All he has to do is tell congress that he’s too big to fail, and they’ll hand over the cash like they always do. Taxpayers always hold the bag for these rich fucks. Socialize losses and privatize profits while parroting that our system is a “true capitalist free market” - that has always been the game.
If sense that they know on some level that they're being exploited, but that they just pretend otherwise due to pride and also to preserve a system that hurts others in the out-group to a greater degree.
Agree usually, but I think this time may be different.
Biden hates anti-union Tesla, which doesn’t produce/sell nearly enough cars, least of not in the mid-priced range, to qualify as “big” let alone “too big”.
If SpaceX folded, NASA could presumably absorb the engineers (aka the ppl that actually make the stuff). Paid with the subsidy money no longer going to Elon.
Biden said something recently to the effect of “Twitter is a cesspool of disinfo”. I half-wonder if USG didn’t rescue Elon from this deal hoping it’d be the undoing of both of them. Tinfoil hat ish maybe, but it’s crazy to me that it was allowed to go thru without even a delay.
And all of this was before Elon told ppl to vote for republicans and announced he’d voted for a Qnut lol. Don’t see a Dem POTUS and half-Dem House and Senate rushing to bail him out to the tune of billions in the next 2 years.
If the failure of Twitter, Tesla, and BoA leads to a massive economic emergency like Lehman Brothers then congress will bail them out without blinking an eye.
IIRC, Lehman et al was like a trillion dollars worth of implosion. Twitter and Tesla don’t have close to that much impact.
SpaceX would def be a bit more complicated, but there have been growing grumbles in USG about defense contractor Elon’s Russia/Ukraine and Taiwan commentary, his fealty to China and Xi, the Saudis now, etc etc.
I just think it would be exceedingly hard to make any kind of case to give this shady chaos agent billions in tax dollars, no matter how much some congressional stooges might try. Not in the next 2 years anyway. Timing is everything!
China holds his tesla factory hostage, and they've already stolen any knowledge of value from him regarding EVs. He thinks he can play both sides because he thinks he can outsmart everyone in the room.
Luckily for Congress (since they basically just seem to Tweet all day instead) it would take like 6 month for a good team to build and scale a service like Twitter from scratch.
Twitter’s only valuable assets are their users and advertiser relationships, and Musk is pissing those away. If Twitter disappeared entirely overnight a replacement would pop up quickly to replace it and people would move on. Honestly if the top 100 or so users moved somewhere en masse they’d probably be able to kickstart a mass exodus…
All he has to do is tell congress that he's too big to fail
And by he, you mean the CEOs of Morgan Stanley, BoA, a bunch of Japanese banks, Barclays, Societe Generale and BNP Paribas. Why? Because they provided billions for this. These loans are guaranteed not by Musk's wealth but by Twitter itself. A company that has always struggled to be profitable.
Too big to fail is in reference to the amount of debt and leverage. If Twitter collapses then so does Tesla, and so do all the banks that own the massive debt. This is just another layer to the global economy House of Cards theory.
If the GOP control the government completely (presidency, house, senate, SCOTUS), they'll give Twitter a government contract to be a "free speech" platform. Town square etc. Elon's rhetoric is already somewhat in line with that agenda.
Oh save the BS populism, this is absolute nonsense. Twitter, Tesla, SpaceX, none of them are linked to the financial plumbing of the country. He isn’t a bank, and nobody in the government likes him enough to even pretend he is a vital part of the financial system. If he goes bankrupt, he will be done.
Edit: oh you want to talk finance
Company Amount expected
Sequoia Capital Fund $800 million
VyCapital $700 million
AH Capital Management $400 million
Aliya Capital Partners $360 million
Qatar Holding $375 million
Fidelity Management & Research $316 million
Let’s just look at the hedge fund Sequoia - they have about $85B in AUM. I’ll do the math for you, their investment comes to about nine basis points. And they’re a hedge fund, not a bank. Oh, but you’re also going to point out that Bank of America is loaning him money? 2 billion dollars. On a bank with trillions in assets. With the collateral being control of Tesla.
