Let's see $20M/140 characters = $142857.14/character
Sounds like Musk can use some tweeting advice from Trump.
If I have this straight, Musk defrauds his investors and the government gets the $20M?
I suppose it represents justice on some level given Obama's fraudulent trillion-dollar, no-shovel-ready-jobs stimulus that stole from We The People and gave to rich Obama cronies like Musk and their crazy pet projects.
2
Let's see… $20M/140 characters = $142857.14/character
Sounds like Musk can use some tweeting advice from Trump.
If I have this straight, Musk defrauds his investors and the government gets the $20M?
I suppose it represents justice on some level given Obama's fraudulent trillion-dollar, no-shovel-ready-jobs stimulus that stole from We The People and gave to rich Obama cronies like Musk and their crazy pet projects.
1
Glad to hear that the SEC and Musk reached a settlement. Most of us - except, of course, for our President - want Tesla and the electric car to succeed, for obvious reasons. Musk is not prefect, not by a long shot, however, there are few people on this planet who have what it takes to take a start-up in a new technology to the stage where Tesla currently is. The problem is not Musk, it is Wall Street and the corrupt financial system that expects ever favorably quarterly results, or it unleashes an army of short-sellers and gamblers which - hoping for the demise of Tesla - will rake in huge profits. What may be beyond the scope of people working the financial sector is that innovators like Musk don't do what they do because they want to get rich. They want to change the world. In that pursuit I can only say, good luck, Elon, but refrain from using Twitter in the future, please!
8
And where is that $20 million going to go?
2
"Mr. Musk was said to have backed away from a settlement, in part, because he was concerned that he could not later tell investors that he had not done nothing wrong. But the settlement on Saturday requires him to do that."
Ummm, parse that first sentence for me. There are three negatives in there. It's like doing a math equation trying to figure out what it means. Did you mean "he could not tell investors that he had not done *anything* wrong"? Or "he could not tell investors that he had done nothing wrong"? Because the way it's written it says that he wants to tell investors that he did something wrong and the agreement bars him from admitting culpability. And that makes no sense.
6
Musk's stunt cost investors way, way more than $20 million. The fine should be higher, he should be facing criminal charges and he should never again be allowed to sit on the board of a publicly traded company.
In the wake of shenanigans that caused the financial meltdown a decade ago, a lot of folks asked what it takes for the government to hold people accountable and for folks to go to jail when they do things that cost investors millions of dollars. We're still wondering.
Ridiculous. He got off way too easy.
3
Elon's Aug. 7 tweet was no doubt market-moving and made the mistake of misrepresenting the facts with "funding secured." For that, the SEC should rightfully sanction him/Tesla.
But SEC's attempt to bar Elon from ever serving on the board of or running publicly-traded companies went completely overboard. The means does not justify the ends in this case: although Elon was successfully forced into a settlement, the lawsuit caused the share price to tank 14%, wiping out $7.3 billion of value, on account of removing a key person/factor that contributes substantially to Tesla's valuation.
In cases of fraud, e.g. Enron, the drop in prices reflect investors' adjustment to actual fundamentals, previously obscured to them. With Tesla, the drop in value is due directly to the SEC undermining those fundamentals. The Elon lawsuit is none other than an abdication of SEC's mission of protecting investors. By looking to claim a win, its officers instead lost sight of their raison d'être.
I urge the fine team at NYTimes to dig deeper into the thinking, decisions, and stakeholders at the SEC that has led us to the actions seen over this past month. I think this story is less about an impetuous billionaire and his wild tweet, but of a storied institution cleaving to pressures yet unseen.
9
@Kingston W.
Meant to say "the ends does not justify the means".
The media coverage Elon Musk has been getting, both print and TV, seems way out of proportion to its importance and interest of the generally audience. Ever since the announcement about having "secured" financing, the media seems to have reported on him every hour or so. Seems like an insider issue, probably affecting primarily a few major investors, that has been allowed to totally dominate market coverage for a week and more. Just look how many stories The Times has run. How about replacing some of this blow-by-blow with stories about other companies that investors need to know about?
3
Ayn Rand wrote about this decades ago, after all who is, this decades, John Galt ?
@ElonMusk and similar visionaries have to figure out an alternative funding path otherwise innovation will die out as the innovators, game changers walk out of the squirrel wheel stock markets have become.
Even though Elon could get out of going to jail for what he said, he is leaving behind small investors who believed in him, his company i.e. Tesla, his goals and technology. Many of these loyal stock holders had a stop loss set up in their accounts, when this happened so fast late Thursday afternoon the stock dropped 12%, many of these long investors automatically sold.
