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Short-Sellers Sue Tesla After Musk's 'Going Private' Tweets (bbc.co.uk)
An anonymous reader quotes the BBC:
Elon Musk's bombshell announcement that he is thinking of taking the electric car company Tesla private has landed him a lawsuit from unhappy investors.... His comments caused the share price to shoot up 11% to nearly $380, though it has since fallen back. Short-sellers, who bet on share price falls, allege he misled the market....
Short-sellers, who make a profit by borrowing shares, selling them and then buying them back at an expected lower price, claim to have lost millions thanks to Mr Musk's comments. Plaintiff Kalman Isaacs alleges the announcement was aimed at "completely decimating" short-sellers. His lawsuit, and another filed by William Chamberlain, accuse Mr Musk and Tesla of violating federal securities laws and artificially inflating Tesla's share price. Neither Mr Musk nor Tesla have commented on the lawsuit, which was filed in a federal court in San Francisco.
Tesla "is holding early discussions with banks about the feasibility and structure of a possible deal," Bloomberg reported yesterday -- and Ars Technica points out that if Mr. Isaacs had simply kept his short positions open through Friday, "he would be at least $60,000 richer."
But Isaacs' hopes to be the lead plaintiff for a class-action lawsuit "representing all Tesla shareholders who traded after Musk's tweet on Tuesday or at any time on Wednesday."
Short-sellers, who make a profit by borrowing shares, selling them and then buying them back at an expected lower price, claim to have lost millions thanks to Mr Musk's comments. Plaintiff Kalman Isaacs alleges the announcement was aimed at "completely decimating" short-sellers. His lawsuit, and another filed by William Chamberlain, accuse Mr Musk and Tesla of violating federal securities laws and artificially inflating Tesla's share price. Neither Mr Musk nor Tesla have commented on the lawsuit, which was filed in a federal court in San Francisco.
Tesla "is holding early discussions with banks about the feasibility and structure of a possible deal," Bloomberg reported yesterday -- and Ars Technica points out that if Mr. Isaacs had simply kept his short positions open through Friday, "he would be at least $60,000 richer."
But Isaacs' hopes to be the lead plaintiff for a class-action lawsuit "representing all Tesla shareholders who traded after Musk's tweet on Tuesday or at any time on Wednesday."
i made a investment and it didn't pan out. guess i'd better sue
Short sellers pissed off that the share price went up? let me see if I an find something small enough to hold the sympathy I feel for them.
SJW n. One who posts facts.
I would be laughed out of town.
For misleading me deliberately.
It is so tiny I can't find it anywhere...
I'm not experienced in the stock market so I may need an aid. Pull out that guarantee from your pocket and let's go over the language together...
Making materially false public statements about your own company is a securities violation...
he said he had secured financing for going private
he hasn't
end of story
one tweet to many for Muskie
This is a trick that Elon Musk can only pull once. If he doesn't take the company private, his move will be seen for what it was, a desperate attempt to shore up stock price by putting out the rumor that he was "thinking about" doing something.
If the company doesn't go private, those short-sellers will have their revenge. Consider: If you were thinking about taking a company private (which means buying up stock), would you make an announcement that will raise the price of the stock so you have to pay more?
Musk is trying to buy time for Tesla. That's cool, but he's skirting a fine line. It'll be interesting to see how this plays out, but I assure you there are people at the SEC looking into it.
You are welcome on my lawn.
The Tesla short sellers have been doing everything they can including fake announcements, generating rumours and harassing employees, suppliers and investors in order to hurt the share price of Tesla are now upset that Mr. Musk has said enough is enough?
Mimetics Inc. Twitter
Before everyone starts attacking short sellers, they actually provide checks and balances against bubbles and fraud.
https://www.investopedia.com/a...
https://money.usnews.com/inves...
You gambled, you lost, fuck off.
they're basically our ruling class. Things you wouldn't think in a million years have laws do. And those laws have teeth and they are enforced. It's good to be the king.
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Just can't stop thinking about how this played out... Musk: "I've been thinking about taking Tesla private" (yeah, if I could afford it.) andd... the stock price jumps for a bit and the short-sellers get thrown off. Ya know, every now and then we get dealt a really kick-ass hand and raise. Then that fool over there raises you and you're like "Yes!" next thing ya know you're all in. There was a reason they kept up with ya and you're left like... wtf Seriously? When you gamble even with the best hand you may just end up splitting the pot... Talk about some sore losers. Their like "What? You bluffed and we folded... Nope, nope we want our money back!" what a joke.
Do Colorless Green Ideas Sleep Furiously?
I've been making very nice bank lending my TSLA shares to Mr Isaacs and his fellow travelers. I'd just like to say thank you. Happy to do business with you any time.
boycott them, to the moron and to Tesla.
