>>Collaboration is key. Across the world, we’ve been driving conversations with more than 50 global experts with technical, policy, media, legal, civic and academic backgrounds to inform our policy development and improve the science of detecting manipulated media.
I have mixed feelings about this. On one hand, of course collaboration is important. On the other Fb has near unlimited resources yet feels like they can shift the burden to other entities who in no way benefit from the problems their hugely profitable business creates.
Been geeking out about ZIP code data at https://incomedata.org . I never realized how cool ZIP code data is, just how important the census is, or how much fun working with geo data is.
I realized I was always looking for the best pen and I was geeking out about writing instruments so I started a website about pens: https://unsharpen.com/. There is some light programming, but it's mostly data entry.
Honest question: Does it really matter if he loses the chairman role? Or even if he lost the CEO role? If he was busted down to VP of Engineering he would still be a major shareholder and everyone would did what he said right? He just wouldn't have any "official" corporate leader responsibilities (quarterly calls, etc). Or am I totally wrong?
He will still be the most powerful single person at Tesla, but this at least opens the door for him to not be the most powerful entity at Tesla. There is no way of knowing when or even if the Tesla board will start saying no to Musk, but this at least makes it possible for them in the future. That is a good thing in my opinion.
In fact, I think a Tesla shareholder should be pretty happy with this settlement. The $20m fine at a time when Tesla is already running low of cash is certainly tough news, but every other part of this settlement is probably good news for the company's long term health. It is also obviously a lot better than some of the punishments people were talking about earlier this week.
Interesting excerpt from that NYT article - "The terms of the settlement are slightly tougher than those that two people briefed on the talks said Mr. Musk had rejected on Thursday, which called for a two-year bar on serving as chairman and a $10 million fine."
I don't know the terms. I'm assuming that this is a new issuance at the current market price and thus would effectively provide $20 million of additional liquidity to counteract the cost of the settlement.
Assuming he is buying newly-issued shares from Tesla, then the money goes directly into their treasury. So, the company will have $20MM more in cash than it did the day before.
I'm no finance person, lawyer, or anything like that. But I suspect that he can't just give Tesla money and it has to be in exchange for something, such as stock.
If it's newly issued the price will be dilution of the other shareholders stock. I guess it's a smallest burden on Elon and the rest of the shareholders.
I meant "covering" in the context of the parent commenter's concern about cash flow. He's not donating the money to Tesla, but he's preventing the fine from making their cash flow worse.
For those wondering why, look at the comments elsewhere in this discussion about how the $20mm owed by Tesla will cause them to run out of cash sooner.
> I think a Tesla shareholder should be pretty happy with this settlement. The $20m fine at a time when Tesla is already running low of cash is certainly tough news, but every other part of this settlement is probably good news for the company's long term health.
Hi there. More than 1/4 of my net worth, and over 1/2 of my equity holdings are in TSLA. I agree with every word of this. The $20M hurts, but on net, I think this is better for Tesla than if Elon had won the lawsuit.
You do you, but having 1/4 of your net worth in any company is extremely risky and ill-advised. I hope it works out for you, but I also really hope you diversify your portfolio.
I mean it's the most generic advice you can give. Maybe he enjoys believing in a single company and taking risks. Maybe he's totally fine even if he lost it all. People spend more than 1/4 of their net worth's on hobbies, but suddenly if you have 1/4 of your net worth in a single company it's a disaster and you are crazy.
Maybe he invested 2% of his net worth in Tesla at the IPO, was determined to hold the shares for at least 10 years until they executed on their vision, and has been too stubborn to sell until now.
Re-balancing your portfolio after things have started to go very, very well is certainly sound advice, and so is selling all your equity in a promising startup the moment it has significant market value (it will most likely still be worthless).
Yeah, this is closer to how I got here (cost basis is way more than 2%, but nowhere near 25%). As you hint at though, there's a cognitive bias in holding my position by this reasoning -- my gains are a "sunk benefit" and I am where I am regardless of how I got here.
For me, it boils down to two things:
1. I'm pretty conservative with the rest of my money (index funds, rental property). If Tesla went bankrupt tomorrow, I'd be fine. Don't get me wrong -- it'd be a bad day. But the financial hit wouldn't threaten my long-term happiness.
2. I only buy individual stocks when I feel the market has wildly misjudged a company. Tesla fit this to a tee, particularly (but not exclusively) in the early days. I took a large early position and have been buying dips along the way (yes, still). By my judgment, a dollar invested in Tesla still has a much higher expected value over 10 years than a dollar invested in any other equity that I feel qualified to assess. I would love to diversify the highly aggressive part of my portfolio, but hard as I try, I cannot find a deal this good in any other public company. So I've decided how much I'm willing to lose on what I believe is a great bet, and have invested accordingly.
