[HN Gopher] Elon's Out ___________________________________________________________________ Elon's Out Author : jaxonrice Score : 191 points Date : 2022-07-09 14:46 UTC (8 hours ago) (HTM) web link (www.bloomberg.com) (TXT) w3m dump (www.bloomberg.com) | anonu wrote: | Twitter feeds are pretty public, albeit expensive to buy the | firehose. Nonetheless, shouldn't a handful of motivated hackers | be able to answer the bot question?? | csours wrote: | The way I see it, the bot question isn't about "bots on | Twitter", it's about "bots, spam, and insincere people on | Twitter that annoy Elon Musk". That is, Elon does not enjoy the | flood of spam that he has to interact with. His experience as a | user of Twitter is poor. | erk__ wrote: | The issue here is that only twitter knows who they count as a | mDAU. So there could be a lot of bots that are simply not | included in their counts. | petilon wrote: | This article says Musk agreed to buy Twitter mostly as a joke. I | think there's a far better explanation. This wasn't a joke for | Musk because after agreeing to buy Twitter he proceeded to sell | billions of dollars' worth of TSLA stock, supposedly to finance | the purchase. Even for the richest man in the world that's not a | joke. | | I think a better explanation is that Musk offered to buy Twitter | as a cover for selling billions of dollars' worth of TSLA. | | Look at this story: https://www.wsj.com/articles/elon-musk-sells- | billions-of-dol... The headline is: "Elon Musk Sells $8.5 Billion | of Tesla Shares After Deal to Buy Twitter" | | Why does he need a cover? Because TSLA is way too overvalued. He | has to know that it is overvalued. Tesla's market cap is double | of Toyota, VW, Mercedes, BMW, GM, Honda, Ferrari and Volvo _all | combined_! [1]. If you sell stock while knowing your company 's | stock is way too overvalued, you're fleecing unsophisticated | investors. Pretending to buy Twitter provides a convenient cover. | | Musk pretended that TSLA valuation is reasonable. Musk even | called out Gates for shorting TSLA stock [2]. If he didn't have a | cover then Musk would look like a hypocrite for selling TSLA. | | In reality, both Musk and Gates sold TSLA, the only difference is | that Musk sold stocks he owned, but Gates sold borrowed stocks. | But Musk used buying Twitter as a cover, so he gets to pretend to | be morally superior. Even though both men sold TSLA, according to | Musk, Gates' sales means that he isn't serious about climate | change [3]. | | [1] https://companiesmarketcap.com/automakers/largest- | automakers... | | [2] https://nypost.com/2022/05/31/elon-musk-calls-out-bill- | gates... | | [3] https://www.businessinsider.com/bill-gates-shorting-tesla- | wo... | grecy wrote: | If that was his plan, what's he doing with the billions he now | has in cash? | 202206241203 wrote: | Trust funds for the next dozen of his babies? | bambax wrote: | This is alluded to at the end of the article: | | > _Is it fun for him? If he manages to walk away having spent | only millions in financing fees, millions in legal fees and say | $1 billion in termination fees, was it worth it? What did he | get out of this? The guy really seems to like being on Twitter, | and he did make himself the main character in Twitter 's drama | for months on end. That's nice for him I guess. Also he made | the lives of Twitter's executives and employees pretty | miserable; as a fellow Twitter addict I can kind of see the | appeal of that? I always assume that "everyone who works at | Twitter hates the product and its users," and I suppose this is | a case of the richest and weirdest user getting some revenge on | the employees. _He also gave himself an excuse to sell a bunch | of Tesla stock near the highs. _He maybe got an edit button | too? Maybe that's worth a billion dollars to him?_ | | But for that to be the sole reason of the whole circus is | conspiracy theory. | | > _Musk has buying Twitter as a cover_ | | It's a very, very annoying/distracting cover, not to mention an | expensive one. | [deleted] | akelly wrote: | If that was his plan, why didn't he put an out in the contract? | perlgeek wrote: | Because then the Twitter board wouldn't have signed it. | tptacek wrote: | That seems like an enormous amount of risk to take on just to | sell stock that he actually owns and avoiding "looking like a | hypocrite". It's not just plausible but somewhat likely that | he'll be forced into an 11-figure settlement with Twitter to | avoid the actual worst case outcome of being forced to take | custody of and actually operate Twitter until he can unload it | on someone else. | Strom wrote: | > _Because TSLA is way too overvalued. He has to know that it | is overvalued._ | | Indeed he does. He has talked about this publicly in various | interviews over the years. [1] | | > _Musk pretended that TSLA valuation is reasonable. Musk even | called out Gates for shorting TSLA stock_ | | Musk definitely really dislikes short sellers, no doubt about | that. However that is different from pretending that TSLA | valuation is reasonable. | | -- | | [1] A decent example is the 2021 Kara Swisher interview, where | he states _I have literally gone on record and said that our | stock price is too high._ https://youtu.be/O1bZg7frOmI?t=2450 | niklasbuschmann wrote: | Could Musk buy Twitter shares on the open market before the deal | closes? | t_mann wrote: | Can we also take a moment to appreciate the tongue-in-cheek | writing style of this (fairly thorough, by my impression) | analysis of rather dry things like SEC filings, merger | covenants,...? | dreamcompiler wrote: | This is why Levine's is one of a very few newsletters I | subscribe to, and I read it immediately when it arrives. He's | both entertaining and educational. I know a great deal more | about finance now than I did a year ago, and that's because of | Matt Levine. | dan-robertson wrote: | (Note that he writes a newsletter like this roughly daily, | though not ordinarily on weekends. It's is free to subscribe | to) | tyleo wrote: | Money Stuff is really good. Some of my favorites are right | around when GameStop started to spike. | calmoo wrote: | Matt Levine is fantastic, highly recommend subscribing to his | newsletter. | KKdU9EXbBhmLznR wrote: | > Would he line up billions of dollars of financing and sign a | binding merger agreement with a specific-performance clause and a | $1 billion breakup fee as a joke? I mean! Nobody else would! But | he might! | | What a silly thing to say. Of course he would; I'd also risk $20 | (~1/200th of my assets, like $1b is for Musk) on a joke, | especially if I knew I'd almost certainly never lose that much. | jp57 wrote: | Another hypothesis: Triggering a legal battle in the courts is a | delaying technique to push out the acquisition until the economy | rebounds (and Tesla and Twitter valuations with it), or until | after the 2024 election, because Elon realized that he doesn't | actually want to let Trump back onto the platform. (Perhaps | because he perfers DeSantis) | alphabetting wrote: | I found this part most interesting. Public awareness of the | Delaware Court of Chancery is about to skyrocket during this | court battle. | | _The fact that Musk is working in such bad faith here -- that he | seems so unconcerned with law and the contract he signed -- cuts | both ways. On the one hand, it will certainly annoy a Delaware | chancellor; Delaware likes to think of itself as a stable place | for corporate deals, with predictable law and binding contracts, | and Musk's antics undermine that. On the other hand it might | intimidate a Delaware chancellor: What if the court orders Musk | to close the deal and he says no? They're not gonna put him in | Chancery jail. The guy is pretty contemptuous of legal authority; | he thinks he is above the law and he might be right. A showdown | between Musk and a judge might undermine Delaware corporate law | more than letting him weasel out of the deal would._ | lkxijlewlf wrote: | Maybe this is a good reason a single human being shouldn't be | so fucking rich. | | If enough money makes you untouchable by the law, then our | system is simply broken. | bmitc wrote: | I continue to be super concerned about this. I do not | understand how the U.S. government does not view these | billionaires as serious ideological threats to democracy, the | court system, national security, etc. Makes one realize just | how bought out Congress is. | | Once a person has wealth over, say, $500 million, then there | should be a 100% tax. | rrrrrrrrrrrryan wrote: | According to the Laffer curve it should probably be 70% or | so to maximize government income, but yes. | | If you tax them 100% they'll just stop working or bail to | another country, and then you collect zero tax revenue from | them. At 70% most of them will just suck it up and pay. | | (I realize France is a counterpoint here, but I'd argue it | was a half-assed attempt, and they have neighboring French- | speaking tax havens that have no real U.S. equivalent.) | bmitc wrote: | Thank you for the reference to the Laffer curve. | PaulDavisThe1st wrote: | The Laffer curve is a fact-free zone except for at it's | two end points. | | The reality is that nobody knows for sure what the curve | of revenue vs. tax rate looks like other than at those | two end points, which makes the entire concept completely | useless. | double_nan wrote: | It's fascinating. Not only that is fact free, but it's | based