You're right, I didn't pay much attention other than a tweet that he wants to acquire Twitter. Doesn't mean my instincts are wrong. There are these things to consider:
1. Musk is not stupid: I don't believe for a second that Musk hasn't calculated this, or that he hasn't known he would lose money by backing out.
2. His motive is easy to comprehend: look how the Twitter stock price dumped over the last day (10%). That's a 10% discount from Thursday's market price, and a 25% discount from his original offering.
3. His timing is impeccable: markets are taking a shit right now, with more pain very likely in the cards for the coming weeks or months even. My prognosis is a red Monday, might even be a black one. I don't believe the Friday relief rally, I think it's to get better shorting entries. Twitter might even drop to the $30 region or lower in the coming months, that is a 45% discount for Musk.
He will lose a couple billion now, with the potential to save a dozen billion in the near future.
Last edited by hellhamster; 2022-05-14 at 09:24 AM.
That's a slightly different metric.
The majority of Trump "followers" were inactive; specifically 54% hadn't sent more than a handful of tweets for more than a year, and 75% had been inactive for 90+ days. If that is a bot, someone in India who was paid to sign up, or just someone that joined - sent out MAGA MAGA! and then lost interest isn't clear - and doesn't matter much.
That's why the headline says "Bots, Spam, Inactive, or Propaganda".
But fake followers is a slightly separate issue, as they only matter in a kind of dick-measuring contest of who has the most, and I don't see that it matters much for Twitter's financials.
The 5% metric were for active users, as active users matter for advertisers.
What I find interesting is what the potential law-suits (if Musk drops the bid) might uncover related to Twitter-bots praising Tesla
https://finance.yahoo.com/news/elon-...120003951.html
If Musk had some hand in that, and then "realized" that Twitter had a bot-problem (after the price had fallen), it seems massively hypocritical.Then, on the evening of Nov. 7, within a span of 75 minutes, eight automated Twitter accounts came to life and began publishing positive sentiments about Tesla. Over the next seven years, they would post more than 30,000 such tweets.
Musk is stupid, he waived his due diligence under the contract.
Musk can't back out of the deal he made, if Musk was a "Genius" he wouldn't have signed the contract.2. His motive is easy to comprehend: look how the Twitter stock price dumped over the last day (10%). That's a 10% discount from Thursday's market price, and a 25% discount from his original offering.
3. His timing is impeccable: markets are taking a shit right now, with more pain very likely in the cards for the coming weeks or months even. My prognosis is a red Monday, might even be a black one. I don't believe the Friday relief rally, I think it's to get better shorting entries. Twitter might even drop to the $30 region or lower in the coming months, that is a 45% discount for Musk.
Last edited by szechuan; 2022-05-14 at 12:22 PM.
A Fetus is not a person under the 14th amendment.
Christians are Forced Birth Fascists against Human Rights who indoctrinate and groom children. Prove me wrong.
To reiterate for the third time this thread:
1. Musk says he will buy Twitter for an exuberant amount, being liable for $1 billion should he back out.
2. Musk has second thoughts, says he will not accept a deal should x happen. He pays the $1 billion plus whatever lawyer fees and damages. Let's round it up to $2 billion. He will be like "Ooooh nooo. Anyway."
3. Twitter stock expectedly tanks by 10% after this statement, which is still 25% lower than Musk's offer.
4. Musk expects the markets to tank in the near future, bringing the Twitter evaluation even lower.
5. Musk gets to swoop up Twitter for half price.
6. That $billion he lost will be peanuts compared to what he gained.
This isn't genius thinking, it's pretty basic and if I thought that up in a nanosecond, so can Musk.
Last edited by hellhamster; 2022-05-14 at 12:40 PM.
It's not a decision for Musk.
Damages will be to be loads more then 2 billion.2. Musk has second thoughts, says he will not accept a deal should x happen. He pays the $1 billion plus whatever lawyer fees and damages. Let's round it up to $2 billion.
He can't back out of the contract.3. Twitter stock expectedly tanks by 10% after this statement, which is still 25% lower than Musk's offer.