Seriously, these ppl hope to manipulate the hell out of Tesla stock and are upset that Musk announced the private stance PRIOR to their finding out. Yeah, they lost money, and now, they want to blame somebody else for their fuck-ups. No doubt Chanos has a LOT to do with the shorters esp. pushing these lawsuits.
I prefer the "u" in honour as it seems to be missing these days.
There's this big obvious income source coming for the company, an expensive factory being made that will make the next technology that everyone wants.
Without a disinformation campaign, folks would see that income source, and trade to match expected values, tempered for obvious risks, like failure rates and competition.
So, how do you turn this big, obvious market event in your favor?
You spread as much garbage about the company as you can. Headlines - headlines everywhere about everything you can get anyone to believe, that the company is fated for a giant fall. Get those stocks to as low a value as you can - then buy them, just before the actual numbers come back about a factory doing what a factory does.
So... the guy in charge of said factory decides to make the thing private, to prevent your strategy from working! Aw! All that work trashing the company, and you can't benefit from it! Such a loss of potential!
That's the market, as it is currently allowed to function. Folks using every piece of information as pivots to fool other investors.
The same thing is happening with Square Enix - about to release like 5 major games after working several years on each, and just releasing another major game now. What do the stories say about this, just before?
https://wccftech.com/square-en...
That's right - they emphasize the losses from making those games. They want those values low, low, low.
It's kind of a stupid way to value things, isn't it?
Ryan Fenton
I've given up trying to keep track of how many times I've seen the Musk haters say "Musk has screwed the pooch this time", "Musk has yet again promised and not delivered" or "Musk doesn't know what he's talking about" only to be proven wrong. If you're so sure that Musk does not have have a plan with investors lined up and has made the announcement without talking to tax attorneys and has placed himself in legal jeopardy could you put your money where your mouth is?
Mimetics Inc. Twitter
People got bored of magic internet money so went playing with meme stocks instead. Same tulips different field.
Musk has to keep the price above $360/share, otherwise he has to pay back bondholders $960M in cash by March 1st, 2019. Based on its current cash position and expected expenditures Tesla wont have the funds to pay bondholders back.
https://seekingalpha.com/article/4196101-elon-musk-desperately-needs-tesla-stock-stay-360
Short-sellers, as well as other types of speculators, are parasites of the financial system. They are the very reason you can't have a free market without regulation.
They should be treated exactly the same way we treat our other types of parasites.
Investors like to trumpet the importance of the liquidity they bring to the market. Its a hard to explain with a straight face what benefit short selling offers to society.
I suppose you could say it encourages investment by people who are betting on a company's rising stock, but in reality its really just high stakes gambling where the odds can be skewed by leaks and false information.
The antics of these people damages companies and the benefit to society is far outweighed by the horrible consequences.
Greed is the root of all evil.
what proof do you have that he did not secure funding? The fact that you are posting as an AC indicates that you have the veracity of Chanos or many others here.
I prefer the "u" in honour as it seems to be missing these days.
As long as they got your money, they would be happy to keep you around.
I prefer the "u" in honour as it seems to be missing these days.
They should call the bond now.
Because if he did secure funding he would have done it.
You know, be about it, not talk about it.
Something musk and his fanboys know nothing about.
he said he had secured financing for going private
he hasn't
What makes you think he has not? There are a lot of powerful people who want to help and hurt Tesla. Its a lot of money, but I have no doubt that there are people eager to get in on a potential bonanza of a privately held successful Tesla.
He was already facing SEC action, but I'm confident he'll be exonerated.
Greed is the root of all evil.
And having a smaller amount due in march might be a more workable situation.
he has to get the board and our approval for that. We stockholders DO have a say.
I prefer the "u" in honour as it seems to be missing these days.
Trading was always sort of gamble, any deterministic outcomes consistently are prosecuted as "insider trading". Lots of silly stuff affect stock prices and we can't expect people like Musk to be constantly self-conscious about affecting stock price in any way. I don't think forbidding Musk to share his plan to go private is in any way consistent with rule of law.
what proof do you have that he did not secure funding? The fact that you are posting as an AC indicates that you have the veracity of Chanos or many others here.
What proof do you have he did? As of now, of course none of us know. There are serious doubts because evidently his board wasn't even aware and nobody seems to have a clue who the investors are, and Musk isn't saying who they are. This is a huge amount of funding for nobody to know about so there are legitimate questions. Proof isn't required of course to file a lawsuit, but it will be required one way or the other to resolve it.
The SEC will review and we'll find out. It may all turn out to be noise, but the fact that all this came down at all could have been avoided had Musk been a little smarter about what he tweeted and when. It was a blunder.
