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They basically print money by issuing stock, then compensating with that stock.
To add to that, billionaires avoid taxes by borrowing against their astronomical securities and stock assets. This is one of the reasons interest rates are of such concern to the rich.
They can then use dividends and other liquid income to perpetually pay for the interest. If shit hits the fan, or they want to pay off the loan, then they would have to pay taxes on the income from the sale of assets.
But if you have a trillion fucking dollars in stock, paying tax on several billion dollars isn’t comparably bad, especially when you can purchase influence by manipulating society with your own social media company and inducing corruption by getting Trump elected.
It may be their plan, but I think that stock is already on shaky ground. Tesla car sales are declining and they are probably running on deficits now, and energy projects are not going anywhere fast.
The moronic Optimus robot Tesla plans to make is already surpassed by Xpeng, with way more convincing presentation of their humanoid robot Iron, and where Xpeng uses in-house chips something Tesla doesn't have. And robotaxi is an obvious flop that is also going nowhere. Everything Tesla is falling more and more behind.
How that stock hasn't already collapsed IDK.
Oh sure, the stock price is shaky because Musk is a Nazi and people recognize it, as well as their products not at all living up to the hype, and Musk doing things like only using cameras for any self driving.
The Musk compensation package itself won’t effect the stock price, though, unless you count it as “throw it on the pile of injustice”.
Maybe not as long as it's just a piece of paper, but as soon as this compensation begin to actually have to get paid, you can bet it will have an impact.
I sincerely hope the Norwegian fun pulls out, and even if they try to do it slow to not impact the stock value to much to get as much out as possible, there is no way you can put 5% of the stock back to the market without it having an impact.
It’s not in the market, though. It’s in Musk’s account, and that’s where it’ll stay (for the most part). Especially options.
Doesn't matter, when the stock is registered it's diluted, and will impact the numbers in earnings per share, and the total stock value of the company.
You can't just issue stock, to increase the value of the company, the stock price will always go down when you issue a significant amount of stock.
That’s fair, I totally forgot about EPS.
seems like thats why hes doing it, because norway has the 1trillion fund lying around.
American protectionism by banning Chinese EVs is how their stock stays up.
There's a fair amount of EVs on the market in the US that aren't Tesla's or Chinese. It's a market segment growing every year.
that doesnt include overprice ones from the eu, like bmw/mercedes
Kia, Nissan, and Hyundai all make EVs you can buy in the US. So do Rivian, Ford, and Chevy. There's probably more that I'm forgetting.
Oooo, that's gonna tank the value of the stock.
No, because Musk isn’t going to sell the stock (or exercise the options). He’s going to take out loans using the stock as collateral, and then pay those loans off with future loans.
Only plebs actually spend their own money.
It will still be a big dilution of the stock. Which will put very hard pressure on the stock price.
There is no way to dilute that much without it having a significant impact.
It only dilutes the price if the stock gets sold.
What does get diluted is the dollar.
No,
Ummm dude that's not how that works.
No money gets created.
All existing share holders get diluted. The shareholders are paying Musk if this happens. When he gets a paid a tranche, the stock price will dip because of the dilution.
Edit: like if Musk magically met all the tranches on the last day, and Tesla was worth 8.5 trillion. It's not going to suddenly be worth 9.5 trillion the next day. The price will go down.