on an assumption that the purpose of the government | is to collect maximum tax value from the citizens. Is it | thought? | tbihl wrote: | >Once a person has wealth over, say, $500 million, then | there should be a 100% tax. | | Your inability to conceive of a useful purpose for such a | quantity of money does not justify prohibiting its | existence. | | >I do not understand how the U.S. government does not view | these billionaires as serious ideological threats to | democracy, the court system, national security, etc | | Cooperation. A government that can't handle the idea of | powerful citizens has all the tools it needs to make almost | all those people (hard to banish all the Christian | missionaries, and martyring them is the surest way to grow | more) leave or fall in line, but I don't think many people | look at Venezuela or North Korea as ideal places to govern | in terms of democracy, the court system, national security, | etc. | bmitc wrote: | > Your inability to conceive of a useful purpose for such | a quantity of money does not justify prohibiting its | existence. | | What inability and where was it demonstrated? Are you | referring to a useful purpose if it was taxed or a useful | purpose for individuals to have such wealth? If the | latter, then I propose that an individual containing such | wealth is less useful than it being returned. | | Those things and countries you mentioned have nothing to | do with this discussion. | towaway15463 wrote: | It's rather ironic that a discussion of Elon Musk | prompted you to make that assertion. | tbihl wrote: | It's so many layers of delightfully nested irony. Give | more money to the federal government so they give more | big tax credits for Tesla purchases, but Tesla can't | exist any more in this fantasy world where nothing | outside of the federal government can grow beyond $500 | million in scope. | nightski wrote: | Meh the government doesn't need more money to conduct | frivolous and corrupt spending with. | | However it might be interesting to explore an option that | required people who own a stake in a company that has grown | beyond a certain size to be required to siphon off some of | those shares to employees over time in a way where it was | not conducted on the open market and would not affect share | price. | | I also question whether corporate entities should be | allowed to own shares and what the benefits are of that. | Should private investment firms be allowed to accumulate | massive stakes in public companies? | bmitc wrote: | I don't think we should avoid something just because | there are more problems. We should fix those other | problems as well. The primary issue is that there is a | single extremist party, not unlike those found in the | Middle East, that is hell bent on undermining America for | want of power. By systematically undermining education, | public health and services, infrastructure, treating | government projects as jobs programs, etc., they are | creating a worse America and a sort of political | Stockholm syndrome among their constituents. But there is | indeed corruption across the board in America. | | Local governments are starved for money, and almost all | of their funding comes from local property taxes, that | is, normal people. So, these mega-rich are allowed to get | unboundedly wealthy, while normal people have to pay to | keep society running as a minimal level. The mega-rich's | money, as well as corporations', needs to flow back | through the system. It does no good to let it concentrate | so heavily and ultimately do nothing while it sits there. | sokoloff wrote: | IMO, neither party excels on educational topics and both | 100% treat government projects as jobs programs. | [deleted] | nightski wrote: | Is it ironic I don't even know which party you are | referring to because it accurately describes both in my | opinion? | | But I disagree in that I think we absolutely should avoid | it because a larger federal government has been heavily | correlated with less local funding (so much so that the | SALT deduction was once a thing). It's given rise to | globalization and large multi-national conglomerates. It | creates a situation where power & money is too | concentrated. | bmitc wrote: | I'm not sure it's ironic as much as it is either not | paying attention or not being honest with the situation. | One party being extreme does not make the other party the | good party. It just means that one party is extreme, | which is a fact. The Democrats are not a paragon of a | political party. They are as inefficient, middle of the | road moderate, corrupt, etc. as any political party. But | the Republicans, or at least a powerful subset of them, | have become an extremist group. And they are well-funded | by conservative and libertarian ideologues who care about | nothing other than power and money and can use their | wealth to avoid any downsides in their quest. | | Once you start looking into the ideologies of people like | the Koch brothers, Robert Mercer and his family, Peter | Thiel, Richard and Elizabeth Uihlein, Sheldon Adelson, | Ronald Cameron, Steve Wynn, and others, you start seeing | very weird and strange beliefs that are incompatible with | a functional society. The primary thread is that these | people do not care about others. Just look at the Koch | brothers' political donations and the businesses they | run. Is it then any surprise why the Republicans might | not care so much about climate change and policies to | mitigate it? | | We have one extremist political party, and then the | other, somewhat incompetent, party spends all their | energy fighting back against the extremism of the other. | [deleted] | nightski wrote: | I just do not agree that one party is more extreme than | the other, sorry. I also don't believe you are being | honest with yourself over the situation either. It's | clear you have dug your heels into a particular set of | beliefs and have no interest in discussing real solutions | (instead just want to play the blame game). Frankly it is | just not interesting discussion. | bmitc wrote: | That can be your opinion, but I think it stands in | disagreement with several events and facts of the | Republican party. There are oodles of articles and books | addressing the growing extremism of the Republican party, | so I don't think it's even a controversial opinion. By | just saying "oh, they're just another political party | with different beliefs" is enabling their extremism. Any | rational discussion with a Republican, at least those | that I know, which includes family members, can often not | be had. I understand that there are actual conservative | political beliefs, but from what I can tell, they are not | the ones driving the power dynamic of the Republican | party. The discussions I have had quickly turn weird | because it quickly becomes a case of religion, sexism, | racism, or something else deep down affecting their | political beliefs, which mainly consist of wanting | everyone else to be like them and to do what they want | (how they want). | | A certain Republican sect literally tried to overturn the | presidential election, threatening to hang the vice | president, killed a capital cop, ransacked the capital, | and only one Republican had the guts to vote against the | president. Then that same party will decry people | marching for human rights and supports violence against | those groups. The Republicans are the same party that | supposedly stand for small government but are hell bent | on telling people what they can do with their own bodies | and forcing religion to be taught in public schools. | Republicans' reaction to mass shootings is more guns, | while they are the ones that block any investigation into | why these are happening or preventing people that should | not be buying guns from buying guns. I happened to drive | across the country during COVID. You could tell the | Republican states from the amount of masks being warn. | The Republicans blocked a third supreme court nomination | by a two-term president in Obama that was 10 months ahead | of the presidential election, meanwhile they rushed a | third supreme court appointee by a one-term president | just two months before an election, throwing out every | reason they used to block Obama's nomination. These are | all extreme positions that don't have analogs in the | Democratic party. | | > have no interest in discussing real solutions | | Mind pointing that out? In fact, I've elaborated quite a | decent amount. I'm not sure what you've brought to the | discussion other than just stating disagreement and | making bad faith statements. You are free to contribute | or elaborate on what you mean by the Republican party not | being extreme. | | The solutions I believe that could help things are: | increasing tax on the wealthy, limiting the amount of | political donations including to interest groups and | think tanks (i.e., get private money out of politics and | government), abiding by separation of church and state, | and increasing primary and secondary education. | MrMan wrote: | You are pissing in the wind. This place is essentially | r/conservative and most of these people are totally fine | with how things are progressing. I think the US is | completely fucked and no rich people I know care, at all | Stupulous wrote: | Yeah, this place is so conservative that you can't even | say that Republicans are extremists