It's been a few days and Musk has shown no proof and no one has come forward to say that they are the ones ponying up the money because Musk did in fact say that the funding was secured.
The SEC is investigating.
And let's face it, Musk is full of it many times. He bullshitted and said that Tesla wouldn't need a cash infusion this year and then $2 billion is pumped in by the Saudis last week for equity; which was needed because Tesla was yet again on the brink of insolvency (its got some serious cash flow problems).
He claimed he'd make 500,000 cars in 2018. Good luck with that.
And then there is all the other promises and assertions he made and then missed and the changing of goals to appear that he's meeting expectations. 500,000 cars in 2018.
Of course any rational person takes what Musk says with a hefty grain of salt. And when his bullshit is called, those people are called "trolls" and "haters" by his almighty Musk and his legions of followers fall in line.
Now, you fanboys and girls just make excuses and ignore reality.
Musk is bullshitting - but I'm sure he'll have some lameass reason or lameass solution that all of fanboys/girls will swallow whole and give his almightiness yet another free pass. But delusion doesn't trump reality and those of us who actually understand accounting (like knowing how to do a solvency test on a company) and business actually know what is going and find your and other fanboy ranting humorous - especially when you parrot Musk's BS.
I dumped my shares at $365+ because I cannot deal with his almighty bullshit anymore. I wonder what the people at Fidelity are thinking right now? And I can see why Softbank wouldn't cave to Musk's terms.
In Musk's position, I would want to depose the short-sellers. Especially the ones behind a lot of the artificial bad publicity, and their business partners, etc. And now Musk gets to do that, without actually having to bring any suit against the shorts. At least, not yet. Once he has their depositions, maybe. Watch them attempt to avoid getting on the stand.
Bruce Perens.
I would be laughed out of town.
Unless you saw proof that they deliberately stacked the deck against you personally, and not Joe Schmoe sitting next to you.
(Which is the stance of the sort sellers - Not that I know if they have a valid point or not .. that's up to the relevant authorities)
I am Slashdot. Are you Slashdot as well?
So, you are repeating what I am saying.
Yes, we do not know. However, there are 2 interesting links. First 16 banks said that Musk never approached them. The second one has Saudi Arabia saying that they were not interested.
Considering all of Musk Silicon valley billionaire friends, it still remains possible. But even I have to say, that this does NOT look good right now.
I prefer the "u" in honour as it seems to be missing these days.
His board members have acknowledged he did not secure funding. Have you ever heard of Google? Give it a try, sweet pea.
Short sellers need to man up and own their bad financial decisions. When I make a bad investment, I don't start looking for people to sue.
If you can't handle the stress of losing a short sale, stay the fuck away.
Firstly, I'm really sorry that you lost all your retirement money betting against Tesla. That must suck.
Not really hahahahahahahah!!!!
Hahahaha... I think in modern regulations.. if the CEO and BoD of a company want to make import changes to their company, they need to get permissions from traders.... if it may cost the traders money, it will most likely be rejected.
If I had more guts, I think this is part of what I would call a get rich scheme on Tesla. I see this same pattern, on Slashdot, the idea that Tesla does something, stock goes up, the short sellers put more pressure on Musk, then he snaps, the stock falls, then something good happens, and it goes up, etc. I bought a few shares of Tesla, mostly because I believe in electric cars, and always waited after some "Musk is crazy" news to do so, and each time, they jumped right afterward. This one might be a bit more dangerous though, because from what I've read, Musk might be in trouble here. He may be a genius, or may not, but smarter people than he have gotten too arrogant and slapped by laws, whether they're rational or not. The only saving grace I'm hoping for is that Musk is rational enough to know that any benefit he would get from a misleading or false announcement would soon disappear once it's obvious there is no financing. The stock would plummet, the shorts would be excited, and Musk may be in legal trouble.
and when it turns out they don't, they sue. Gamblers deserve their fate. They already gambled when they bought stock, then they gambled again by short selling. No sympathy.
How about a moderation of -1 pedantic.
Yes, because in the land of Oligarchia, only a dozen or so institutions are allowed to control the world through capitalization. No one else has any say, so it's sufficient to simply ask the oligarchs.
Not in Tesla. They entered into no contractual or ownership position with Tesla/Musk and therefore have no recourse. They did enter into contracts with third parties willing to loan their Tesla shares. But unless these third parties had any influence on or inside knowledge of Musk's buy-back plans, they did nothing wrong either.
Play stupid games, win stupid prizes.
Have gnu, will travel.
If TSLA goes private, short sellers are going to be providing $20B of funding to help TSLA go private. All their positions will be closed and they won't be able to play the borrower's game anymore. It's odd that none of the stories trying to figure out where the money will come from seems to note this.
How about if the casino deliberately manipulated the cards so you'd lose? That's what the short sellers are claiming.
