskrat is. He's just a standard capitalist who engages in illegal stock manipulation. A vulture capitalist practices a specific type of acquisition: buy companies, sell off bits of the company, take on debt, extract the money from those sales and debt via exorbitant dividends/consulting fees/c-suite salary, declare the company bankrupt and walk away.

[Fantomen]

I'm more likely to believe he was manipulating things.

What (illegal) manipulation is worth the risk? What will he gain? Compare to that he can gain several billions by shut up and not rock the boat, to give Tesla stock a possibility to recover from his latest controversy(s) Remember he gain atlest 1 billion, the Tesla stock gain 1%

[hellhamster]

Why? If (andf I say if) he manages to pull out, he have proven that somthing was wrong with Twitters number. So the fraud charges will be aimed toward Twitter and not him.

I'm not an expert, but tanking the stock price for personal gain (ie future acquisition) is fraud.

I still believe that Twitter isn't even remotely in Musk's agenda, he just used it to sell Tesla stock before the S&P 500 took a shit.

[Fantomen]

feel like this is a "Pump 'n Dump" scheme that got way out of control

Tell me what stock is he "Pump 'n Dump" ?

[hellhamster]

Tell me what stock is he "Pump 'n Dump" ?

Twitter. He definitely did some scalp trading. He might even have been the sole reason Twitter went up and down over 20% in a month.

[Endus]

feel like this is a "Pump 'n Dump" scheme that got way out of control

It's the opposite of a "pump n dump". A P&D involves boosting the price of a stock to an unreasonably high point somehow (the "Pump"), so you can divest all your own stock at that high price (the "Dump").

Musk was trying to devalue Twitter stock so he could apply pressure to make the sale go through.

This was more akin to what's known as a "poop and scoop", which gives us an opportunity to legitimately say "poop" in informed discourse and therefore is way more fun that "pump and dump".

[Fantomen]

I'm not an expert, but tanking the stock price for personal gain (ie future acquisition) is fraud.

So you do not know? I ask you one more time, to what gain? What is the reward compare to the risk of doing illigal manipulation.

I still believe that Twitter isn't even remotely in Musk's agenda, he just used it to sell Tesla stock before the S&P 500 took a shit.

He do not need to "buy" Twitter to gain the ability to sell his stock. He can do it anytime he want (as long he fill in the paperwork in advance) Are you jealous that he did sell and you did not?

[uuuhname]

LMFAO, I too am very jealous of not having so much money I can lose billions of it because I'm a dumbass and not be personally affected by it.

[Fantomen]

Twitter. He definitely did some scalp trading. He might even have been the sole reason Twitter went up and down over 20% in a month.

But he have not sold Twitter stocks after the initial buy. If you tell me he is using underling, I still have to ask to what end? The reward is not worth the risk, then he can gain billions by shut up.

[Forogil]

It seems that people have forgotten Hanlon's razor: "Never attribute to malice that which is adequately explained by stupidity".

The simple explanation is that Musk decided to start buying Twitter sometime before early April, thinking that he was the top of the world - and every big player need their own media-platform, and that nothing he did could go wrong. He skipped the usual due diligence, and didn't think that the stock prices in general would start declining further (they had already declined a bit - perhaps he thought they would soon start increasing again and wanted to move quickly).

DowJones is down about 10%, Nasdaq about 20%, and Tesla about 30% since he signed the deal. That's what causing him to get cold feet - that he tries to hide - since he rather be seen as evil than as stupid. Obviously he might be both.
However, he also did a semi-smart move by selling Tesla options to finance this - diversifying is good, diversifying into just one specific company with unclear future isn't that smart.

If he had adequately planned a pump'n'dump it would have made sense to do the usual due diligence, and "discover" something causing him not to sign - or actually add some conditions that couldn't be met, instead of trying to add them afterwards.

[hellhamster]

So you do not know? I ask you one more time, to what gain? What is the reward compare to the risk of doing illigal manipulation.



He do not need to "buy" Twitter to gain the ability to sell his stock. He can do it anytime he want (as long he fill in the paperwork in advance) Are you jealous that he did sell and you did not?

What the fuck am I reading and why aren't you getting what I'm saying?

I'm not repeating it:

He can sell his Tesla stock for liquidity. If he sells billions at once to acquire Twitter, he won't spook his own shareholders. Note that the Tesla price was high during that time. He sold his Tesla stocks, got liquidity and the price tanked in the coming weeks.

Suppose he got Twitter shares. We don't know when he bought and at how much, we can't trust what he says. The price of Twitter shot is up, then came back down, probably paired with the rumor that Musk wants to pull out, as well as general fear in the tech markets.