4. Musk expects the markets to tank in the near future, bringing the Twitter evaluation even lower.
If he was a genius he wouldn't have signed the Contract. lmao.5. Musk gets to swoop up Twitter for half price.
6. That $billion he lost will be peanuts compared to what he gained.
This isn't genius thinking, it's pretty basic and if I thought that up in a nanosecond, so can Musk.
A Fetus is not a person under the 14th amendment.
Christians are Forced Birth Fascists against Human Rights who indoctrinate and groom children. Prove me wrong.
One blaringly obvious flaw in this plan is that Twitter's stock is trading well below his bid price, the market is not taking his bid seriously. Any movement in the company will be the natural flow of stock. If he was a "genius" he would not make the bid at all because he would know that the market would tank therefore get the stock at the low price to begin with and not lose 1 billion dollars.
Maybe, but I guess that he didn't know back in April when he made the bid that the stock market would dumpola in May and onwards after a hawkish FED meeting (FED's announcement of Quantitative tightening has everyone panicking). The S&P 500 is 12% lower than the time of the bid and will very likely continue to poop itself for the foreseeable future.
Last edited by hellhamster; 2022-05-14 at 03:58 PM.
The people who are going to sue him are not lightweights. These are trillion-dollar + hedge fund organizations and trillion-dollar Saudi prince lead fund. He can only hope he gets out with just a 2 billion dollar bill. They have a lot more money than Musk has, by multiples.
Musk owns 73,486,938 shares of Twitter which he brought in march when the stock was 33-38 a share. If he cuts the price he wants to pay for twitter by 25% and drives the cost down to 40 instead of 54 he loses over a billion dollars on his own direct investment held. Still up from when he brought but not by much.
Also the assumption is that he will be able to make the value of Twitter go up after he and his billionaire club owns it is suspect.
If he swoops up twitter for half price @ 27 ish, he then will be down almost 2 billion and lose almost a billion from his initial investment.
Doing this he runs a real risk of losing the support of the largest stock holders.
You think the top 2 holders who currently hold more stock each than Musk are going to support a buyout at 50% cut? What about the rest of the stock holders?
Buh Byeeeeeeeeeeee !!
Shhh, don't question. Musk smart. Elon-san is genius. Never makes a mistake. Except when he does then it was on purpose to troll/shitpost/own the libs. He totally didn't let his ego get the better of him after his first offer got laughed at.
Guy owes me 500$, too. My one Tesla share is getting hammered. Some of it is just the market being bad of course but I wonder how low it'll dip.
It is all that is left unsaid upon which tragedies are built -Kreia
The internet: where to every action is opposed an unequal overreaction.
It is all that is left unsaid upon which tragedies are built -Kreia
The internet: where to every action is opposed an unequal overreaction.
1) If the Twitter bord is NOT lying about the numer of Twittter users. They can force Elon to compleat the transaction, or pay 1 billion in fine. Both outcome is economically advantageous for the stock holders. They get money, or Twitter go back to its "normal" price but Twitter "earn" 1 billion.
2) If the Twitter bord IS lying about the numer of Twittter users. Then its time to pick up the torches and pitchfors (lawyers) and go after the Twitter bord.
I personaly think Elon did know, and use the "Twitter is lying" part to beat up the company to get a better price.
Except that they didn't wrote "less than 5% of users are bots, trust us", they wrote "we estimate that less than 5% of daily users are bots (well, somewhat more particular), but that is just an estimate and it may be wrong."
That's because they have competent lawyers.
If he knew that the users numbers were inflated and wanted to lower the price based on that, he should have asked for a better price earlier, or made it a condition of the purchase.
If you see a used car with some rust with a sticker saying it has some rust - estimated to be less than 5% of the surface, but you notice that there might be more rust, you don't first sign a contract to buy it without conditions, and then try to renegotiate based on the rust.
All of that is kind of irrelevant because this is simply not how this works, if Elon Musk wasn't trolling he wouldn't learn about this now or perhaps he is pretending to. He would have had his people do proper research and he has enough pull thanks to the amount of shares he owns to get plenty of data. You aren't supposed to be vetting a company now publicly it's a clear violation of NDA that I am sure he had to sign to view all of this. This looks like a man who made a mistake and is desperate to have an excuse to back out.