If it's true, and Musk was just playing the market... it just might be jail time for him. Honestly though, nobody goes to jail from Corporate America, they just give out fines.
Without short sellers, speculators pump the prices and then dump at profit. Short sellers - when competent - help fight pump and dumps by leveling the price movements.
That's basically it. Tesla is trading at over 11x book value: it has no profits, it's cash negative, it's ROE is a NEGATIVE 73%, it's debt to equity is over 243% - and keep in mind the debt has to be serviced, it's numbers are god awful!
And based upon the realities of the automarket and its energy business, there is no possiblity it could ever be profitable enough to justify its current share price.
That's it. It's not "hating" Tesla. It's just that many of us think Tesla is vastly overpriced and there has to be a correction.
But Musk takes that opinion as an insult: not as just a trade based upon market dynamics. And whenever one gets emotional about stocks, that's when you're headed towards ruin.
And looking at the option for Tesla, many many many Tesla longs have protective puts: they are in effect shorting the stock short-term. Very prudent I might add.
And aside from the fanboys and girls, the serious investors are concerned over Musk's behavior. If they get too spooked and start selling their millions and millions of shares, we'll see a huge crash that will make facebook's correction look like chump change.
Rest assured, I would expect a press release sometime Monday from Musk regarding the buyout announcement.
Last time I was in Vegas they gave me a winning hand.
The rest of the body was buried somewhere in the desert...
He is charismatic in the mould of Steve Jobs. He has a track record of delivering his promises (sometimes late).
He would have no difficulty borrowing tens of billions of dollars.
Maybe he shouldn't be able to borrow all that money, but as things stand everybody from angel investors to banks to governments will throw cash at him.
The short sellers saw that train wreck a mile away.
They comb over financial statements, analyze the industry and the potential market.
Here's a little homework intellectual thing to do: go to your favorite investment education website (Investopedia is the best I think), learn about things like "current ratio" and other solvency tests. Learn how to analyze financial reports and then look at Tesla's.
Also, learn about the methods of valuing stock. The CFAs love the discounted cash flow method, but there are others. Benjamin Graham wrote a few books on them and your library most likely has them.
Value Tesla. Even value it like its selling 500,000 cars a year. Go ahead - be as liberal with the future prospects as you want.
Now compare it to the other car companies - they are Tesla's peers - to get a reality check. I know, I know, Tesla is different because of Musk - he's an innovative disruptive genius and the other car companies are all run by retards - but it's good to see what others are doing.
I think you'd see where the short sellers are coming from.
That is great, but I was taught that two wrongs don't make a right. Then again if everyone was trustworthy there wouldn't be a stock market as it is today.
You aren't investing in a company when you're betting against it.
"Unhappy investors"? I'm not at all sure that short-sellers qualify as "investors".
"Pump and dump" tactics - buying a cheap stock, talking it up with false positive news stories and then selling it at a profit - are illegal. The reverse - selling a stock short and then making up lies about the company - should be equally illegal.
Which warning are you talking about Rei? The one in 2012? Or 2013? Or in 2014? Or is it the one in '15/'16/'17? Or the one at the beginning of this past July?
He threatens shorts so much that it's just become lame.
Because right now everyone in the finance industry is glued to their Bloomberg and Reuters terminals to see what big swinging dick is going to pull off the privatization that's going to set records for years.
This is highly unusual and doesn't instill confidence in the money people.
He may have had the backing but spooked the investors with his outburst.
Honestly though, nobody goes to jail from Corporate America, they just give out fines.
Wanna bet? Remember musk on your first day in prison, beat somebody up or become somebodies bitch.
What is the wrong for the short sellers? The pumpers push prices away from fair value. Short sellers correct it.
Saying two wrongs don't make a right is like saying police shouldn't use guns when going after violent criminals.
How about if the casino deliberately manipulated the cards so you'd lose?
Technically, they do that all the time. The long term statistics of the card games are such that the house always wins.
Even if that guy does go bankrupt, I bet he'll get to keep most of his nice things because socialism. He's still a lot better off than a fresh college graduate with a couple hundred grand in student debt.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
The victim mentality is so pervasive these days that people who gamble are suing when their gambles don't pay off. That's how gambling works assholes.
If this was said on his personal Twitter where does freedom of speech come into play? Trump has said thing too that have hurt and help certain stock market positions.
Nothing like getting Bre'r Bear to throw you in the Briar Patch, lol.
"No! Please don't take me to court and make me prove you're lying publicly!
"Please No!" :)
Lol.
I'm sure this won't go to court, as this is the short sellers trying to make it go back down before the contracts expire, if they can.
