The stock, and subsequently the stock market, is so detached from reality. For the life of me, I can’t understand why investors will literally put a 100x premium on Musk, and the things he touches. I feel like I’m living in some alternative universe.
SpaceX had this similar mystique to where owning a private share was something rich people bragged about like having a rare Lamborghini.
A lot of these modern bubble stocks are underpinned by a bunch of intangible collectibility reasons that realistically only exist because of a huge cash glut in the US stock market.
Maybe it goes on for a long time, but realistically as baby boomers start drawing down on their retirement portfolios and/or dying there's reason to believe money will start leaving the markets in the next 20ish years.
You seem to live in the real reality, and presumably people care about what you think there because it’s actually real. So why not enlighten us, help explain it to us deluded people? Or you can just be rude and vague.
The stock market is not definitionally "reality" in the sense being used. It's perfectly fine to look at the stock market and consider it "detached from reality", in the sense being said.
I live in a country (Norway) which has been a early-adopter market for EVs. In 2014 Tesla cars were endemic, you could see them everywhere. I was a big believer in Tesla cars.
But things obviously changed. We're still a lead market as far as Tesla sales go, but right now it is just another car. There's absolutely no rationale to automatically go for Tesla.
Which is why I find it incredibly difficult to see how Tesla is valued. The Tesla market cap is more than all other EV producers combined.
Musk evangelists will now yell "Self-driving cars! AI! Robotaxi!", and rationalize that the value behind Musk is potential. The potential that his products will be some fantastical thing in the future.
It's not like his checking account has $1T in it, this is just a technicality that sums up all of the hypothetical value of the shares he owns in companies.
If he actually tried to sell it and turn it into cash it would be less than $1T.
Buy-Borrow-Die resets the basis for capital gains tax, but then there's estate tax when the money gets passed on (exemption is only $15 million, trivial to billionaires).
No, taxed when you earn the money that repays the loan. Income tax, capital gains taxes, dividend taxes, estate taxes, etc... However the money was acquired to repay the loan, a tax was applied.
Can I e.g. borrow against my assets and not pay any taxes?
If you have a 401(k), yes. It's a way to turn a 25% credit card debt into a 5% loan.
The hitch is that while you can pay the credit card company over 30 years, the 401(k) loan is less than a decade, resulting in higher payments short-term, but money saved in the long term.
This strategy is not a traditional loan with interest and regular payments. If you try to live on regular loans it doesn't make any sense. It's a scheme mostly only available to HNW people where they repay upon death in certain tax loophole ways.
You won't pay taxes but you will pay interest. Most forms of value (real estate, gold, stocks, your car) you can borrow against in the USA, but the interest you pay almost always makes it a dumb idea.
If you borrow against it you still have to pay interest. If he somehow found someone to loan him $1T, which would probably be practically impossible, the interest would make the total amount he got less than $1T.
if you borrow against it and buy shares of stock, the stockmarket generally can be counted on for at least 7% returns, and the borrowing cost would be 5%, so no, chances are the interest would not eat up the borrowing.
So? Imagine he sells all his ownership and this tanks the value of his companies by 90%. Oh no. He only has $100,000,000,000 in the bank. Enough to be ludicrously rich a thousand times over.
I have never once understood this "oh it is only paper money" argument.
I'm just saying that when you say "trillionaire" it evokes the idea that he's hoarding $1T in a bank account. But it's almost entirely just locked up in shares of companies, and if he actually wanted to turn it into cash it wouldn't actually be 1T.
SpaceX will be listed on QQQ in the next fifteen days. There are only around 4.2% shares publicly available for trading, (about $75 billion out of a $1.75T market cap). This means passive funds that include QQQ will be forced to buy and compete over a very small sliver of the total shares (estimated at around $25 billion)
The exchange regulations have just been inexplicably loosened a month ago to allow this circus to happen. Beforehand, a company would have to show profitability and stability and wouldn't be allowed to be listed on an index for at least a year after its IPO.
So there is no wonder why the price is as it is. Perfect scam for wallstreet and the little guy get screwed so even better.
I've read somewhere that even some janitors / lunch ladies became millionaires from their shares. Looking then at the great performance of some other stocks, I really wonder where we're headed
Musk has killed hundreds of thousands of people with his reckless dismantling of USAID (https://www.currentaffairs.org/news/how-elon-musk-killed-hun...) and actively promotes white supremacy and race riots on Twitter. The Georges Ruggiu of social media.
Meanwhile, here in our little tech bubble, we pretend it's not happening -- that he's not spending half the day amplifying some of the literal worst people on Earth and blathering about how immigrants are coming to rape our culture. Just focus on the IPO. Don't look behind the curtain.
Where is a good chunk of this newfound money going to go? Into the pockets of AfD, Reform, and other far-right monsters around the world.
It's all just... abhorrent. Beyond words. Regretfully, I start to understand the state of society that can foment revolution. Never before have I felt such impotent fury at the state of things.
I can only hope his career ends as Ruggiu's once did: in shackles in front of an international tribunal.
Bullshit. It’s not the responsibility of US to help everyone on planet Earth. Why doesn’t Saudi Arabia or China go and help? Not the least, most of the aid money is diverted by terrorists just like the medicaid scams in US. And Afd Reform are not “monsters”. The monsters are far left activists and charities who are smuggling people in boats to the UK to claim asylum and lining their pockets.
Also plenty of people upvote these stories when they come up. Yes, most of them are not welcomed by the HN moderating rules/team, and yes a large portion of them get death-flagged.
But please do not disregard the people silently doing something about it. It only reinforces the lie that "people who care about democracy" are outliers and alone. No we are not!
Yes, but: it's hard to have optimism when 4/5 of articles about Musk's horrifying behavior are insta-killed, while Grok and SpaceX puff pieces are cheerfully discussed with nary a mention of their owner's murderous politics.
What does it take to make someone persona non grata in SV tech? Absolutely nothing, as long as they keep bringing in the big bucks. Nazi salutes, incitement of racial violence, thousands dead from starvation and cut-off medical care -- doesn't matter in the slightest. In a functioning society, Musk would not be able to go anywhere without being swarmed by protestors.
Yes, being optimistic, specially today, is hard. But it is important to remember that HN is not SV, and SV is not the USA, and that the USA is not the World. But people have absolutely prevailed over much harder conditions. Even SV in the past was exceptionally anti worker: I wrote about the history of SV here https://news.ycombinator.com/item?id=47099922.
Finally, sometimes we just need a break. It is OK to take a break. Do not burn yourself out. This is a marathon, not a sprint. Finally, to quote a historian, "You're always in history, and your choices matter" (src: https://www.youtube.com/watch?v=AFbzg_bp-Q0)
It'll end in suicide or OD. Every time he pulls off a coup like forcing huge indices to buy and hold massive amounts of $80 billion float he delays the inevitable but in the end his puffery will collapse at some point.
I feel second hand embarrassment for all the bankers and analysts who have felt the need to pump this
I think he's steadily working towards "too big too fail": make the entire US economy depend on his rat's nest of a megacorp, plus miltech/policetech (SpaceX, Grok).
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