who are intentionally | undermining the country and that everyone who supports | them is suffering from a rare mental disorder without | people calmly disagreeing. /s | [deleted] | rlt wrote: | > Meh the government doesn't need more money to conduct | frivolous and corrupt spending with. | | I agree with that, but they could just, you know, _lower_ | taxes on the lower and middle class to balance it out. | dopidopHN wrote: | Or do something useful and somewhat efficient with the | money. Eg: good, reliable public school, roads, network | infrastructures, renewable energy sources. | | I'm a US tax payer since less than a decade. My | experience is that I pay a significant portion of my | incomes to taxes that only marginally benefit me or folks | around me. | | Recent uptick of direct distribution is nice. | | But a leadership in the stewarding of the land would be | tasteful and send the right message IMO. | | It's fascinating to see the Western European countries | I'm familiar with being blinded by the economic might of | the US but not realizing how little the average citizen | benefit from it. | BobbyJo wrote: | In very direct, real terms, assets are power. They represent | resources to do things. | | The problem here isn't that wealth is power, it will always | be power. The issue is that a single person has been allowed | to accumulate too much. | toomuchtodo wrote: | I appreciate that in such a short comment, you succinctly | summarize the problem statement. | avalys wrote: | Musk owns about 25% of Tesla, mostly after investing about | $50M in Tesla's early funding rounds. | | His wealth today comes largely because Tesla (under his | leadership as CEO) has become a company that investors now | believe is incredibly valuable, and they've driven up the | stock price. At what point in this process did Musk | "accumulate" this ownership of Tesla, and exactly what do | you propose should have happened to stop him? | BobbyJo wrote: | Musk has sold billions in stock at this point, so this | whole "it's stock that's increased in value independent | of Musk" line of thinking is a bad misdirection. | spullara wrote: | And every time he has sold he has paid huge taxes on | those sales. | camjohnson26 wrote: | It has become so valuable, more valuable than the rest of | the auto industry combined at one point despite much | lower revenue and sales numbers, because of loose | monetary policy by the Federal Reserve creating | artificially inflated asset prices. The Federal Reserve | is directly responsible for Musk's disproportionate | wealth as Tesla stock zoomed past ridiculous levels. | | Tesla has been successful in many of its lines of | business and succeeded when many thought they couldn't, | that is undebatable. The failure of our system is that | its stock price is completely out of line with the | reality that reflects that success. | nerdawson wrote: | > loose monetary policy by the Federal Reserve creating | artificially inflated asset prices | | You can buy shares in other car manufacturers. Why would | Tesla disproportionately benefit from inflated asset | prices? | Rury wrote: | Because Tesla is in major indexes like the NASDAQ | composite, and S&P 500, as well as many major/popular | funds/ETFs. Additionally, many funds are weighted by | market cap (so more expensive companies get even more | disproportionate investment). And the majority of stock | investment activity happens through these investment | vehicles today. | | Generally, anyone who puts money into a 401k, will likely | have some of it going to Tesla and disproportionately | over other auto companies - simply because how funds are | typically weighted. | camjohnson26 wrote: | Because car companies are boring, and in an era of cheap | money the meme wins. "Sexy" automakers also got insane | multiples, look at where Lucid and Rivian were trading. | But the capital is diverted to whatever asset people | think will keep going up, not the one that will create | value in the form of profits. This is also why GameStop, | AMC, DogeCoin, Shiba Inu, NFTs, Pokemon cards, etc. were | trading so high, the meme is the only thing that matters. | | Elon Musk knows this and is a master at harnessing this | power, which is why he's shamelessly pumped DogeCoin and | Shiba. He continually pushes his company to be the most | popular brands by promising impossible futuristic | products that cannot exist, but build excitement. | Countless examples of these, but a few are Full Self | Driving, a flying Roadster, the Tesla semi, solving | transportation issues with tunnels, the Tesla bot, $25k | model 3, solar roof that costs less than a normal roof, | robotaxi, etc etc etc. It's all calculated. | Nevermark wrote: | It would mitigate the problem if institutions could be | strengthened by design to be less sensitive to corruption | or special treatment. | | There are lots of successful examples - constitutions, | voting, term limits, separate judiciary, non-political | commuters, etc | | The big problem I see in the design of egalitarian systems, | is explicitly addressing the need for continuous response | to new forms of centralization. I don't know of any | significant systems that were designed with any explicit | statement of prioritizing that (vs. just general support | for fixes, amendments, etc.) | | For instance, the centralization of US political power into | only two parties, where (temporary) single party rule of | three branches is actually a practical possibility should | have triggered some major reforms before it spun out of | control. | | A simple requirement that no coordinated individual or | organization have sway over more than 25% of political | seats, and political organizations at the federal and state | levels must be separated, would do wonders for | decentralization and better representation. | | But the constitution is silent on any guidance or | requirement on addressing new power centralization | problems. | | It is the hard root problem of power, but not systemizing | progress on it is to accept inevitable dystopia | BobbyJo wrote: | I don't think the onus is on any one of us to come up | with fixes to a problem this large. The government | employs hundreds of incredibly smart people whose job it | is to fix these types of issues. I, and I think most | other people as well, would even be fine with small | corrections here and there that tested what worked. | | A fundamental problem, that we are all burdened to solve, | is how do we get from an ideological government to a | scientific one. Until we do that, we're all just plugging | holes in a sinking ship. | edgyquant wrote: | >A simple requirement that no coordinated individual or | organization have sway over more than 25% of political | seats, and political organizations at the federal and | state levels must be separated, would do wonders for | decentralization and better representation. | | and would be undemocratic | IX-103 wrote: | How is that? Popular parties would split to express a | wider array of views. | | Of course first-past the post voting systems won't work | here, but that doesn't make it undemocratic. | MrMan wrote: | This is a forum for white guys trying to become more | powerful, and who hate government or any limits on their | actions | BobbyJo wrote: | I'd like to see the data on that one. I think most people | here recognize that limits on individual power can | increase freedom. | | Such a reductive view, on any group, isn't productive. | kolinko wrote: | As someone who grew up in a communist country with literally | zero rich prople - it's not about wealth, it's about power | and influence. We've had just as many, if not way more, | people above law as in capitalist countries. | camjohnson26 wrote: | Putin is rumored to be the richest person in the world, but | of course you'll never see him listed on Forbes because he | hides it. | | https://fortune.com/2022/03/02/vladimir-putin-net- | worth-2022... | moomin wrote: | This is one of those things that could genuinely cause problem | for the entire US (corporate) legal system. There's a genuine | danger that the result of this case will be "some people are | too powerful to be regulated by the US system, and this is now | obvious". | arcanus wrote: | This is a cyberpunk future. | | I'm overall a fan of Musk, but this is too far. There simply | must be rule of law for the United States to remain a dynamic | society. | edgyquant wrote: | Literally there's not even a hint that Musk is above the | law yet you're calling it a cyberpunk future | moralestapia wrote: | >According to the U.S. Securities and Exchange Commission | (SEC), Stewart avoided a loss of $45,673 by selling all | 3,928 shares of her ImClone Systems stock on December 27, | 2001, after receiving material, nonpublic information | from Peter Bacanovic, her broker at Merrill Lynch. The | day following her sale, the stock value fell 16%.