Truth isn't Truth - Guliani
Well, at this time, I think that it is fair to say that there are not too many institutions with 82 Billion on hand. Or do you believe that there are loads of ppl and companies that have 82B in cash?
I prefer the "u" in honour as it seems to be missing these days.
All short sellers should go and take a hike
and piss off. They only serve themselves.
In China they would be executed.
Liberty freedom are no1, not dicks in suits.
How are short sellers investing?
Prostitutes sue wealthy customers for the loss of virginity.
He only needs less than 1/2 of that amount. His share is around 20%. So take that off the top. The top five investors together are over 50%. (Do not quote me on that!) And he stated there will be a way to keep the current investors money. (Similar to what space x does). My guess is the *Most* that he will need is 41B and the least is 5B. Probably the final amount is a little above the middle of those two numbers.
Or do you believe that there are loads of ppl and companies that have 82B in cash?
I no longer think you're an investor in Tesla at all. I think you're lying about it.
You seem completely ignorant of Tesla's supermajority voting rules, and the actual stakes that will have to be bought out.
If they were looking at the cards and only giving you the ones they wanted the state gaming commission would be very interested.
Person A has 100 shares of tesla, and sells 50 of them for $300
Person B has 0 shares of tesla, and sells 50 (takes a short position) at $300, on the same day.
The great god tweets some brainfart and the share price rises to $370
Why does person B think he is entitled to sue? If he is, then surely person A had just as much right to sue?
In other words, they want to sue CEO for creating shareholder value. That one will be difficult to play.
is still on the Government, even for securities fraud (drug charges are about the only place where the gov't can put the burden of proof on you). Given the amounts of money involved it wouldn't be hard for Musk to prove he _believed_ he had the money.
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What proof do you have that he did?
You just have the bias ranting of a Musk lover.
China has lots of money, plus he's opening a factory there. Maybe they would like to own a/(part of) an electric car company. They are pushing electric cars quite heavily.
They are completely the other side of being 'investors'.
"Those people betting against my company? Yah fuck them!"
Not investors...
Was not familiar, so I looked it up: https://www.nytimes.com/2008/1...
Not to mention the $20B in short interest that will get closed out in a private sale.
The problem with your argument is that about a billion dollars of these shorts are 4-6 year shorts. This isn't a "The price is going to be volatile next week" bets, these are people who are bettinb Musk won't outbid the UAW v.s. those who assume he has.
The shorts have borrowed shares and sold them. Their problem is they have to buy them back to return them and they were hoping the price would go down so they could pocket the difference. This isn't investment, it is parasitism. They gambled and the share price hasn't gone down, that's life.
Share prices rise and fall on all sorts of information and I don't think Musk would have said what he did without having the finance secured and his tweet was to alert all of his actual investors of what he was planning. Shorts aren't in on this, they don't have any shares.
"I have the attention span of a strobe lit goldfish, please get to the point quickly!"
That only works if he can keep the price high until the 1st Dec when this comes due. Driving up the price this early for that purpose would be incredibly stupid, as the price can fall again within a week.
I think it's more likely that he's started believing his own pr (He appears to be getting more unstable in his tweets, pressure maybe?) and wanted to hurt the shorts. Maybe he thought he could get away with it, or figured the penalty would be worth it.
Elon's plan to hurt shorts could backfire spectacularly. While these action rarely end with a judgement, discovery could be a gold mine for shorts to take revenge. And if the sec does find against Musk, it's likely that this will end in settlement or judgement, right when Tesla has 920 million worth of bonds due in Dec.
It's a low probability, but that tweet may have set the ball rolling on Tesla's demise. I hope it was worth the momentary satisfication.
Or more likely, lending money so they can later seize assets when it inevitably goes bankrupt. Considering how close they are now to running out of money with a good economy for the wealthy, they should be terrified about the upcoming recession.
That article is wrong based on the underlying linked SEC report on on the notes, either the author didn't read it properly or didn't expect their readers to read it properly. The note holder has the option to convert to stock until a couple days before maturity; the base conversion rate is 2.7788 per $1000 principal (which translates to about $360), but the conversion rate is increased depending upon the stock price given in table 9.03(e), with more shares given for stock prices at the cutoff of $252.54 per share. It gives the same breakeven point on the March 1, 2019 at the prices per share between $252.54 and $359.87.
The timing and reporting issues are listed in 9.01(b), for the listed major company changes (like liquidation) Tesla has to give notification at least 30 trading days in advance.
Frankly, that article set off by BS alarms causing me to look at the supporting material, since it sounded like this conversion was structured as a bonus to lenders if the stock price went really high, not as a way to dodge unforeseen financing trouble years ahead of time. The note holder captures upside to stock prices above $360 from the conversion. Presumably they structured it this way to improve how much money Tesla got up front for selling the notes in the 2013 or 2014 timeframe, and they were willing to trade away some of the upside if the price per share went above $360.