Came to echo this sentiment, though don't know how old you are, and if in fact you are being 100% truthful. Having that much in a single highly risky company under intense conditions is not a sound investment strategy. Rolling the dice, just know the risk.
I'm being 100% truthful, but I recognize that saying this doesn't establish any additional credibility. :)
I didn't mean to make this about me or my investment strategy. I was just trying to back up the sentiment that the poster above me expressed -- that people with skin in the game will see this settlement as a great thing for Tesla. I have a lot of skin in the game and that's exactly how I feel.
> More than 1/4 of my net worth, and over 1/2 of my equity holdings are in TSLA.
No offense, but why???? It is crazy to have this much of your meet worth in ANY single company. I can only hope that you are independently wealthy and if TSLA went bankrupt (of which there is a very large possibility) that you'd be ok.
If your earnings are likely to go up dramatically later, then it's fine to take large risks with the money you can invest now. Unless you have large gains, it's not enough money to make much difference anyway.
This assumes of course that you've got the basics covered, like being out of debt and having some kind of emergency backup (savings, insurance, well-off parents, etc).
What the others already said; also, I am reminded of Enron and the stories almost 20 years ago of people being wiped out due to the Enron collapse. My internal reaction at the time was "diversify a little."
Due to the volatility and the extreme short interest, those puts are quite expensive, and have been for years ;) You could certainly buy out-of-the-money options at 50% of the current market cap expiring in the next quarter, and been doing so regularly during the last five years during which Tesla's prospects have seemed quite dodgy.
But it would have more or less have wiped out your upside. So if that's the insurance you would have liked for such a risky investment, it would have been better to just invest in something else.
I was thinking that one might partially cover (e.g. buy puts for 25-50% of the value of their portfolio) but you're right. the risk premium should be exactly equal to the expected profit on the asset, if the world works the way theory predicts.
Just FYI, but when you hedge with puts your holding period to realize long term gains instead of short term gains gets reset immediately, then you have to wait another year after you close the put position before you can sell as long term gains. Just something to keep in mind.
I'm a Tesla shareholder and I'm extremely hopeful, an independent chairperson could really cut down on the nonsense that makes the company off-putting to some investors. Just as Google needed an adult in the form of Eric Schmidt, Tesla needs someone who can collaborate with Musk. Eric Schmidt would be perfect but he's probably conflicted out because of Alphabet's Waymo. Though I'm hopeful that they'll find someone who can help Musk achieve goals and instill some discipline and sternness where needed.
However, it could go awry. If the independent board member were to try to combat Musk and get the company wrapped up in internal struggles, it could go badly for the company.
I suspect it would matter, for at least two reasons.
For that to work, you'd need a particular sort of senior management arrangement, not just to leave him alone, but to take a lot of heat for his eccentricities. You need particular people capable of forming unusual understandings for that to work. And there would also necessarily end up being limits - there's only so far folks will cover someone else's bets.
The second reason is Musk's ego. I think he'd find a demotion humiliating, and if he's not treated as a Master of the Universe Superhero-CEO, I bet even money he'd behave worse, pick fights with his minders, etc.
Research what he did when he was fired as CEO of PayPal. He made sure the company had good management by making sure Peter Thiel came back (even though they weren't the best of friends at the time), and he stayed quiet, allowing the team to execute and make him rich. Now that you know this, will you update your beliefs about his ego?
Everything I could find says the board asked Thiel to come back, not Musk... In fact, supposedly they fired Musk and hired Thiel back while Musk was flying internationally, and had announced they change at CEO before he landed.
Knowing that, it would explain his tendency to make sudden pronouncements and try to stay at the office/factory at all hours.
Went back to the sources, and it seems you're right on the Thiel thing. He did make peace with Thiel and Levchin pretty fast though, and even invested more money into paypal after he was kicked out (citation: the Ashley Vance book on Elon) which was my main point -- he didn't blow shit up or incite a rebelion, he just stayed on the sidelines and supported the team like a trooper.
You made two separate points, and the one you lead with was that he recruited Thiel after being fired... which isn't true. Also, "not blowing shit up" especially when he has money involved != 'staying on the sidelines and supporting the team like a trooper'.
Tesla wouldn't exist if Musk took "advice from people he doesn't agree with". It's easy to point to model 3 production but what about all the other instances he has proved the nay sayers wrong? Entrepreneurs are generally not people who take advice from people saying it can't be done, instead they prove it to themselves.
> You can draw a very short dotted line to all the automation they eventually had to rip out of the Model 3 production line.
Given his large-scale visions, I suspect the attempt at extreme automation was intended as a proof of concept about fully automated manufacturing for off-planet use.