The fiasco continued the next day on Friday when the stock lost another 2% and wound up loosing almost 14% profits in tsla.
What gets me upset is if the SEC waited until Friday AFTER the closing bell, the deal could have been made over this week-end, and these investors could have been spared, but no, someone in the SEC had to pull the trigger and shoot not short sellers, but long term solid loyal investors.
Tomorrow morning the stock will shoot up and be out of range for many loyal investors to get back in if they wanted to.
1
Good opportunity to prove that Tesla is a viable company and not just a gathering of members of the Cult of Musk. Tesla should continue to do well.
Full disclosure - I own shares of Tesla.
2
Maybe he can now focus better on the Boring Company and his other ventures, and maybe his successor at Tesla can fix Tesla's problems.
1
I appreciate what Musk has done, and the Tesla is a terrific car. Big thinkers often have failures as well as successes, and that is to be expected. Time for him to step back and reassess. What I don't get is that Musk, Richard Branson, and now Jeff Bezos, are focused on space. It astounds me that with all their money, they could really do some good on earth.
12
I'd like Elon Musk to -know- something when he falls asleep each nite. His loud mouthed foolishness was all I needed to know I would short Tesla till the End Of Time.
4
While the rest of us worry about finding the income to register our cars, cats, and dogs, Elon Musk is fined $20 million and responds by buying $20 million in equities.
Take a moment to savor this tech bro's pinache. Envision your life as a billionaire, like him. And then make sure you vote your conscience in November.
8
Mr. Musk's experience calls to mind the age-old story of the farmer, the mule and the two-by-four.
https://www.psychologytoday.com/us/blog/management-rewired/201005/changi...
Oh great; whatever you do, don't show this to Donald. He'll try to come up with a $20 BILLION dollar tweet, so he can continue to hold supremacy in all things.
3
None of these guys are geniuses. Musk, Zuckerberg, Jobs, Gates... although Bezos comes close. They're all muscle men, opportunists who stepped to the front with other people's ideas. They were the most ruthless so they won their games of monopoly. Like Trump or Putin. Not the best at all, but really the worst. And in the end what are they good at? Cheating to make themselves look good. The things that brought them wealth and fame. That's not genius.
The real geniuses of the techno industrial age were Edison, Bell, Tesla, Ford. The Wright Brothers in their bicycle shop. That was when the American dream machine held forth and the spirits of inspiration and innovation were still alive and well.
Today's techno moguls are mere impersonators.
14
Now, if only we could sanction the president of the United States for his lying tweets as easily as we can do that to a corporate titan like Mr. Musk!
7
So this perceived visionary and billionaire broke the rules and was fined. Why so many apologists for what appears to be a man in way over his head? He’s great at conceiving of grand plans, he’s a terrible CEO of a public company. (Oh, and he did show sound judgement by letting actual rocket scientists operate SpaceX, hence its stability and success.)
Would readers and investors be so forgiving if the same behavior was exhibited by the chiefs of GM, Ford, FCA, VW, et al? The companies that actually turn a profit.
8
If the SEC is so interested in misleading tweets, I have a suggestion regarding where they might find a whole lot of them...
7
I have been a big fan of Elon for years, bought one of his cars. In the past he has just talked too much. His PR people should keep him off social media.
6
Hopefully this will enable Mr. Musk to get back to the work he excels at; being creative and breaking new ground.
Francis Bacon, the "father" of scientific method, charged with 23 counts of corruption, was sentenced to a fine of £40,000 and committed to the Tower of London at the king's pleasure in 1621.
Mr. Musk is a smart man and I look forward to following creative career.
Perhaps after he returns from a relaxing, extended vacation.
7
Who gets the $20 million? Does it pay for subsidized school lunches? Or politicians' trip to the Bahamas?
9
@Robert Ebbs
The Senate will blow it on catering for committees.
When you sit and talk all day, even a "Senate Day" of roughly 3-4 hours, about things that will never get done, you still need lunch.
1
"Mr. Musk was said to have backed away from a settlement, in part, because he was concerned that he could not later tell investors that he had not done nothing wrong. But the settlement on Saturday requires him to do that.
"In a so-called “admit nor deny” settlement, a settling party cannot later disavow the terms of the settlement."
You should've checked that with a lawyer. It's completely wrong. Neither side admitted nor denied anything. They just settled. Each can spin the underlying facts however they choose - the only thing they can't deny is the settlement itself (actually they can deny that also but it won't exactly be credible....).