[49] | | Martha Stewart went to jail for 5 months for a meager | case of insider trading. Musk manipulated Tesla stock in | front of, literally, the whole world and got a slap in | the wrist (i.e. a fine that comes to about 0.1% of its | net worth). A citizen would to go jail forever for a | similar thing. | pacificmint wrote: | > Martha Stewart went to jail for 5 months for a meager | case of insider trading. | | I believe she went to prison for lying to investigators. | The insider trading they couldn't make stick. So in the | end, maybe the cases aren't so different? | towaway15463 wrote: | Facts. She also just paid a fine for the insider trading. | Her criminal case was due to conspiracy, obstruction of | justice and lying to federal investigators. | [deleted] | moomin wrote: | "Lying to a federal official" is one of the most BS | things in the entire US penal. It's practically carte | blanche to imprison anyone you come across. | v21 wrote: | There was that whole thing where a court said a lawyer | has to check all of his tweets, Musk shrugged it off, and | the court did nothing about it. | JaimeThompson wrote: | Smoking weed makes you lose your security clearance, Musk | did it on camera and still has his because of "reasons". | That is one example of the rules that apply to most | others not applying to him. | HWR_14 wrote: | > still has his [security clearance] because of | "reasons". | | Does he? I don't remember any resolution to that, but I | thought they "temporarily" suspended it pending an | investigation and then never completed the investigation. | towaway15463 wrote: | Probably also an example of a rule that should be | retired. Either that or they should remove clearance if | you enjoy whisky. | leetcrew wrote: | you're missing the point of the rule. the issue with | smoking weed isn't really about having impaired | judgement, it's that weed is still illegal at the federal | level. there are all kinds of low-level crimes that can | put your clearance at risk. which kinda makes sense... | they want the kind of person who strictly follows the | rules for cleared positions. | MrMan wrote: | What a legacy opinion. We are all about destroying | everything here | BiteCode_dev wrote: | That would be a good thing. Put some light on one of the | biggest failure of our democracies. | phatfish wrote: | US law obviously works in favor of billionaires. I doubt even | Musk would want to expose it further, and the other parties | involved in this deal surely don't. | | They will set their lawyers at it and come to a settlement. | The super rich know better than to be at each others throats, | that sort of behavior is for the poor... | lumost wrote: | History says that these people likely reside in | impenetrable bubbles. The idea that he is so special as to | avoid the court system sounds a bit like "let them eat | cake" as there is no bread. | dopidopHN wrote: | I have no insight into this but it looks that it will happen | eventually. ( the degradation of the US gov authorities on | the conduction of large financial arrangements) | KerrAvon wrote: | If this court doesn't have real power against clever C-suite | types, maybe it's better that we find that out. In terms of | compensation and personal money management, Musk isn't doing | anything that other wealthy execs haven't done. (For example, | Steve Jobs famously took a $1.00 per year salary for a long | time.) Either there's an enforcement mechanism that works or | there isn't. | tenpies wrote: | edgyquant wrote: | The fact your argument rests on a convicted billionaire is | pretty ironic | willcipriano wrote: | It's the billionaires that didn't get convicted that are | the problem. | | Lots of powerful people spent a lot of time on the lolita | express. | ALittleLight wrote: | I think it's more about the people who murdered Epstein | getting away without consequences or even an | investigation than the fact that a rich guy, eventually, | after repeatedly sexually abusing and trafficking | children for years, finally was facing serious legal | risks which he might've evaded. | MrMan wrote: | Mainstream media is too woke! It's all a conspiracy | haliskerbas wrote: | > There's a genuine danger that the result of this case will | be "some people are too powerful to be regulated by the US | system, and this is now obvious". | | This should have been obvious by now. Cash rules everything | around me. | HWR_14 wrote: | > Cash rules everything around me. | | Serious question: Are you in the US? Any Western European | country? | | There's a tendency for people in corrupt areas to assume | the whole world works like that. | hnbad wrote: | Not the parent, not just cash, but capitalism literally | means capital is (political) power. Just because you | don't bribe police officers with cash that doesn't mean | your political system isn't corrupt. In the West we just | find it more comfortable to talk about lobbying and | public-private partnerships instead of calling it what it | is. | typon wrote: | It's wild to me that people think that Elon might actually | face legal consequences for this. | | The Delaware court isn't some magical place run by elves. | It's a court in the US. You know what's a lot cheaper than | $34 billion dollars, or heck even $1 billion dollars? $200k | for 3-4 judges. | | The Supreme Court just changed the law of the land based on a | right-wing political campaign. You think a billionare, let | alone the richest billionare is going to be subject to any | serious consequences? It's absurd to even entertain this. | parineum wrote: | > The Supreme Court just changed the law of the land based | on a right-wing political campaign. You think a billionare, | let alone the richest billionare is going to be subject to | any serious consequences? It's absurd to even entertain | this. | | You know who has the authority to overturn that decision? | Our democratically elected legislature. | mrkstu wrote: | The Supreme Court restored the law of the land to the state | it was (i.e. enforcement of actual laws passed by | democratically elected legislators) by overturning a | previous ruling that did the opposite (i.e. make up reasons | not actually found in the Constitution to overturn laws it | didn't like.) | | This returned the law making and enforcing ability to the | elected arms of government and removed it from the | appointed arm. | | Whatever one thinks the balance between the rights of the | unborn and women's personal autonomy of their bodies should | be, let's be more accurate about the process of how we got | to where we are now. | wronglyprepaid wrote: | > The guy is pretty contemptuous of legal authority; he thinks | he is above the law and he might be right | | Of all the funny things I have read this week this takes the | cake, Biden will not allow him to get away with it, not a joke. | tyleo wrote: | Or they could put him in Chancery jail? The law is already | undermined if no attempt is even made at upholding it. | xxpor wrote: | But that's not how it works when you simply owe money | (usually, modulo things like probation violations and child | support, but lets ignore that for now). We don't have debtors | prisons). They can seize his money though, garnish his wages | (lol in this specific case though), etc. | gnopgnip wrote: | Contempt of court can lead to jail time in civil cases when | you have the ability to but refuse to pay | tyleo wrote: | I'm being loose with words but I do mean that he should see | punishment. Not necessarily jail. | metadat wrote: | He _should_ see jailtime for the market manipulation. We | 'll see what happens. This isn't even a thing the SEC is | known to be pursuing presently, so don't hold your | breath. | parineum wrote: | > He should see jailtime for the market manipulation. | | Is that the normal punishment? | metadat wrote: | Who else is rich _and_ dumb enough to do it in public via | Twitter? | mirntyfirty wrote: | It's an interesting irony I think that one of the worst | punishments for him is to have him follow through on the | agreement that he signed. | throwaway09223 wrote: | > What if the court orders Musk to close the deal and he says | no? | | I can't believe people are taking this very silly statement | seriously. This is utter nonsense. There are remedies for | people who disobey court orders. Having assets makes you _more | vulnerable_ to a court 's authority because you have something | to lose. | | If a court orders specific performance and he doesn't do it | then he's liable and the court will take his assets to | compensate. | | Is Levine seriously suggesting that US courts don't have the | authority to impose financial penalties, find liability, and | seize assets? This is such an absurd thing to say it's hard to | find a way to charitably respond. | dreamcompiler wrote: | Levine has addressed this in past columns. Of course the | courts have such authority, but individual _people_ have to | enforce the court 's decisions, and sometimes those people | are reluctant to take on Musk. | | Musk is a special case because he has done things like | threatening to ruin the careers of SEC lawyers who have come | after him, and he has the power to make that happen. | | Is this illegal? Probably. Does Musk get away with it? Yes. | throwaway09223 wrote: | You're talking about Musk pressuring Cooley to fire a | lawyer who previously worked against him at the SEC. But | the result was that Cooley told Musk no. Hardly a success | story for Musk. | | There's no shortage of law firms willing to go up against | billionaires. Hell, there's no shortage of firms willing to | go up against criminal enterprises like drug cartels. | | The idea that Musk is somehow more threatening than the | types that the US court system regularly puts under their | thumb is simply laughable. | sroussey wrote: | Cooley then lost business from Musk firms. | throwaway09223 wrote: | So what? This is business as usual for law firms. They | will lose clients every time they take a case