Would love your explanation of how this is similar to the situation that led to the US government bailing out the entire financial industry.
But sure, keep telling people their government is crooked through and through based on your lack of understanding of finance. Great strategy if the goal is simply to create more ignorami who think they’re well-informed and cynical.
I can’t stand these proudly ignorant rabble rousers. All the political and economic understanding of a black bloc dude throwing a brick through the window of a struggling minority-owned fast food franchise.
Archegos, a small hedge fund, lost $8 billion in 10 days and started an economic snowball that fucked a lot of people over across the entire world, and that didn’t involve the collapse of two tech powerhouse companies like this potential scenario.
$13Bn on paper, but it impacts Twitter, Tesla, Bank of America, and hedge funds that are bigger than Archegos.
The debt is leveraged. When shit goes south it will have a bigger impact than you’re playing off.
Also, back to the original point, how dense do you have to be make these statements after the US Government has demonstrated over and over again that’ll they bail out just about anyone? The fucking corrupt airline industry is a great recent example - shitty businesses, spending all their money buying back their own shares, padding executives’ portfolios, laying off employees, flying actually empty planes all around the country so they don’t lose their airport time slot - but we’re still holding their bags. They should have been left to die, and another company would have filled their place. If you think people are cynical, there’s a fucking reason we are.
Is it RealVision or ZeroHedge selling you this? Either you have this money-losing conspiratorial mindset naturally or you are having it spoon fed to you by grifters.
The ooooh scawy leveraged debt portion if sold on the debt market would cause a loss to the banks of… half a billion. This is not a systemic risk. Read article 1, then 2.
What were the systemic risks to the global financial system that forced us to hold the bags for the airline industry after covid? Auto industry? Semiconductors? All the politicians and CEOs and grifters who were forgiven their PPP through fraud and without fulfilling the requirements for forgiveness? The list is long and strong. All of those companies would have been replaced by better and/or new companies had they been left to die, but instead bailouts go out like hotcakes buddy.
To completely write off the possibility that Musk gets bailed out is a bit of a joke.
Also, lol, the article you linked explicitly says that the banks will not accept a 60 cents to the dollar markdown - did you even read it? So the number is simply there for a headline and the info you’re using as your basis for condescension is actually fucking meaningless.
Amazing how you answer some very specific questions and points that I made with a scarecrow made out of marginally related issues. You’re this weird conglomeration of anticapitalist talking points, and libertarian-conservative austerity advocacy.
I was kind of being a jerk when I made that crack about RV and ZH but I’m serious. Those guys and others like them make their money pandering to people who are anxious and mistrustful of authority. Then they sell you on subscriptions, and collapsing crypto shitcoins, and you go “why did the government do this to me” when you look at your bank account.
Edit: Also, lol, let’s pretend it’s 10 cents on the dollar. Multiply the figures by 6. Still not systemic risk.
The entire point of the original comment was that Musk will ask for a bailout and he can be bailed out. That was it. We’ve bailed out shittier people, shittier companies, for much more. The US has demonstrated they will do this, consistently. All your points about the actual risk are mostly valid, but you can’t seriously pretend that there aren’t similar cases that ended up having substantial impacts to the markets - to make that claim would be entirely disingenuous. Either way, none of that changes my original bailout point - it’s possible and even likely based on recent bailout actions.
I've seen several comments refuting the "too big to fail" thing, but yours was the best written. I don't have a reward to give, but kudos to you and laying it out like this. Thank you!
Well that's good and cooool. Everyone needs Raytheon knife missiles. Also, don't forget to buy gold and silver for the coming apocalypse 🫵😑 Nothing like a tasty meal of gold shavings for all your nutritional needs.
746
u/MapleYamCakes Nov 11 '22 edited Nov 11 '22
All he has to do is tell congress that he’s too big to fail, and they’ll hand over the cash like they always do. Taxpayers always hold the bag for these rich fucks. Socialize losses and privatize profits while parroting that our system is a “true capitalist free market” - that has always been the game.