Elon Musk should not have said what he did, but advocating for sodomy is not critique. Some cultures have the death penalty for sodomy whereas the acceptance of critique is celebrated as wise in most cultures. The character flaw of the news is that in cases like this, it does not seek to create a peaceful resolution between the two parties, but instead blows up their differences as much as possible. Both of these men tried to save the lives of kids.
I agree that Twitter censure is likely to be of benefit to Tesla. Starving the news of Elon Musk content is a good thing. It will hurt the profits of attention-derived news. Plus, the doom of the ICE industry is rearing its head. So they can talk breathlessly about that and criticize the existing auto manufacturers for not seeing the writing on the wall once they figure out a new strategy to maximize their attention derived profits. I'm cynical enough that I figure this story shift will probably happen around the time that Tesla starts taking out television ads.
Wu... wut? "Advocating for sodomy is not a critique" ???
What Elon did:
> Elon Musk has escalated his baseless attacks against a British diver, claiming without evidence that the man who helped rescue children from a cave in Thailand was a “child rapist” in an email to a reporter. [https://www.theguardian.com/technology/2018/sep/04/elon-musk...]
Yeah, the news doesn't really bother giving the full story with much subtlety. You can go look up what the guy actually said. There is a video of it. Basically, he figured that Elon Musk was trying to help just to look good with no substance behind the action. So he told Elon Musk he should shove the submarine that they (SpaceX team) built up Elon's ass. Pretty poor showing all around.
Makes for a great story though. Much outrage. The madder you are, the more irrational you have become? The better. Many clicks. Much profit. Much circus. Totally get why the reporter violated the principle of off the record conversations in order to earn themselves money and create drama. People make money, because you just linked this article. That is how this works. This is how social media generated news tends to make its money. If the story didn't outrage you enough for you to share that link with me? They failed.
But don't let them delude you into thinking its in the best interest of either party being reported on to be known for their worst moments. Nor for the public opinion of both people to be shaped by these moments. Both of these people tried to save the lives of children. The character of both people are very likely to be somewhat congruent with that. I presume innocence until shown otherwise with regard to the accusations leveled. It isn't a story of interest to me without evidence which backs it. I refuse to join either mob.
Saying "shove it up your ass" is a common idiom that is, while rude, not "advocating for sodomy".
(Which, by the way, is something that is generally A-okay - "sodomy" refers to gay (usually anal) sex, and Western societies have generally decided that's not a crime anymore.)
Wow, okay. This is still an incredibly bizarre point:
>Some cultures have the death penalty for sodomy whereas the acceptance of critique is celebrated as wise in most cultures
Anyway, he actually said Elon Musk to "stick the submarine where it hurts" and called it a PR stunt. Elon then responds with this tweet, which I think is relatively appropriate:
And a series of other tweets doubling down on the sentiment. This is insane and depraved. You can argue that this is all inflamed by the media, outrage culture , etc, but at the end of the day, the CEO of a hugely popular tech company took to twitter (where he has 23m followers) to spread vile and baseless accusations about someone.
He made these tweets originally and publicly in JULY. It was only recently (and after apologizing) that he REPEATED the accusations to Buzzfeed news. And the buzzfeed reporter also preempts your accusations that the emails were leaked improperly ("He prefaced the email with "off the record" though I did not agree to that condition. Off the record is a two-party agreement.")
> Both of these people tried to save the lives of children
Yah, sure. But one of them also took to their social media and their millions of followers to accuse the other of being a pedophile, and then repeated the accusation, and then apologized, and then REPEATED the accusation again months later. With no proof. And so Musk can both be someone who tried to save the lives of children and a piece of garbage who is prone to emotional outbursts that can do real damage to real people.
Yeah, bad way to make my point. I know that there is very clear adversarial search for and an adversarial amplification and adversarial provocation of all Elon Musk's flaws. This amplification involves a game of telephone in which their is mounting outrage which turns 'shove it where it hurts' into 'dared to critique the proposed engineering solution'. I'm trying to introduce reality again in the hope of stopping the mob mentality death threats toward Unsworth and the harming of the mission of electrification of transport. People are intentionally trying to help feed this system, to see what happens [1]. I've seen enough of what happens to know this is a bad idea.
Pretty sure the right thing to do is let the conversation die. Due process will bring much more justice than social media amplification.
I still don't see how that really applies. I agree that Musk is subject to a lot of scrutiny, and a lot of negative coverage in general. But in this case, he is absolutely in the wrong, and what he did and continues to do is despicable. This wasn't a case of the media taking his statements out of context or misrepresenting his views, and it's disingenuous to try and roll this event into the category of 'unfair media sensationalism'.