due to | conflicts of interest and so on, even if everyone has a | happy outcome. | | What Musk did was petty and questionable, but it didn't | fundamentally change anything for Cooley. | | It's not a big deal. | paulcole wrote: | > Is Levine seriously suggesting that US courts don't have | the authority to impose financial penalties, find liability, | and seize assets | | No. He's suggesting that Musk's wealth and power will make | the people who work in US courts reluctant to impose | financial penalties, find liability, and seize assets. | reverend_gonzo wrote: | Levine is suggesting that they don't have the balls to | enforce those penalties. | | And by history, he may very well be right. | hotpotamus wrote: | Anytime the idea of a wealth tax is brought up, I see | commenters coming out of the woodwork to say that it would be | impossible to actually collect it from the wealthy. Though I | will note that it seems like we are able to collect yachts | and planes from Russian oligarchs now, so perhaps our | techniques have advanced in the last few months. | nikanj wrote: | It's easier to collect from foreign billionaires who don't | have the connections. Igor will probably not fund your re- | election campaign, but Musk might. | sascha_sl wrote: | There's an entire profession who's job it is to go full | scale threat modeling on assets held directly or indirectly | by the extremely rich. Seems likely they either didn't | account for war sanctions or thought the impacted assets | would not be worth putting behind 10 proxy legal owners for | the unlikely case of such sanctions. Yachts and planes seem | like they'd be particularly hard to turn into assets owned | by a local proxy entity, since they move around so much. | phillipcarter wrote: | Perhaps it's just a general sense of disillusionment, but | I've come to see that "court orders X" and "X happens" are | entirely orthogonal. I will be personally surprised if Musk | pays a single cent. | heartbreak wrote: | Levine's take is based on how Musk's previous encounters with | court orders have gone. | throwaway09223 wrote: | No, it isn't. It's completely disconnected from reality. | | There isn't even one single court imposed fine which he | hasn't paid. | dragontamer wrote: | How goes his court ordered Twitter sitter that's supposed | to prevent Musk from Tweeting about material effects | related to Tesla? | | That's what I thought. Musk just ignores the law and gets | away with things on a regular basis. | CamperBob2 wrote: | That was a stupid order that would never survive scrutiny | under prior-restraint doctrine. Specific performance is | something different, though... I can't think of any | constitutional problems that might block enforcement of | that. | slotrans wrote: | But he has agreed to SEC sanctions and then subsequently | ignored them... | daenz wrote: | >the court will take his assets to compensate. | | How do you seize billions of dollars of stock without | affecting share prices? | Spivak wrote: | You don't care and keep seizing and selling off assets | until you hit the target number or you run out of things to | seize. | | You're acting like the asset value at all matters to the | courts. | daenz wrote: | Couldn't other shareholders sue the government for | tanking the stock and essentially "stealing" value from | them? | parineum wrote: | > without affecting share prices | | Why should that be a concern? | hedora wrote: | They could simply keep selling Elon's Tesla stock it until | they had the money to cover the court order. | | Why should the court or Twitter care if they end up | converting 10x more of Elon's stock to cash? | | I guess some day traders would get rich (and people that | had to sell for the day or so when the stock tanked would | take a bath), but that's the biggest problem I can come up | with. | throwaway09223 wrote: | It doesn't matter if they're affected. A judgement is going | to be for a dollar amount. A court will rule that Musk must | pay twitter X billion dollars. Twitter can then pursue | Musk, taking basically anything he owns in terms of | business. | | They could contact the broker holding his shares and | restrain them, order them sold, and collect the proceeds. | | They could seize and sell at auction the real property of | any of his businesses. SpaceX rockets? Office chairs? | Servers? Anything. | | All of this enforcement costs money. Twitter would account | for the money spent seizing assets and charge those | expenses to Musk as well. | | Assets seized in this way (including stock) are often sold | for much less than they're ideally worth. It's Musk's | problem. Twitter would be empowered to seize seize seize | until they've raised enough cash to cover the judgement | plus expenses. | gpm wrote: | > They could seize and sell at auction the real property | of any of his businesses. SpaceX rockets? Office chairs? | Servers? Anything. | | They could not, because he does not own those businesses | outright. Doing so would violate the other owners rights. | They can seize his shares in SpaceX, but not SpaceX | property. | throwaway09223 wrote: | Sure. The particular way the assets are seized depends on | a number of different technical details. | | But the end result is always the same. You can either | voluntarily liquidate and pay your judgements or you can | have someone else do it for you. | amyjess wrote: | If they take all of Musk's shares in SpaceX and acquire a | voting majority, they can then use those shares to vote | to sell off the company's assets at the next board | meeting. | gpm wrote: | That would almost certainly be a breach of fiduciary duty | to the minority shareholders. | moomin wrote: | This is why going behind on a mortgage can absolutely | ruin a regular person. | chartpath wrote: | It's not like the shares are destroyed or immediately sold. | If anything, they are prevented from being sold under pain | of contempt, so could increase prices by limiting the | supply. | pg_1234 wrote: | You just continue seizing assets until the accumulated cash | value realized from the sale of the assets matches the | value of the financial judgement against the guilty party. | | The drop in share prices as you do this is not your | concern. | almost_usual wrote: | Don't invest in a company ran by a lunatic? | jollybean wrote: | Could ask him to pay the $1B fine in the deal for walking away? | russdill wrote: | The $1B is it he walks away and Twitter is ok with it. | Another clause allows Twitter to force the deal to close so | long as they are operating in good faith. | | The purchase price of 54.20 per share would net a lot more | than a billion given the current share price. | eftychis wrote: | No. The $1B clause does not involved the two contractual | parties pulling out of the deal. | nathanvanfleet wrote: | Why do you think it's mutual when Twitter is suing him for | backing out? | kgwgk wrote: | Why do you think he thinks it's mutual? | paulgb wrote: | The phrasing could be read that way "No. The $1B clause | does not involved _the two contractual parties_ pulling | out of the deal." (Emphasis mine) | | I think OP may have intended to say "one of the two | parties" | eftychis wrote: | The deal can be stopped by a third party which is not the | case at this point. See another grandchild comment that | expanded on that. | jollybean wrote: | ? It's my understanding that if Musk walks, he's supposed | to pay $1B and visa versa. | | So he's using the 'bot' issue to find an excuse for a deal | he wants out of. | | [1] https://www.cbc.ca/news/business/elon-musk- | twitter-1.6432315 | imustbeevil wrote: | It seems like a common misunderstanding because the | reporting around this is so bad. | | > Musk and Twitter agreed to a so-called reverse | termination fee of $1 billion when the two sides reached | a deal last month. Still, the breakup fee isn't an option | payment that allows Musk to bail without consequence. | | > A reverse breakup fee paid from a buyer to a target | applies when there is an outside reason a deal can't | close, such as regulatory intermediation or third-party | financing concerns. A buyer can also walk if there's | fraud, assuming the discovery of incorrect information | has a so-called "material adverse effect." A market dip, | like the current sell-off that has caused Twitter to lose | more than $9 billion in market cap, wouldn't count as a | valid reason for Musk to cut loose -- breakup fee or no | breakup fee -- according to a senior M&A lawyer familiar | with the matter. | | https://www.cnbc.com/2022/05/13/elon-musk-cant-just-walk- | awa... | jollybean wrote: | What did I misunderstand? | | Yes, I get that if there are 'material issues' maybe he | can walk (even though he apparently waved a lot of that). | | He can't just walk away for 'no reason' and not pay the | fine. | | The crashing price is probably not a legit reason. | kgwgk wrote: | The point is that paying the 'fine' doesn't give him the | right to walk away for 'no reason'. If he does he may end | paying damages for much more than $1bn. | avalys wrote: | No, it's worse than that. | | He can't just walk away and _pay_ the fine. | | He is obligated to close the deal and Twitter can force | him to do so. If some external force stops the deal from | happening - or if he can show that Twitter egregiously | violated the agreement - he can get away with not buying | Twitter, but he still has to pay them $1B. | jollybean wrote: | Hey Zeus. | | How