1
This is another example of the strong arm tactics and coercion the SEC employs to make people settle on their terms. In particular, the provision that Musk did not like, the one where you are not permitted to explain why the SEC side of the story is incomplete and misleading, is one that is very important to them. In these settlements, they write the “facts” and you have no ability to disagree or correct their view of what is the truth. You can be sure there is exculpatory evidence that will not be included in the settlement documents and so he will forever be at a disadvantage because they took advantage of their power to threaten to ban him for life.So when he did not go along with their slamdunk, they doubled the penalty. They are small minded people desperate to get even with the people they know are better than they.
8
Musk, slightly more entertaining than Trump and far less dangerous.
An auto revolution with models starting at $50,200 and going up to $109,000? What a joke.
5
SEC did nothing to all of the fat cats after the 2008 financial crisis who basically lied and cheated and caused the "great recession" to the world.
In fact, those bankers got millions of dollars of bonuses and bailouts and became secretary of treasury.
Trump constantly tweets out lies, slanders, threats, and yet no consequences have befallen him. indeed he is the most powerful person in the world.
Yet, Mr. Musk tweeted one tweet not completely in line with reality, he is forced out of chairmanship of his own company. One has to wonder who is behind all of these: big oil companies feeling threatened? other traditional auto companies? or maybe simply some big hedge fund managers losing money because they were sorting his stocks?
Perhaps it is also simply pure jealousy?
This whole event makes me feel sick for this world. Someone like Elon Musk could be ousted so quickly for one mistake yet so many others "get away with murders".
I have no respect for the Wall Street vultures who lost some money and is out to get blood, or for SEC who is totally in bed with Wall Street fat cats, or for the oil industry with no regard for the health of this little planet.
It is a sad day to hear stories like this and many others.
24
That was one expensive tweet!
5
This is so interesting, is it not possible that Elon has done all of this so he can now put all his attention on SpaceX, without losing to much interest with Tesla, what I see here is a win win situation for Elon Musk.
2
Well, S.E.C are doing great job recently.
Elon Musk, something is going on with this man.
2
How disappointing! I was so looking forward to seeing him in an orange suit.
1
He’s a lucky man. This is a sound slap on the wrist to a smart person with a public company for thinking out loud. Ill advised. The SEC does this for many reasons but number one is “You May not unfairly or adversely effect the stockholders or the market as a whole.” And since no one can really assess that risk, acting in a manner contrary to the good of the public or stockholders will do it. Yikes! This is a guy with a missile that has two fuselages that upon emptying return to earth and land upright on the launching pad. The SEC has no idea what he has in mind for Tesla. It’s all about the risk. And managing it. Further, if you take your company public, it’s not your company anymore. It’s public! I have been through three takeovers. And served on a risk committee forming a new security with the SEC. As with all things American, it’s about the good of the people, investing, in this case. Musk, sshhh.
8
What makes Tesla valuable They are not profitable at all. They are as profitable as all those companies that advertised during the 2000 Superbowl but did not advertise in 2001 due to not existig anymore.
I don't think there's anyone who thinks badly of the man. Everyone seems to agree with what he has been attempting to do (for us all).
Myself I admire him for what he has done, and is doing. His dreams are truly laudable; even epic. He represents, to me, some of the better aspects of our nature. His legion of fans and minions who support the dreams add further proof that others feel the same. So I'm glad this shows he has not completely lost his mind.
One has to consider that as a consequence of all that he (and his legion of supportive minions) has taken on he has also been enduring a mountain of stress. Stresses that would crush even Hercules. It has been upsetting to see him crack, so publicly.
The man has been in melt-down mode, right before our eyes these last few months, so again it's good to see this. Now...can someone further advise him to take a vacation? Go on sabbatical? Get away from everything; and don't come back for 6 months? Don't tweet; don't even look at anything. Spend time in repose.
We're all the better for his dreams; so take a break and come back recharged. His minions can continue the dream in the meantime.
Just some thoughts worth about that much.
John~
American Net'Zen
8
Alan Mulally. He did a very good job, I thought, giving Ford a face lift. Earlier he worked for Boeing so he knows a thing or two about flying machines also. Maybe he could contribute at Space X as well.
3
So I am pleased that they were able to come to terms. But I am concerned that once again if you have money you are able to get out of jail. It would seem to me that if we are going to have a system that allows for paying to stay out of jail with agreements. We need to have a sliding scale. So that even the poor could make deals instead of just the wealthy.
4
@oscar jr So people who have no money at all can do whatever they want, since that sliding scale would be $0 for them?
1
@lakawak
This is a civil case not criminal. So no they can't do what ever they want.