Short sellers, though in principle the practice is legitimate, are typically a crowd of get-rich-fast schemers. The primary reason they are short sellers is not that they honestly believe a company will go down or is overvalued, but that prices almost always go down faster than up. If you want to make money quickly, you go short. If you want to invest and make money in the long run, you go long. Wait, it's even called like that, what a surprise!
Lots and lots of them are in it for short-term profit which is why they have stop-loss orders in place to bail them out if the market goes the other way. And they are often in with leverage, so that they make 10 bucks on every point that the price moves. Which, of course, is also true if the price moves the other way. So their stop-loss orders are often much closer to the current price than it would be for investors who are quite ok with having some up and down movement, because they are looking at the company behind the price and don't care about today or tomorrow, they care about next quarter or next year.
So short sellers are a) make-money-fast guys and b) volatile to price changes going against them. With that, yes they lost millions, I easily believe that, because they probably bought at $350, set a stop-loss order at $360 and were leveraged 10:1 so that the $10 upwards swing lost them $100 per stock.
I so much hope the case finds a judge who understands the stock market and flat out tells them to not play in the kitchen if they can't stand the heat.
They would have been absolutely fine if they would not play with so much leverage that they need tight stop-losses.
Assorted stuff I do sometimes: Lemuria.org
There is no such thing as "China". An investor would be a specific legal or natural person with an escrow bank account that has the money, and an agreement with Tesla.
Very few days over the past year has TSLA been above $360, so the way you have said it, it sounds like you are full of shit.
Are you sure you didnt mean to say something different? If not, why didnt you say what you meant?
Either very sloppy or very dishonest. Does it matter which you are?
"His name was James Damore."
The shorts weren't worse off than before the tweet... unless they were short so much that they got a margin call before the price came back down, in which case they deserve to lose for having such a massive position.
Hypothetically, if you thought Amazon stock was overvalued since you beleive the platform is so full of security holes that could make something like that happen, taking a short position would not be a bad idea.
If enough people agree and do that the value will drop closer to the 'real' value, lessening the shock should an actual hack occur. This may be slightly beneficial for Amazon but certainly is for the market as a whole.
Of course, simply announcing that you think it's full of holes would do the same thing without fleecing everyone you sold the borrowed stock to at full current price (that you honestly believe is way too high).
There is no such thing as "China".
Over a billion people would disagree...
obviously the demons of this world can do whatever they want. if it doesn't turn their way as expected they will find other ways to kill everything they want to kill.
Show me where saying "Actually, I might just take this private so that assholes trying to crash the company and profit out of doing so can't fuck with the future of myself, all my workers and the planet" is market manipulation.
An entrenched market ripe for disruption. I totally believe musk when he says that car business is hell. I'm wondering if he regrets not going for something different like electric scooters or total robot cars or some entirely new market. ... Anyhow, I sure hope he succeeds!
We suffer more in our imagination than in reality. - Seneca
You can't presume without evidence that something bad happened. ESPECIALLY when you're financially benefited by the lie you said. That's called fraud. Enjoy PMITA prison, retard!
Because, just like Airbus' negotiations with a competing bid to Boeing, the USA will use NSA assets to steal secrets for their side and claim this is 100% right and correct. What is the difference between China and the USA? China don't care about owning the world.
So since this has not happened, there is no pump and dump here, you fantasist shithead.
The stockmarket rose because the tax cuts meant that corporations could buy back shares, and that caused the price to go up, and the company was "worth more" because of nothing they produced. the profit was never real. yet you have not demanded a lawsuit against corporations for stock buybacks. Nor a change to share value to tie it to something "real".
Twitter isn't an official channel. It's no different than over hearing him in a rest room or cab and then calling all your buddies and taking an action. "thinking" is the key word, which means idea or opinion, basically removing of all doubt of action. If you can sue someone for tweeting "thinking [insert random action/task here]", then we open a hole precedent of dangers. Including impeachment of [insert gov pos here]. Musk is a genius and will play a big part in American/World history, which he already has.
That's ludicrous on so many levels. If this was a strategic stock goose, he'd have done it closer to the March 2019 deadline. A momentary surge based on false promises is going to be utterly erased by next March. A pending lawsuit is more likely to depress the stock than keep it rising. There's no way he'd be "forced" to do anything so far in advance of a deadline!
Tesla's been trending upward since the end of 2016, where it was sitting at $180 and was well over $300 before the surge, peaking on some days well over $360. While I can imagine he doesn't want to see the stock price tanking, he has no reason to artificially inflate it. Tesla reengineered their production lines over the past year, so for that period they weren't particularly profitable and the stock price fluctuated... but that's done with now. They're hitting production targets and shipping stock. There's no reason to expect their stock price to tank, and again no reason to goose it artificially now.