I think you are trying too hard to defend Musk. There is (to me) an immeasurable difference between "shove it up your ass" (which is telling Musk to do something), and "you are a paedophile" (which is saying the diver is a something, for which in almost every country in the world you would go to prison for). He then repeated the accusation, repeatedly, saying he is sure it is true.
The guy is now suing Musk, which really is (in my opinion) his only choice, as otherwise many people might assume the accusation is true (as Musk is so sure, and even asked why he wasn't being sued as a response)
> There is (to me) an immeasurable difference between "shove it up your ass" (which is telling Musk to do something), and "you are a paedophile" (which is saying the diver is a something, for which in almost every country in the world you would go to prison for). He then repeated the accusation, repeatedly, saying he is sure it is true.
> The guy is now suing Musk, which really is (in my opinion) his only choice, as otherwise many people might assume the accusation is true (as Musk is so sure, and even asked why he wasn't being sued as a response)
A corollary of this is for-pay news cares more for its readers than free news. You ought to pay for your information, if you want to incentivize getting good information.
Perhaps it's more accurate to say he's driven, no nonsense and shrewd?
Yeah. Of course he wears his ego proudly. You don't rise to that level without above average chutzpah. But I think that's more a side show than the featured event.
Yes, that's the gist I got out of his behaviour at X.com when they merged with Cofinity as well (from the book The PayPal Wars). He wanted to turn it into a full Microsoft shop, and and he wanted to change the name to X. To sum it up: people disagreed, and there were setbacks after setbacks with the former. When he put through the latter, there was a small internal struggle and Peter Thiel become interim CEO.
Not the OP but having followed Musk for a long time, I think his ego is enormous and that PayPal anecdote doesn't change that. Few people are more sensitive to criticism than Musk.
The chairman has the power to appoint members of the board, the board has the power to fire the CEO. So someone who's both chairman and CEO is virtually impossible to fire.
The combination of removing Musk as Chairman and adding two independent directors means there's a slim chance that he could eventually be fired – more likely, it means that Musk will be held more accountable to the board.
There's nothing only about owning 20% of a public company.
20% and the largest shareholder, is more than enough to turn any public company inside out. Hedge funds do it all the time with dramatically weaker positions of single digit ownership. Carl Icahn routinely does it with a few percent. It's an immense position in the public markets in terms of wielding power.
The Chairman role is largely symbolic. I seriously doubt that if he gave it up, it would reduce his work load.
EDIT: largely. In a company like Tesla, with such a strong CEO, the Chairman would be a symbolic role. In a very large and sprawling company (PepsiCo?), it wouldn't be so symbolic.
> In a company like Tesla, with such a strong CEO, the Chairman would be a symbolic role.
In a company like Tesla, that has been sanctioned by the SEC for failing to adequately control the public actions of the still-current CEO, it's unlikely that the Chairman would be a symbolic role.
So he made one big mistake. He's done a lot of good stuff. He was punished, he's done a lot of good for the world. Compare him to the heads of banks and financial orgs in 2008, people doing credit default swaps,, the entire financial world that takes a cut out of most transactions for no good readon, like ipos. He's a huge net positive for the world.
I don’t think the point of the comment is at all related to what Musk has or has not done, nor his value as CEO. The point was that after a public censure of a CEO and company, the subsequent Chairman would be expected to work towards preventing a similar situation and would have the authority/mandate to do so.
You'd get into even more trouble with the SEC if you ran a public company where the executives and officers are not what you claim they are but are stand-ins for someone else.
There are specific things that are the role of the top level executives, like certifying the company's SEC reports. But I'm not sure how having someone other than Musk independently and competently do those things would be expected to hurt anything.
Meanwhile, wouldn't it be completely normal and legitimate for a company to give the VP of Engineering or Operations a free hand in making engineering or operations decisions?
This. Tesla is a publicly traded company. It makes clear, legally-binding representations of who its officers are and what its organizational structure is. If Tesla represents that Musk is not longer a chairman, while in fact he is, then that's (again) investor fraud.
You are right. In most public companies, it would matter greatly since the chairman is the most powerful person in the company ( CEO reports to the chairman ). But as you noted, musk is the largest shareholder, but more importantly other large shareholders ( especially the institutional shareholders ) back him. So he would be in charge regardless. But removing him from the chairman is optically damaging, so it's not insignificant. It matters, but not as much as it would normally.
It would matter if there were someone else in the company in a position of higher authority who could say "no" to something Elon wanted to do, even if it only happened rarely.
I have mixed feelings about this. On one hand, of course collaboration is important. On the other Fb has near unlimited resources yet feels like they can shift the burden to other entities who in no way benefit from the problems their hugely profitable business creates.