Well, it would not have to be for zero dollars if the wealthy just paid a fair share in tax. If a person earns $129,000.00 this year , they will pay as much in FICA taxes as Warren Buffet. BRILLIANT just keep voting Republican and all your troubles will go away!
Mr Trump would appear to benefit from the oversight of a couple of experienced directors whenever he logs in to Twitter.
4
This appears t be a slap on the wrist, saving face for the SEC, but not imposing any meaningful penalty. An egregious violator stays on as lead decision-maker after the most obvious stock manipulation imaginable.
4
It is a sweet deal for Musk and Tesla.
Had Musk been another mediocre CEO, SEC would have had more blood. Perhaps being a cult hero and a genuine innovator, in one sense anyway, has its privilege.
If the board still has nothing after, Musk and Tesla are nuts! Sadly, they might keep the status quo. After all, Musk has managed to escape a harsher fate and this might embolden him instead of treating it as a warning shot
1
@Bos Being a mediocre CEO would be a step UP for Musk.
2
Hey in two more years we can have cars powered by coal and re-elect a president who would think that was a great innovation.
9
Musk may be a genius, but he has recently become scarily grandiose and apparently assumed he could get away with anything. Admitting he set that $420 a share price for Tesla to "impress" his rapper girlfriend because of the significance of that number in marijuana culture? Is this really who you want to be your CEO? I'm hopeful this settlement will bring him back down to earth and that he can get the help he obviously needs. And let's also hope his girlfriend remains impressed.
11
@Bob G. How is he a genius? His SOLE success in life was to create the world's most hated internet payment website. Even other endeavor has had absolutely ZERO basis in science. Or reality.
1
The new Chairman of Tesla should Tim Cook. Elon Musk should work for Apple as creative advisor. Tesla cars should use iOS for its user interface. Stockholders of both corporations would love it. Apple would gain the creative energy it lost with the death of Steve Jobs, while Tesla would gain a chairman who is expert on marketing and production.
5
While I’m in favor of smart regulation to protect consumers and investors, it seems that the sec overstepped here. First, it never seemed to anyone with any sense that that tweet was to be taken seriously and at face value. There’s a fair bit of hyperbole involved with everything Musk has ever said, and his statements usually convey goals, rather than facts. I get why the sec feels like he went too far. But second, and more importantly, if the goal of the sec is to protect investors, this had the opposite effect. This caused stock prices to plummet and erased billions in market value. The sec shouldn’t be destroying market value or destroying companies. That’s not the point.
3
It is illegal for someone in his position (chairman and ceo) to broadcast market moving statements publicly. There are rules which govern stock market disclosures.
16
@Michelle
Not true. Check you facts. He just can’t say something that isn’t true. Earlier filings with the SEC 10Q’s and 10’Ks contained disclosures that Musk would from time to time make disclosures on Twitter.
Good outcome overall. Elon cannot do it alone and no mere mortal could. He seemed to be fraying at the seams under the pressure. Tesla is making history despite the myriad status quo players gunning for Musk and the company. A professional Chairman could bring necessary stability and credibility.
10
@Kevin What history are they making? Electric cars? Had them over a century ago. HE is "fraying at the seams because he has absolutely zero science background and has no idea what he is talking about most of the time.
Just curious:
Where does the $20 million go?
Into the SEC’s general budget?
What will it be used for?
16
@WeVo Make SEC Executives wealthier?
1
Maybe Musk should take a lead from the late, great Howard Hughes. Hide out in the top floor of some hotel, live in obscurity, and communicate nothing to the public.
While your company goes forth on the cutting edge of everything it does.
10
There is a difference between speculating traders and actual investors. Those who may have been misled were the traders.
By taking this action last week when it did, the SEC caused a 12% drop in stock price in after hours trading. Seems to me that harmed investors and aided traders.
I expect the weekend settlement to cause a spike in stock prices come Monday. Harming the short sellers far more than the Musk tweet.
20
@RM I couldn't have said it better.
1
@RM You should probably point out that you have never taken an economics course in your entire life. Although that is obvious.
1
The long-awaited Epic Short Squeeze starts on Monday.
9
"The company, whose shares have been hit hard since the S.E.C. filed the lawsuit, did not immediately comment on the settlement." Because it didn't have to . The market had spoken; it voted "no confidence" in Musk -- and the settlement, divesting him of operational control, quickly followed. If only our political democracy worked as well.
8
Cool. Now go get Trump for his market bending tweets...
They did exactly the same thing.