Finally the article is crap. Yes, the stock price of $360 is a magical break-even point. No, it's not a goal Tesla has to meet or else face cash repayments. When an investor writes an article about a company and declares possible intention to sell short, you really should take their information with a small pile of salt. Maybe they do want the stock to sell for more than $360 come next March, but by no means does that make them desperate in August.
The ambiguity of these insider trading laws has gotten so intense that it reminds me of the intellectual property situation that software has been in (which fortunately has been somewhat figured out by the patent office this decade). I understand why manipulating markets is not allowed, but if it turns out that Musk did something wrong by giving people *more* information, I think I'll be pretty fed up.
On top of that, the premise that he is being sued by short sellers ought to negate any standing they would have to be an aggrieved party. It's bad enough that companies can be sued for not making their stock go up, but to also have them be sued for making it not go down is not tenable.
Nothing you wrote contracts what's stated in the article so I'm not sure what point you're trying to get at. The purpose of having the shares about $360 at conversion time is so the bondholders convert to equity rather than demand payment, which allows Tesla to issue new shares as part of an offering rather than having to deliver cash. The bondholders can then immediately liquidate their shares on the open market and pocket the difference vs the implicit $360 collar of their conversion price. In other words, it becomes a stealth secondary offering for Tesla, which is much less harmful to them than having to do an official secondary offering.
Your post doesn't make any sense, sorry. The purpose of announcing the private offering is to get the price above where it's been trading. Try restating your argument, this time with more logic and less pointless anger.
Well. They weren't investors of Tesla.
You invest on something expecting a return. Since shorting a stock mean to have a sold position of it they weren't Tesla investors.
They were speculators. Speculating in a falling price. And they may be wrong. Which happens .
I had to make this post unnecessary complicated because while not investors in Tesla they may be seen as investors in a product which give you a return if Tesla performs badly.
As for whatever he did would be illegal. He's warning ahead it seem. I don't know but I kinda would assume not. But yeah he got them good.
Public communication can move mountains of cash. Just because most of us use it trivially, does not mean it cannot have real power.
refactor the law, its bloated, confusing and unmaintainable.
"Over a billion people" aren't coming to buy 1/10 of a Tesla share each, smartypants.
You know that they are necessary part of the ecosystem, but every time I watch them getting their asses royally kicked on National Geographics channel, I am having a fit of a Schadenfreude.
I do not believe in karma. "Funny"=-6. Do good and forbid evil. Yours, Oft-Offtopic Flamebaiting Troll.
No, the minor holders don't matter at all. They'll be sent a piece of paper from the management with a checkbox, a few will tick "Yes" on it and mail it back, but most will not do anything at all, and even if they did, it would not matter, because of the way voting rights are structured at Tesla.
In fact, Musk wants to shaft you - to dilute your share and get new capital in, which is more valuable to him than you.
If he cared about the current shareholders' interests, he'd have worked his ass off to deliver on his production schedule, and stay public.
But he squandered your money, and now he's after more. From someone else.
Sorry, but you seem really smart, so could you actually debunk that guy for me?
The fact that you are posting as an AC
Im not that AC, just some other AC, and I always AC because I am too lazy to remember a username and password for a site so worthless as Slashdot.
You have no idea what you're talking about.
Fist you are making a generalization about short sellers which is completely baseless (Same of longs). Various market participants have varying durations and beliefs about the worth of securities. Undoubtedly there are "traders" and "manipulators", and you need to look no further than the "LONGS" of various "crypto coins" to see that nefarious behavior simply "exists" and likely on both sides of the trade---that is to say, there are legitimate short positions that have done their research and concluded the asset is overpriced, Period.
Besides, short selling is actually quite dangerous to the short seller (and requires having a lot more conviction than going long). Why you ask? Because of the asymmetry of the risk/reward. Short selling has limited upside (you could, at best, come close to doubling your money; at worst you face unlimited losses). The opposite is true for going long (limited downside, unlimited upside).
Lastly, there have been noted frauds exposed by short sellers no thanks to imbeciles like you who blithely and ignorantly belittle short sellers without having an modicum of a clue about what you're talking about. Here are a few notable ones:
Noted short seller Jim Chanos exposed a little tiny fraud called Enron.
David Einhorn wrote an entire book (https://www.amazon.com/Fooling-People-Complete-Updated-Epilogue-ebook/dp/B004D4YO6A) documenting the decade-long insanity he had to go through (get sued by the company in the processes) to short a stock, and be proven right in the end.
And if you're keen on looking at a recent short that was proven to be a fraud; check out MiMedx.