Let's say he sold $5 billion worth of his Tesla shares. He could have bought Twitter at $35 for $5 billion worth. Price shoots up because of the news of Musk buying it, he sells at €50. He now has $7.1 billion, $2.1 billion in profit. With that $7.1 billion, he can now buy back Tesla stock at 25% discount.

He begins with $5 billion/$1000 Tesla share = 5 million Tesla shares, and ends up with $7.1 billion/$750 Tesla share = 9.46 million Tesla shares.

He almost doubles his Tesla position with 3 mouse clicks, using influence and manipulating good and bad news to pump and dump the price to his liking. That is fraud.

[Fantomen]

$2.1 billion in profit.

Now tell me why will Elon do fraud to gain 2.1 billion, then its "coffee money" for him, he gain more value by shut up and not rock the boat.

That is fraud.

You "I'm not an expert" can see it, so can IRS..... hence nobady will do it as you discribe it.

[hellhamster]

Now tell me why will Elon do fraud to gain 2.1 billion, then its "coffee money" for him, he gain more value by shut up and not rock the boat.



You "I'm not an expert" can see it, so can IRS..... hence nobady will do it as you discribe it.

There is nothing wrong with him buying and selling, however if it can be proven that the price fluctuations of Twitter stock was due to him announcing an acquisition, and then withdrawing, with him making a profit from said fluctuations, then this probably counts as fraud.

I think in this case, it might prove a big if. I mean, I can see it, but can I prove it? No.

- - - Updated - - -

Another thing that I kinda forgot, which is what Musk is counting on if my pump and dump theory is correct, is discovery. If Twitter take him to court, Musk will justify his exit strategy on Twitter's false bot numbers. If he can prove through discovery that they did this deal in bad faith on Twitter's behalf, he will probably settle for peanuts, and might not even face fraud charges. This is the justice system after all, way worse things than this have happened.

If that happens, Twitter will be dead. Twitter stock will be hot garbage, no investor will want to hold that once the bot numbers are proven to be way much than reported. If Musk is indeed smart, he will have planned this to set up a rival platform of his own, assuming he can walk away from all the litigation that will be coming his way.

I also believe that there has to be something else in the contract he signed that can help him pull out with minimal cost attached. Even if that costs him $2 billion, he will have made a minimum of $10 billion through this ordeal. He will then only have the stock manipulation charges to worry about.

[Forogil]

Now tell me why will Elon do fraud to gain 2.1 billion, then its "coffee money" for him, he gain more value by shut up and not rock the boat.

Perhaps because he is stupid and lacks cash? (And 2 billion still isn't coffee money; I would say that coffee money is a lot less than 0.1% of your wealth.)

His alleged wealth has largely locked up in Tesla and SpaceX shares, so he hasn't had much cash (yes, he has even stated that himself). I write alleged since it is mostly on paper - if he actually tries to convert those shares into cash the value of those shares would drop a lot, as has been shown by this Twitter-affair.

So, regardless of whether he lost 2 or 10 billions he might still have gained liquid assets; and liquid assets are actually needed - especially if he has loans (as seems to be the case).

But I still don't understand that people keep claiming that it was some amazing plan by Musk. The fraud I see is him buying Twitter while failing to disclose it - but without any coherent plan.

[Zan15]

What the fuck am I reading and why aren't you getting what I'm saying?

I'm not repeating it:

He can sell his Tesla stock for liquidity. If he sells billions at once to acquire Twitter, he won't spook his own shareholders. Note that the Tesla price was high during that time. He sold his Tesla stocks, got liquidity and the price tanked in the coming weeks.

Suppose he got Twitter shares. We don't know when he bought and at how much, we can't trust what he says. The price of Twitter shot is up, then came back down, probably paired with the rumor that Musk wants to pull out, as well as general fear in the tech markets.

Let's say he sold $5 billion worth of his Tesla shares. He could have bought Twitter at $35 for $5 billion worth. Price shoots up because of the news of Musk buying it, he sells at €50. He now has $7.1 billion, $2.1 billion in profit. With that $7.1 billion, he can now buy back Tesla stock at 25% discount.

He begins with $5 billion/$1000 Tesla share = 5 million Tesla shares, and ends up with $7.1 billion/$750 Tesla share = 9.46 million Tesla shares.

He almost doubles his Tesla position with 3 mouse clicks, using influence and manipulating good and bad news to pump and dump the price to his liking. That is fraud.

If he did that you would have seen his SEC submissions by now because of the size of ownership changes.

That's how we knew he sold Tesla stock to fund the twitter purchase.