75
Sooo tired of Elon Musk, sheltered little spoiled rich kid who has a case of entitlement as big as Alaska. So sick of his tantrums.
17
Are you kidding? This is a guy who built up several companies from nothing using the sheer force of his will, working long hours and likely shortening his life. "Entitlement" is about the farthest descriptor from the truth I could imagine. At least his companies make something besides money and push technology forward - the kind of rich people we need, rather than the trust fund do-nothings.
8
the obvious choice would be steve jobs...
3
From an unconscious perspective now Mr. Musk can blame the failure of his massive hubris on the SEC.
4
"that he had not done nothing wrong"
As minus times minus equals plus, that could be rephrased as
"that he had done somehing wrong".
Is that so?
3
@Markus Jordi
Yes, but you left out an important part: "he couldn’t later tell investors that he had not done nothing wrong." In other words, the deal doesn't exonerate him; he may still someday have to publicly acknowledge that he did something wrong.
4
It's an egregious editing error plain and simple. He didn't agree to the settlement because he couldn't then tell investors he had done nothing wrong. Or because he couldn't tell investors that he had not done anything wrong. In any case, his desire was to convey his blamelessness to investors. "… that he had not done nothing wrong" is just bad grammar, no matter what the author intended to say, and not because the grammar police say so, but because it is confusing to readers.
Where are the NYT articles on the spectacular sales numbers of the Tesla Model 3?
They sold almost 20 000 in August alone, the most successful new car launch of the year by a long shot. The fact that the Model 3 is 100% electric and Made in the USA only adds to this amazing story that for some reason is not yet being told?
87
@SW
So what? Honda has sold more Accords and Civics than that, every month, for decades. Same for Toyota Camry & Corolla.
14
Those are not 100% electric cars, and they are not American-owned... Tesla is the kind of company we're always lamenting we don't have in America anymore: manufacturing, innovative.
12
His comment was 20k in a month from a “long shot” auto company. And Made in America (rather than global assembly). Different from Automakers you mentioned.
He needs a break
8
If I was a Tesla shareholder Musk on YouTube smoking pot would make me nervous. Not for the pot smoking but for the bad judgement in posting that on YouTube.
36
He got away with, basically, a murder. But, remember the fate of Apple without Steven Jobs. Tesla his year sold more vehicles than Mercedese and BMW combined. It seems despite Musk's mistake there is stench of politics.....I think GM, Ford, Mercedese etc are scared of .......who else the American genius. I got my Tesla a week ago.....the best car I have ever driven....I'm 67 years old and have driven MBs and BMWs since1995.
22
@HCJ
The latest figures I have seen show Tesla August sales (estimated) at 10,000. BMW and Mercedes combined were nearly 50,000. How is that more?
4
@HCJ
"Tesla his year sold more vehicles than Mercedese and BMW combined."
Nonsense. Completely untrue. YTD in the US alone, Mercedes sold 375k cars, BMW sold 305k, and Tesla sold 55k.
2
@HCJ Electric vehicles sales drop by a HUGE percent once the taxpayer handouts for buyers stop. And that is what is happening with Tesla. You are also, by the way, wrong about your claim. I expect you just made it up and hoped no one would call you on it. But you are old enough to know better.
3
Mr Musk, just go private. Get Tesla rid of all this nonsense.
13
@Alfaeco Musk should have fired all the directors. Musk must be Musk and nothing else.
7
Motorcycle companies build what amounts to super cars on two wheels. Every bit of exotica the latest and greatest futuristic can be found in those bikes and they sell them for a mere pittance of 15 to 20k. They also sell bike a quarter of cylinders and tech developed 30 year ago for 5k. Some one has to absorb the cost. The sports bike crowd want affordable bikes.
I was looking at some of the top Japanese auto companies hybrids. They are moderately priced. How's that with what amounts to two drive trains? They can charge alot for for Highlanders and Pilots to pass on the cost of electric and hybrids which cost much more to produce.
Tesla can't bring down the price of their by selling cheaper cars for more money than they are worth. How can they remain competitive when all they can sell is expensive cars?
5
Their competition sells slightly cheaper cars. the feds should give the buyers more breaks to preserve our environment.
7
@Tom
Don't get me wrong. I don't want to see people lose their jobs at Tesla but GM, Nissan and every auto company make credible electric and or hybrid cars. If you want to save the environment.
Unless you're virtue signaling.
@Tom You want to give other people money to buy a car...go for it. But no...that is NOT what governments should be forcing taxpayers to pay for.