could Musk possibly have done this, which must have | been against the advice of his Bankers? | | "I'm sending men to mars, ergo, I know more about M&A | than i-bankers? | | This is the kind of hubris that takes people down. | tveita wrote: | It would be perfectly fine terms if he _actually wanted | to buy Twitter_ - at a silly price but hey, it 's his | billions of dollars. | | That's presumably what he told people and not "hey I'm | just joking around, make sure to write the terms so the | deal never actually completes" | np- wrote: | Assuming that is the appropriate penalty (I know nothing about | Chancery law), why exactly can't they just issue a warrant for | his arrest and put him in jail? He doesn't have a private | militia or anything like that | hollasch wrote: | And who do you imagine would do the arresting bit on behalf | of the Delaware court? | gamblor956 wrote: | Other states will enforce a lawfully issued arrest warrant | from another state. It happens literally all the time. | nabla9 wrote: | This is a second time Musk has offered to buy a public company in | bad faith. | | His reputation as a sufficiently reliable counterparty is gone. | anonu wrote: | Musk doesn't care about that one iota. He has more money than | god. And he's done that by being fairly effective as the head | of two big companies. | theonemind wrote: | Reality doesn't care if Musk doesn't care. For certain | purchases, there's a probability that Musk will simply find | that his money is no good. Not for sale to Elon Musk at any | price. | moralestapia wrote: | >He has more money than god. | | Yeah ok ... <cue the Titanic sinking>. | mLuby wrote: | The guy has 15X more money than god (using the Vatican's | wealth as a proxy). | aaaaaaaaata wrote: | His money will keep on talking tomorrow, unfortunately. | nabla9 wrote: | His dollar is worth 70 cent after this. | | It's likely that this will be the most expensive manic | episode any individual has suffered. | hotpotamus wrote: | He's got enough dollars that even if his dollars were worth | a penny he'd have a lot more than almost anyone else. | prox wrote: | Yeah, I am worried he has a mental imbalance that makes him | unsuited for some decisions. If he is wise he should just | focus on a few things and do it right. I admire what he has | done for space travel for example, but hopefully he doesn't | have to many yes men around him that make him to do much | unstable things. | loufe wrote: | Let's not forget that this is a take, not an indisputable fact. | Whether ostensible or true, he has cited potentially valid | reasons for both cases (he DID have investors lined up to take | it private and there WAS a lack of openness to investigate | Twitter). I'm not saying he did or he didn't, I just find this | kind of assertion (indeed the whole tone of the article) to be | a bit flippant and more of a channeling for dislike of someone | then for honest unbiased speculation of what is going on. | TedShiller wrote: | It's good he exposed Twitter as biased | kukx wrote: | So now there is a widespread support for Musk buying Twitter? | Okay, he may end up owning Twitter whether he likes it or not. It | is so funny and ironic. Whatever the outcome I agree. | georgeburdell wrote: | Musk holds a key piece of America's future in space in SpaceX. I | wonder if it's only a matter of time before he starts dangling | that to get what he wants in cases like this. I still am | generally favorable toward Elon, but I think we're seeing him | transform into a villain | roca wrote: | The "cave diver paedophile" incident made it abundantly clear | to everyone willing to see that whatever else he may be, Musk | is a malicious clown. It was always only a matter of time | before that had greater consequences. | RF_Savage wrote: | Exactly this. The mask slipped for a moment. | ALittleLight wrote: | I see in Elon a trait I also have, which is to pick up random | things, get interested in them for a while, and start to do | things, and then realize you're not interested in it at all and | drop it. I'm thinking of tunnels, neuralink, AI, taking Tesla | private, child saving cave submarine, things like that. I can | easily imagine he thought one day that he wanted to get into | social media, went full steam ahead, and then realized he | wasn't all that interested. | | It's bad, clearly, when this has negative externalities. A | better Elon would stop himself from hurting people with these | adventures - but, I also think it's possible that without this | trait, whatever you call it, Elon wouldn't have made the | progress in the areas he has. On net I think he's still done a | tremendous amount. | pwillia7 wrote: | Sounds like ADHD hyperfixation | sroussey wrote: | I think it's called the shiny ball syndrome, common to many | startup founders. | Swenrekcah wrote: | The day he starts threatening US homeland security with SpaceX | might be the day he finally understands his place. | scoopertrooper wrote: | > I wonder if it's only a matter of time before he starts | dangling that to get what he wants in cases like this. | | https://en.wikipedia.org/wiki/Defense_Production_Act_of_1950 | aseipp wrote: | I suspect any hypothetical scenario where he dangled SpaceX in | front of a suit, presumably from some natsec POV, wouldn't end | in the Iron Man 2 Tony Stark speech about "It's my property" | and befuddled politicians. It would end with him being forced | to bend the knee behind closed doors (and consequently watching | over his shoulder for the rest of his life.) Or he would simply | have a bullet put in him, and his remains would be grounded | into a fine, meat-like paste. | ta8645 wrote: | I don't know about a villain, but he definitely isn't a | saviour. Was hoping he'd follow through in reforming Twitter. | But it turns out, even with all his resources, he's actually | pretty weak in comparison to the forces set against him. | sroussey wrote: | Elon is the force against himself. No conspiracy required. | almost_usual wrote: | I see a similar trajectory as OJ Simpson.. | theptip wrote: | There's been a lot of speculating around here on exactly what it | would take for Musk to get out of this deal; here's the TLDR of | the analysis from Levine: | | > Musk cannot get out of the deal just because one of Twitter's | representations is false. He still has to close the deal unless | the representation is false and it would have a "material adverse | effect" on Twitter. This is a famously under-defined term but it | generally needs to be a pretty catastrophic effect. If the bots | are 6% of mDAUs, whatever. If the bots are 75% of mDAUs and | Twitter has been knowingly misleading its advertisers, and Musk | can expose that scam and advertisers flee and Twitter faces legal | trouble for its fraud, then, sure, material adverse effect. | | As to whether there is any evidence of a false representation | (not even addressing material adverse effect due to that false | representation): | | > The only basis for the claim is that "preliminary analysis by | Mr. Musk's advisors of the information provided by Twitter to | date causes Mr. Musk to strongly believe that the proportion of | false and spam accounts included in the reported mDAU count is | wildly higher than 5%." Notice that Ringler does not say that the | analysis shows that the bots are "wildly higher than 5%" of | mDAUs: That would be a factual claim that, I suspect, Musk's | advisers know is false. They make only the subjective claim that | Musk "strongly believes" it. | | And then, perhaps the better grounds for Musk to prevail: | | > The second pretext is: Twitter is not giving Musk enough | information about the bot problem. This is a better pretext, for | technical legal reasons, which we have also discussed previously. | In the closing conditions to the merger, representations are | qualified by "material adverse effect"; just finding that a | representation is false would not give Musk the right to | terminate the deal unless it caused an MAE. But covenants are | qualified by "all material respects": In the merger agreement, | Twitter promised to do certain things between signing and | closing, and it has to do those things, whether or not there | would be a material adverse effect from not doing them. So if | Musk can prove that Twitter hasn't complied with its obligations, | he can get out of the deal. | Turing_Machine wrote: | > If the bots are 6% of mDAUs, whatever. | | It seems like the purchase price should be of the order of 6% | less in that case. | | 6% of $44 billion is not a trivial amount of money. | govg wrote: | These are figured that Twitter has been filing with the SEC | for ages. How does it make sense if the purchase was agreed | upon when all this was public information? | theptip wrote: | This isn't how "material adverse event" works, which is the | term that was written into the contract that Musk signed. | | Normally "is the mDAU figure correct" is the kind of thing | you answer before you sign the merger agreement and lock in | your purchase price. | | Also note that the baseline in SEC filings was 5% bots, so 6% | is only 1pp higher. The claim was never that it was zero. | russdill wrote: | Do public statements before he signed the deal that imply that | he was aware that Twitter has a bot problem and already | suspected that the number we much higher than reported by | Twitter have any effect? | Barrin92 wrote: | wasn't that literally the reason he