Furious Fridays

Elon Musk, Tesla and how CEOs affect share price

Today we’re talking about the markets, how CEOs affect share price and how public perceptions can make or break.

We look at Elon Musk.

Musk is a business magnate, investor and engineer.

  1. He is the founder, CEO, and lead designer of SpaceX;
  2. Co-founder, CEO, and product architect of Tesla, Inc.;
  3. Co-founder and CEO of Neuralink; and co-founder of PayPal.

 

 

  • In what has been a pressure-filled year for Tesla, the company’s third-quarter performance might be its most important test in 2018 – Musk said it will be great – “most amazing quarter in our history.”
  • But – JRE – Musk was filmed drinking whiskey, briefly smoking marijuana
  • It was the latest in a string of unconventional behaviour and bizarre acts by the billionaire
    • He has a very high IQ – Those people can come across as bizarre to some who don’t have high IQs
  • Even before Musk’s surprise August 7 tweet that he had funding “secured” for a go-private deal, Tesla had been under scrutiny from investors,
    • Analysts and short-sellers – it works to hit production targets and slow its cash burn.
    • Constant pressure from shareholders and analysts regarding near-term performance
    • He has said he wants to preserve a broad ownership of Tesla as a private company. That might be impossible for the mom and pop investors in the stock now who don’t qualify to invest in private companies as accredited investors. If they want to keep their ownership, it might have to be through a special purpose fund, something Musk has mentioned.
    • “Issues around regulatory approval – unclear how Tesla will allow retail investors who are not accredited investors to own stakes in a private Tesla

Musk stunned investors a month back with tweets saying he had funding to take the company private for $420 (A$589) per share.

  • Several followers questioned if it was against the company’s policy, while others mocked the CEO’s initial $420 bid, a number that has become code for marijuana
  • He then backed off from his plan, saying Tesla was better off as a public company.

 

Taking a company private – how it’s done

  • Simply going dark is a multistep process.
  • The exchanges need several days’ notice of the plan,
  • The public has to be informed at the same time.
  • Forms are filed with the regulators, one to notify it of the delisting and another to deregister the shares if the company has 300 or fewer shareholders.
  • Going private requires cash to buy out the minority shareholders, usually through a merger, tender offer or reverse stock split.

 

 

The mother of all f**kups – Assumptions and their unintended consequences

Welcome to Finance and Fury, the Furious Friday edition Going to run through the last part of the Lucky country – and that is how we can best turn our luck around Through – innovation, freedom of choice, and ignoring narratives based on assumptions Going to skip...

Furious Fridays: The Devil giveth and the Devil taketh away

Furious Friday The Devil giveth and the Devil taketh away Welcome to Finance and Fury! If you haven’t listened to last Friday’s episode go check it out, it’s a prelude to this episode. Today we are going to discuss the founder of Communism – Karl Marx, along with his...

Furious Fridays: The Death of Stalin

Furious Fridays The Death of Stalin Last episode we ended with Lenin’s death. The roll out of Communism was well underway and it was time for new leadership. One his last policies before he died in 1924 was the New Economic Policy (NEP) in 1922… A mixed economy put in...

How do we reduce poverty?

Welcome to Finance and Fury, the Furious Friday edition. This week is a flow on from last week’s episode talking about the basics of supply-side economics. But, it’s going to be applied to a question we got from Nick. What is a solution for society that would...

How I buy shares – the horror stories and the happy endings, plus technical vs fundamental analysis

Say What Wednesdays How I buy shares - the horror stories and the happy endings, plus Technical vs Fundamental Analysis Welcome to Say what Wednesday Today's question is from Emma. She says, “I'm new to the podcast so not sure if you have covered this in the past. I...

Say What Wednesdays: Housing market history and lowering property prices sustainably in the future

Say What Wednesdays Housing market history and lowering property prices sustainably in the future Welcome to Say What Wednesday! Today’s question is about Labor’s plans to help with housing affordability. To answer that properly, I will spend today going through some...

Why do we look to be in a Property Bubble?

Welcome to Finance and Fury, the Furious Friday edition. Today we have a pretty good episode! (I find this interesting at least, so I hope you do too) – We’re talking about the Australia Property market, specifically the property bubble. How monetary policy has...

Furious Friday: How do we avoid the decline into a recession?

Welcome to Finance and Fury the Furious Friday edition Today we are continuing the discussion around supply-side economics We will talk about the best ways to avoid declining into a recession as an economy and some solutions for economic growth. Last Friday we talked...

How does the share market’s behaviour changes with investor theory?

Welcome to Finance and Fury, The Furious Friday edition Today We will go through how the share market changes with economic theory, particularly the theory of Milton Friedman in regards to shareholder value and certain volatility The share market behaviour changes as...

What will the Paris Climate Change Agreement do?

Welcome to Finance and Fury the Say What Wednesday edition. Today we are continuing on from last week’s episode about climate change, so if you haven’t heard it, check out last week’s episode here. Today I will run through the Paris Climate Agreement, and their...

Pin It on Pinterest

Share This