I suspect that the SECs moves here have a lot to do with behind the scenes players who are out to get Musk and Tesla for one reason or another. I don't usually buy into conspiracy theories, but with all of the big money players who stand to lose from the rise of electric cars (not to mention the defense industry who has been overcharging the US taxpayers for rockets for decades), it seems quite likely that some behind the scenes maneuvering led the SEC to their actions. Note that the SEC did almost nothing to financial and bank leaders during the great recession even though many of their companies hurt millions--harm that will get passed down to generations of children. Anyone who follows Elon for even a short period of time, knows that his posts are often wishful thinking or suggestions. I saw the take private post and thought... maybe he would do it, but it's just Elon talking at this point and not something that I would act on. I'm not sure why others didn't see the same. Misleading investors? Only if they are either really out of touch with Musk, or want to make a case against him. For context, I'm not a stockholder, but I am a very happy owner of a Model S. Teslas make every other vehicle feel primitive. SpaceX puts the other rocket companies to shame.
49
I so agree with you: someone is out to get him.
1
This is positive news, both for Tesla and for society. Naysayers need to understand that Tesla is pushing entire industries to innovate in ways that help advance sustainability. Believe me, were it not for Tesla, you wouldn’t see MB, Porsche, BMW, Audi, and others invest in EV’s the way they now are. They have a ways to go in catching up, but either way, it’s great to see the investment and focus in this space.
We need to stop using fossil fuels not because we finally ran out, but because it no longer makes economic sense. EVs are part of the formula. Reducing and hopefully eliminating fossil fuels will make the world a far better place in innumerable ways.
17
@J If it doesn't make sense, then how come taxpayers have to pay $7500 (and more than $10,000 in some states) just to get people to buy Teslas.
PLEASE tell me you are not dumb enough to think that once those incentives dry up (and they start going away in just 3 months) that sales will not drop significantly.
4
Elon Musk appears to have the negotiation acumen of Trump
14
@Lostin24 Yes, it is a very bizarre situation. On Thursday he turns down a settlement offer, is then sued, and 2 days later he settles for a worse deal than he was offered on Thursday.
14
@Bob Rossi
I usually don't subscribe to conspiracy theories but in this case I'm tempted to say that maybe, just maybe, Elon set a trap for the shorts on Thursday. The stock will explode on Monday. Shorts that didn't exit their positions on Friday, will be in trouble.
3
This might turn out to be a positive in the long term. Shareholders still get Musk’s visionary leadership, plus a tad more perceived discipline in financial management. It might also help them attract more talent to help run the show, as well as entice a few additional strategic investors to keep it going strong. Elon Musk should take the positive potential of this deal and just run with it. Don’t look back, only ahead. Leave all the sulking to auto executives in Detroit, Germany and Japan.
27
He has committed a crime.
What do our laws stand for if the wealthy are not prosecuted?
They stand for the powerful and fall on those who tread against the powerful.
21
See 2008.
3
The SEC filed a civil lawsuit, not a criminal lawsuit. Not every violation of the law is a "crime."
9
@Alfred Stanley
A white collar crime is still a crime. Stock manipulation is a crime.
Quashing the electric car has been at the top of the old line auto makers and the Middle East oil producers. When oil prices dropped a few years ago the Saudis were using their massive reserves to drive the growing hybrid car market out of business. It didn't work because Americans had become used to oil companies using cheap prices to drive shoppers into behemoth SUVs and trucks. A lot of us remember when it cost a hundred bucks to fill a tank in a family sedan and weren't going to be fooled again. If I needed a car I would definitely be looking into a Tesla. If the power that be can't win in the market place they will always drop back to use their power with the regulators to drive competition from the field. I don't know if Musk is a genius or not but he certainly has the right product at the right time.
11
Do I get a whiff of reaction by the established corporate state here? Like Tucker, he upset a lot of comfy folks who had it made.
8
@George Kamburoff
One man's conspiracy theory is another man's helicopter engine drop into car.
1
As always, there's a different system of justice for elites...a slap on the wrist. What about the shareholders he essentially defrauded?
30
Class action lawsuit?
3
@Barry Ancona I believe one has already been filed. I think I read that early on. I don't know if it has moved forward since, but I don't see why it wouldn't.
You mean the parasites that make their money betting more useful people will fail? The law was meant to protect investors, not leeches on society.
1
This is good news for Tesla as a company. German sociologist Max Weber would have described Elon Musk as a charismatic leader, someone whose authority stems from the sheer strength of his vision. The problem with charismatic movements is sustainability - organizations need rules, stability, regularization, and an identity that’s distinct from a single individual - even one as singular as Musk. As long as Tesla remains attached to Musk’s ego, the company is vulnerable to his moods (as we’ve seen). Time to grow up, Tesla, if you’re going to realize the transportation revolution that Musk envisions.