claimed he wanted to buy | it for in the first place? I remember him going on about | verifying every human on twitter and improving our discourse | | the thing he's pretending to ditch the deal for was the thing | he allegedly wanted to fix | sroussey wrote: | And wrote it in the SEC filed docs. | tptacek wrote: | It's kind of a moot point; Levine is reading tea leaves about | what a judge will think hearing all of this, but the fact is | that Musk waived the right to condition the acquisition on | Twitter's bot statistics, pretty much in black and white. | theptip wrote: | Levine certainly thinks this is true. | victor106 wrote: | Elon's going to get away with this. Even though he shouldn't. | | The rich play by different rules and the law lets them. | | If the rest of us did the same we would have to pay ridiculous | fines and/or spent time behind bars. | frankohn wrote: | My idea is that Elon Musk is just leveraging it's wealth and | public visibility to gain a lot of money easily tricking the | markets. Especially those market where people are more easily | gullible. | | I think he did it with bitcoins when it declared Tesla will | accept Bitcoin payments on the same basis of ordinary payments. | Just later he abruptly dismissed the whole thing because the | operation was terminated. In the meantime I guess he just | acquired a lot of bitcoins before the public announcement and | just sold them when the price was much higher. | | I think that stock market and Bitcoin market are easily gullible | by wealthy people because a lot of people investing are | inexperienced and are easily influenced by press communication | without ground truth basis. | lizardactivist wrote: | Did anyone think he would actually be allowed to buy it? Twitter, | as a weapon for propaganda and a tool for information collection, | is too important and powerful to just let someone like Musk do | what he wants with it. | fwip wrote: | What? Elon is trying to back out of the deal, not Twitter. | resoluteteeth wrote: | Nobody is trying to stop Elon Musk from buying Twitter except | for Elon Musk himself. | | Twitter, the banks lending him money, and the other investors | Elon lined up are all trying to make the transaction go | forward. | | So the answer is clearly that yes, Elon musk is "allowed" to | buy Twitter if he actually wants to. He may even have to buy it | based on the agreement he signed even if he no longer wants to. | labrador wrote: | I believe he was sincere, but found out quickly that a lot of | people had strong feelings about his plans for the platform. It's | possible he was in danger of losing people he really needs for | his other businesses. I don't blame him for bailing out on a | lose/lose situation. | checkurprivlege wrote: | Correct | | a tide of hatred turned against him | | Musk correctly reacted by withdrawing and not wanting any of | this | | you can keep the social media and deal with your hatred | yourselves or your therapist | rabite wrote: | paulgb wrote: | > but all he needs to have defense standing might be a single | one of the millions of accounts Twitter has claimed is an | active monetizable user to be shown to be a bot | | There's some good discussion in the article (whose author has a | law degree) about why that's not the case. | [deleted] | [deleted] | [deleted] | hartator wrote: | > that it has knowingly been massively understating the number of | bot accounts in order to trick companies into buying Twitter ads | and shareholders into buying Twitter stock | | Wasn't Google Ads 80% fake clicks on some studies? It won't be | surprising Twitter Ads is actually worse. There is so zero | incentive to clean it up and so many shady reasons to do it. | anonu wrote: | Fake clicks and bot accounts are two distinct things in my | opinion. Bot accounts are bad, fake clicks are much much worse. | hedora wrote: | It depends on your perspective. As far as I'm concerned the | whole target advertising industry is a blight on society. The | more click fraud undermines it, the better. | | On then other hand, bot accounts help get bozos elected, | encourage mass shootings, etc. | | Come to think of it, I don't think it depends on your | perspective. Bot accounts are a much bigger issue than click | fraud. | bmitc wrote: | Tesla bots are some of the most active on Twitter, or at least | some of the most efficient in achieving their goal of | manipulating Tesla interest, sentiment, and ultimately stock | price. Musk knows this. I wouldn't be surprised if he knows who | controls these bots. | tptacek wrote: | That might actually hurt Musk's argument, because Google is | incredibly lucrative despite the belief that ad clicks are | overwhelmingly fake. The rule of thumb Levine (an attorney) | gave a few posts ago for MAE's in Delaware courts is | "sufficient to cause a 40% drop in profitability". Not stock | price, not mDAU numbers, but income statements. | adventured wrote: | Musk wasn't pretending to buy Twitter, the article is using a | sort of simpleton interpretation of Musk's behavior. That's the | interpretation someone would take if they dislike Musk and get | overly emotional about his behavior. | | Musk is x y z. Oh my god, did you see the tweet he sent out!?! I | just hate Musk, blah blah blah. He's such a terrible human. This | one time he called a person a really bad name. - That's the type | of person that reads Musk's Twitter acquisition attempt the way | the article is. | | I don't care much about Musk one way or another, but this is not | a complicated context and the author is plain wrong. | | What happened is the market for hyper overvalued stocks has | crashed. He was faced with the scenario of paying double for | Twitter vs what it was really worth. Remove the Musk prop and the | stock collapses. Next up, the stock is heading south of $30 / | share. It might be worth taking over for $20-$25 / share at most. | | Musk didn't want to pay $20 billion more for Twitter than he had | to, even for him that was a bridge too far. Particularly while | his own paper bubble fortune is just as at risk of implosion as | the rest. | | It was really, really, really dumb timing. That was Musk's actual | issue. | kcplate wrote: | This to me seems the most reasonable explanation and explains | most of the behaviors involved on both sides. I don't buy into | "it was just a joke that went too far" theory. | | Musk doesn't want a turd. | | Twitter, essentially made a deal with the devil (from their | perspective). Despite being initially opposed to this deal, | they now has to sue to try and make it happen, because I | suspect if it doesn't "south of $30" is going to be more like | "around $20" and there are a whole bunch of folks that might | get interested in a takeover at that level with far more | villain potential than Musk. | tailrecursion wrote: | I'd like to learn how to read billionaires' minds. Anyone know a | good book I can read so that I can have the skills of this | opinion writer? | TillE wrote: | There's reams of Musk's direct thoughts about this topic and | many many others, coincidentally available on twitter dot com. | It's not overly difficult to get a sense of who he is and how | he thinks about things. | anonu wrote: | Matt Levine is a lawyer. Nothing to do with understanding a | billionaires mind. A solid legal understanding, especially of | corporate finance, M&A, etc is what you're looking for here ... | tveita wrote: | https://en.wikipedia.org/wiki/DSM-5 | aaaaaaaaata wrote: | Internet comment threads. | | No, seriously. Just keep finding better ones. | jollybean wrote: | They are of the same mind as any other person with a bit of | arrogance and hubris they just have more money. | | Imagine some lowly millionaire putting a bid in for a piece of | land / cottage he wants, and the karma that can come from that. | Same thing, different scale. | hotpotamus wrote: | "I want more" | | You're welcome. | ThalesX wrote: | I met an almost billionaire once; I mentioned how a million | dollars would cover me for the rest of my life and she | followed with a 10 minute speech on how money is horrible and | she can't sleep at night for their concern. I was moved but I | confessed I'd still want that million dollars to fall out of | the sky. It didn't feel like she "wanted more". | tluyben2 wrote: | I used to 'hang' with a billionaire friend of the family | and, maybe that might be dutch, he was incredibly frugal | (drove a crappy old but not classic car, lived in a rather | small house etc) and yea was obsessed with making more. He | would ask me out for a coffee and ask to split the bill (or | just pay his part and walk wait for me to pay my part) even | though I usually just paid as I don't like going dutch. He | spent almost no money during his life. Guess that is all | good for making fortunes. | SoftTalker wrote: | Warren Buffett reputedly lives frugally and clips | coupons. | hotpotamus wrote: | How did you meet her? Were you at a zen meditation retreat | after retiring from remunerative employment? | | On a semi-related note, one of the most predictive factors | of stress in any primate societies is inequality, but one | of the more surprising factors is that stress increases for | everyone, even those at the top of the heap. | metadat wrote: | Un-paywalled: https://archive.ph/5nLiC | dang wrote: | Recent and related: | | _Notice of termination of Twitter merger agreement_ - | https://news.ycombinator.com/item?id=32027341 - July 2022 (1361 | comments) | georgia_peach wrote: | This is politics masquerading as legal analysis. Twitter, by its | own admission, lied about their user count for years. Elon will | either go without penalty, or take a slap on the wrist. Levine | spends a lot of time shilling on bots because he knows that's a | weak spot for the Elon haterz club. | | https://nairametrics.com/2022/04/28/twitter-says-it-inflated... | | edit: Not an Elon fan BTW. Just don't appreciate this Levine's | axe-grinding masquerading as impartial legal analysis. | georgia_peach wrote: | And to the _georgia_peach_ haterz, who can 't be bothered to | back their downvotes up with a comment: keep on believing in | that free legal education you're getting from Goldman M&A. | hartator wrote: | If "serious" business led us to wars like in Ukraine, I'll take | Elon Musk's expensive jokes any day. | ReaLNero wrote: | BTW, to those who don't know -- Money stuff is free if you | subscribe to it as an email newsletter. | | Link: https://www.bloomberg.com/account/newsletters/money-stuff | vitorsr wrote: | Plus, as prominently displayed in a Pinned Tweet on Levine's | Twitter: | | https://twitter.com/matt_levine | [deleted] | slotrans wrote: | and you _absolutely should subscribe_ because it is fantastic | and hilarious | dang wrote: | (We detached this subthread from | https://news.ycombinator.com/item?id=32036815.) | xiphias2 wrote: | I don't understand why we need to make things personal: a | multibillionaire with practically unlimited resources is | negotiating with a multibillion dollar corporation with | practically unlimited resources. | | It's clear that the offer Elon got stuck with has an unrealistic | price at this point (and Elon just want a reason to get out of | the deal), just like it's clear that Twitter's management is | incompetent in the last few years. | | I just hope that there will be a lawsuit with juicy details so | that I can get my popcorn, but I believe the 2 parties will | settle. | roca wrote: | Twitter management probably didn't have much choice but to | accept the deal. Turning down an offer significantly above the | stock price sounds like a trigger for a shareholder lawsuit. | bambax wrote: | > _It's clear that the offer Elon got stuck with has an | unrealistic price at this point_ | | But that's not how it works. That's why we have contracts, and | covenants, etc.: it's so that, if conditions change, one party | cannot say "oops, sorry, changed my mind" and walk. | | (Also, the offer "Elon got stuck with" is his own, and even | bears his childish signature of a weed joke.) | addicted wrote: | Elon only got stuck with it because he explicitly waived the | right to due diligence which would have protected him from all | this. | | He tried to act badass but came out looking like a dumbass. | | Everything since is his effort to get out of this (which he | will...one of the nice things about having a lot of money is | that it's very hard to lose, no matter how illegal whatever | you're doing is), but is also trying to pretend he didn't do | something really really dumb. | | I see absolutely no reason to help Elon rewrite history | especially when he could very well paid the penalty and walked | away like he contractually agreed to, which would have ended | the matter right there. | refurb wrote: | Pretty much. | | It's like selling a house and buyer makes an offer with no | contingencies. | | Sure, you can sue them to close the deal but the juice isn't | worth the squeeze. Does Twitter want to be locked into some | multi-year court battle? | | They'll settle and the news will move onto something else. | mupuff1234 wrote: | Suing to close the deal can be a way to get leverage for the | eventual settlement. | moralestapia wrote: | >Sure, you can sue them to close the deal but the juice isn't | worth the squeeze. | | LOL, I'm sure the juice will be worth the squeeze on a $44 | billion dollar house. | refurb wrote: | Nope. Years of court battles distracts the company and | keeps other buyers away. | jcranmer wrote: | > Does Twitter want to be locked into some multi-year court | battle? | | Delaware courts are pretty fast. The court case could | conceivably be finished before the end of this year. | whiplash451 wrote: | Also, if we're talking dozens of billions of dollars, yes, | it totally makes sense for a company to engage into a | multi-year battle. | refurb wrote: | Presumably Musk's legion of lawyers can find some way to | drag things out. | CogitoCogito wrote: | Why do you presume that? | refurb wrote: | Court decisions can be appealed. | CogitoCogito wrote: | And those appeals can be ruled upon and then the case can | reach a conclusion. It's not like the lawyers can just | take _any_ case with _any_ facts and keep the case from | _ever_ reaching a conclusion. | | The real question you should ask yourself is, if $44 | billion is on the line, how long would you continue to | pursue the case in the face of lawyers who are just | trying to drag it out? Even if it went on for years (it's | not assured Musk's lawyers could drag it out past a | year), I can think of 44 billion reasons to continue with | the case. | refurb wrote: | I think you underestimate the burden on a company of | multi-year litigation. | | They won't get any more buyers while it's happening and | it's a massive distraction. | | I've worked at companies like this and it brutal on | employee morale. People just leave. | HWR_14 wrote: | > I've worked at companies like this and it brutal on | employee morale. People just leave. | | Who cares? If you think you're going to win, it's just | Elon causing his future employees to quit. It's not going | to affect your payday of $54.20. Similarly, no other | buyers will make lower offers. Those are, by definition, | worse than just suing. | TillE wrote: | It's not like there's another buyer out there offering $44 | billion. Twitter has no reason to settle, unless maybe the | stock price goes way up. | refurb wrote: | It's like a divorce. You can either reach a settlement or | spend a ton of money fighting for years. | | You imagine how distracting it would be for Twitter to have | this in their quarterly updates? They certainly aren't | selling the company until it's resolved. | | My prediction - lots of public tough talk, then a quiet | resolution. | CogitoCogito wrote: | > It's like a divorce. You can either reach a settlement | or spend a ton of money fighting for years. | | There's basically no way they could possibly spend even a | tiny fraction of the overall deal's worth fighting this | even if it went on for years. Not spending that money to | fight this would really be stupid. | edgyquant wrote: | The answer is almost certainly yes. It isn't Twitter sitting | in a court room for nothing they're getting higher than the | stock price was when the deal was announced. | | It's a profitable venture for twitter | MrMan wrote: | Analogies don't work with corporate law | jollybean wrote: | Twitter management is not incompetent, Musk set his own price. | | He should definitely pay a fine. | | You can't walk into a situation and cause major chaos - | literally executive turnover, stock going crazy, all sorts of | turmoil - and then walk away on bad faith and excuses. | | Also - he does not have unlimited resources. He literally | cannot afford this deal right now. | kzrdude wrote: | He can afford it, but not without causing further chaos to | himself and his companies. | eftychis wrote: | He practically bought it; it's unlikely an agency or third | party to intervene / object; only thing to "save" him is | stating he doesn't have the monwy/funding was pulled due to | lack of information. Even then, I doubt he would avoid it. | | Of course they can drag each other to the bottom until one | gives up. I doubt Musk will and Twitter might have | existential issues if it doesn't get bought with rumors | related to their user base quality. | jollybean wrote: | The user base quality thing, irrespective of what the real | answer is, is mostly a canard. The only way it could | possibly get used is by Musk in the public commons to trash | them. | | Other than that, this will be a side-show court battle now, | unless one party has reason to continue arguing about it in | public sphere. | hey2022 wrote: | Twitter is a public company. We can not ignore the effect this | situation has on the investors (regardless of whether someone | thinks "they deserve it", or something equally irrelevant). | shalmanese wrote: | Contracts matter. The ability for two parties to create a | contract and to have reasonably secure knowledge that the state | will still in and enforce the terms of the contract, using | violence if necessary, is a massive foundational element to | free market capitalism. | | We see in states where such an expectation is not present, that | it becomes an enormous invisible drag on all business activity | and degrades the civic functioning of society. | | One of the crowning achievements of Western Liberalism was the | concept of "rule of law" and that there would exist an | impartial, powerful judiciary independent of political power | that could bring massive resources to bear to enforce | contracts. | whiplash451 wrote: | Can you please elaborate on what makes it clear that Twitter | management was incompetent in the last few years? ___________________________________________________________________ (page generated 2022-07-09 23:00 UTC)