If Musk is even considering taking the company private (and discussing it with banks is a pretty good proof that his is) he has a fiduciary duty to tell the shareholders about it. The short-sellers don't have a case.
"Grab them by the pussy" -- President of the United States of America
* - Short sellers (many being naked shorters, which is illegal) have been blatently atttempting to reverse pump'n'dump Tesla stock whilst staying just on the legal side of the pump'n'dump laws
*- Tesla stock has resolutely refused to crash despite the concerted PR attacks to allow those short sellers to make money
* - Authorities have not been investigating the pump'n'dump attempts.
* - Tesla makes an announcement which causes the stock to rise higher, making the short sellers' losses rise from High to Very High
* - so the short sellers respond by suing.
The interesting part is going to be when SEC investigations show how much naked shorting has been going on and who's been doing it.
I'll bet for every dollar of legitimate shorting that's been going on, the main movers and shakers have been engaging in at least $100 of naked shorting (which effectively means "potentially unlimited losses") and are now feeling the heat as their markers are called in.
It's hardly surprising that the article was written like that.
Seeking Alpha is one of the leading pump'n'dumpers behind the Tesla shorting mess.
They're gamblers. Period.
Actually, it reminds me more of a cartoon. Aqua Teen Hunger Force - The Meat Zone
Meatwad ends up being able to predict the future and, after a request from Master Shake, correctly predicts the winning lottery numbers 1, 2, 3, 4, 5, 6, 7 but Master Shake chose different numbers despite this and gets angry.
https://www.youtube.com/watch?...
In a world of the blind, the one-eyed man is king--and the two-eyed man is a heretic.
First, it seems to me that the claimants would have to be able to prove that the stock price would have otherwise gone down had Musk not made the statement.
Second, they would need to prove that his statement was made with deliberate intent to manipulate the stock price, rather than just a statement regarding his future vision for the company.
I don't think they have a snowball's chance in hell of doing either.
Hope Musk counter sues for expenses.
The increased conversion rate I was talking about matters for fundamental changes to the company, which delisting and going private like Musk is discussing should include. If he is planning to go private in large part as a response to this particular $920M of debt, then the breakeven price for conversion is even lower, the $252.54 I mentioned, and on an earlier effective date than maturity the conversion is profitable above $252.54, not just $359.87, based on the table in 9.03(e).
If he is just goosing the stock to go above $360 so note holders convert and it reduces his debt load as you and the article are describing, then he can do that at least partially before the maturity date, since the notes can be converted at least a few days before maturity, and there is a 5 day measuring period. But the note holders are the ones who retain the option to convert if things continue as normally, so I'm not sure what the plan would be for goosing the price this many months out if Musk is just BSing about going private and can't maintain high enough prices longer than momentarily. However, $360 breakeven price in the initial note offering might not even be right anymore, the conversion rate is adjusted in section 9.04 based on changes to the stock pool such as splits or dividends. I haven't been following Tesla closely so I couldn't tell you if any of the 9.04 adjustments are relevant.
I don't disagree with the overall point that Tesla may have cashflow issues and potentially financing troubles, but Musk wanting to go private has bigger implications beyond him just goosing the price above $360. Also remember that what we are discussing is past debt based financing that is maturing next year, it would be hardly surprising if instead of paying that all off with cash Tesla just issued more debt. We're not currently in a financial meltdown like in 2008-2009 (fingers crossed), so I'm not sure it is a good idea to get lost in the weeds about converting debt into equity around the $360 per share price point, when the overall issue remains that he has almost a billion dollars in liabilities coming due March next year regardless and the markets should be well aware of that fact.
Who said they were?
Want to borrow some smarty pants to cover your dumb ass?
Wrong. We own a few shares for our sons. We also have 10 kw solar City and 2013 model s -85. Big believer/supporter, but as to the stock, that was what our sons wanted, and I was not capable of reading technical stuff for most of the last decade. Iow, we bought it, but don't do much with it.
I prefer the "u" in honour as it seems to be missing these days.
Slim to no chance of elon using Chinese money to buy Tesla. It would cost him the company.
I prefer the "u" in honour as it seems to be missing these days.
Then you should try harder to inform yourself about corporate governance, and your rights as a shareholder in an LBO or MBO.
Nobody needs 82B in cash to make this happen, and you as a minority holder who will likely join in a minority disagreement to have your stocks converted to private stocks with shareholder agreements attached- really do need to know what's coming.
Frankly though- you'll do fine either way.
If you're forced to sell, you'll make an obscene profit, and if you're not, you'll have the option to- at an obscene profit.
Yet if you demonstrated to the NGC that the casino had manipulated the cards to give you a winning hand, the casino would face stiff penalties.
I would be amazed if China comes first.
About the factory everyone told you would be in China...
Which turned out to then be in China.