37
@Laura It wasn't his "vision." He neither founded the company, nor invented the eponymous car.
20
It is a reasonable deal, and hopefully the board will get someone who actually knows how to produce cars, including all the details. If they get that he or she will need a team. Who does not plan for transportation of their vehicles to the owners?
1
This is good news for Tesla as a company. German sociologist Max Weber would have described Elon Musk as a charismatic leader, someone whose authority stems from the sheer strength of his vision. The problem with charismatic movements is sustainability - organizations need stability, structure, regularization, and a source of authority that’s distinct from an individual, even one as singular as Musk. As long as Tesla remains attached to Musk’s ego, the company is vulnerable to his moods (as we’ve seen). Time to grow up, Tesla, if you’re going to realize the transportation revolution that Musk envisions.
4
How does this remedy make whole the investors - mostly retail - who collectively lost billions after buying TSLA at falsely elevated prices after "funding secured"?
I don't see that it does at all. It seems to let Musk off the hook for that. Or am I missing something?
27
@Mother Ocean The stock market is Russian Roulette. Nothing is due to “investors.” They are victims of their own greed.
11
@Mother Ocean
This is only a settlement between the company and the SEC. The investor lawsuits are not affected by this; they will go on separately.
6
@Mother Ocean
THE Fiat 500 sold 50k the first year. It was a cute car a fashion statement. The second year about 5k. There were only so many people who wanted one. How many want a Tesla. Maybe the investor should have known better.
Unless they can explain why Ford trades at around 10 Toyota around 12x and Tesla 25x more.
Toyota allways returns to ridiculous levels when the market bout car back. Just saying.
This one man - a very successful man - is being hit harder than a great many before him. This smacks of a certain grudge bias against him like few have had to face.
Musk is no saint, but the campaign against him has been surreal!
Consider: it’s ONE TWEET. One.
Now: compare that to our lying, raging, bullying President... completely ignorant and vastly out of control with domestic and international policy, treaties, economics, tariffs, and more. He’s run the Executive Branch as his personal vengeance machine and money maker. He’s upset Decades of the World Order, a system that took trillions to create, countless lives to secure, and the efforts of several generations. He hasn’t a clue what he’s doing.
Lies. Ignorance. Mental Illness. Narcissism. Breach of Oaths. Bullying. Abuse. Profiteering - and almost daily Twitter meltdowns that shake the world...
And. He’s. Still. President.
The double standard being exercised by our own government is so far past shocking, ironic, and grotesquely hypocritical that it can almost not be intellectually grasped. A truly successful billionaire is reamed. The nutjob in the White House is still raging on!
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@GWBear You don't appear to understand how things work. Tesla had filed notice to use social media to disseminate official company news. That "one tweet" moved the market and caused lots of ordinary retail investors to buy TSLA at what is now a huge loss.
Hero worship and investing usually don't go well together.
42
@GWBear How foolish, one is president with a job that includes politics and keeping your political promises. The other is a CEO of a public company with all the rules that come with that position. Surely you know the difference, but perhaps not.
23
I also wonder if the big car companies have any influence in this, since Tesla is a threat to their business model.
1
“The terms 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.”
Gosh- do the 1 percenters really think that $20 million is only “slightly tougher” than $10 million” ?
6
@Chris Jones
Yawn - and this affects you - as I assume a non-share-holder in what manner or fashion?
People worrying about other people's money is the plague of the 21st century.
1
So not being the chairman - does that mean he can't attend board meetings.. as a wall flower, for instance?
1
You must have missed this in the article:
Under the deal reached on Saturday, he will not only remain as chief executive, but will also stay on as a board member, just not as chairman.
1
Next step: Twitter needs to shut down the accounts of both Musk and Trump, who use the social media juggernaut to bully and manipulate others...
11
@J. Grant Why would they do that? And the government is not legally able to do so. How about you just purchase Twitter and do whatever you desire?
3
@vulcanalex The government is not legally able to do so because of the First Amendment, which doesn't apply to a private company like Twitter. Or don't you know that?
1
Are you advising that the government violate the 1st A against people you don’t like?
1
It is a shame that Musk's publicly bad behavior is overshadowing Tesla's success at the moment, given that they've just passed their ambitious third quarter production target of 50k Model 3s. Surely this ought to be great news for investors, and yet TSLA is dropping like a rock. If Elon really believes in the importance of EVs for America's energy future, then he has a responsibility to do whatever it takes to keep himself out of the headlines. Hopefully this decision means that he thinks so, too.
19
Disruptors/innovators have different habits of thought and behavior than managers---rarely have I worked with an individual who skillfully combined both skill sets.
12
Characteristically, Elon Musk arrived at a settlement with the S.E.C. “instantly” because he is simply uniquely focused on his extraordinary talents to get things done without wavering from his primary goals. We should all be reminded of the S.E.C., the Feds ( and of course the entrenched BIG THREE) and their combined efforts in the late 1940’s and early 1950’s that ruined the energies and innovations of Preston Tucker and his unique automobile. Preston Tucker defended himself and was ultimately acquitted of all S.E.C. charges but, merely being prosecuted by the Feds, based upon flimsy allegations, nevertheless brought about irreversible financial ruin and the demise of a great innovator’s dreams. Elon Musk cut his losses, accepted a deal and in thirty six months he still be back on top and headed for greatness. Admittedly, I’m a TESLA and SPACE X fan. No sense denying that. Keep your eye on Musk and support him if you can. Ultimately it’s going to be a spectacular and exciting journey.
21
@Michael J. Muller Cslm yourself, sir. He didn't even start the company, and his behavior is going to torpedo it.
8
@Michael J. Mueller I agree with you, especially regarding Tucker. And I have no doubt the BIG three (as well as foreign competitors like Toyota), with their own shabby attempts at electrical vehicles, had something to do with this move by the S.E.C. who has always leaned toward established corporations to maintain the status quo. Attitude fossilization is a hallmark of the S.E.C.
Tesla needs to be careful not to hire "someone who understands how to build cars." The big three were hit hard by the Great Recession due to old attitudes and ineptitude. Chrysler was owned by the Germans prior to the recession - now it's owned by the Italians (by Fiat which had all but disappeared from America because they cannot build to our standards). Note, with the disassembly of the E.P.A. by Trump, foreign junk cars will once again find homes in our driveways. Regardless, it's pretty obvious knowing how to build cars the "Big Three" way is not going to help an innovative company in any way - it would shut them down, just like Tucker was shut down with collusion by the S.E.C.
The Tesla board should plead with Elon Musk agree to be the unquestioned conscience of any new "chairman" and that the new guy's sole responsibility be acting as the front man to assuage the investors and government.
1
While it's definitely a good thing that Musk will remain as CEO, it's a travesty that Elizabeth Holmes, the Stanford dropout/ fraud extraordinaire, got only a $500,000 fine for defrauding investors for $billions.
Musk has produced the most well known electric car company in the world, helped restore a defunct auto assembly plant in Fremont and employs thousands of Americans, is on the cutting edge of battery storage with his deal with Panasonic and is pushing the boundaries of private space flight with Space X.
On the other hand, Holmes just flapped her gums, told people she was from Stanford and watched gullible investors, including current Sec. of Defense Mattis, open their pockets to enrich her. Walgreens severed its contract with Theranos for faulty test results, possibly endangering the lives of actual patients who rely on these tests , and its Edison blood testing machine is a pile of vaporware.
Yet Musk paid 40 times more in fines.
Is this justice?
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@Mark
Ms. Holmes is probably going to prison for fraud, as she should. Mr. Musk may be a genius, but he should seek counseling. Anyone who brags about only sleeping four hours a night as a matter of course is headed for burnout. My opinion is that he's already there. This action by the SEC could be a blessing in disguise for him and his companies.
16
@Mark
It's not the first time a bunch of old very rich mostly white men got snookered by a good looking blonde. First, by investing millions in a fraudulent firm and then with a slap-in-the-wrist fine. Some commentators think Ms. Holmes will do prison time. I'll believe it when I see it.
4
@Mark Theranos never went public & tho valued in the billions at peak only $700M invested per Wikipedia: Big qualitative/quantitative differences with Tesla and for SEC (was it securities fraud for Holmes? didn't check). Glad to hear of prison possibility @Linda and glad none for Musk. No talk here of what the tweet cost the shorts but I expect a lot more than $20M that day; and Tesla/Musk may well face more in civil court on that front.
I'm sure he is a very talented and brilliant man. I don't know why - this is purely instinct. There's something a little off with him. I've thought so since he first came on the scene. I'm sure he's laughing all the way to the bank.
11
@DHEisenberg "There's something a little off with him." That might be true, but it wouldn't be the first time that someone in his position was a little off. For example, Steve Jobs.
4
I agree, he did something egregious. But isn’t he getting a more severe penalty than nearly all the individuals responsible for the debacle that was the Great Recession, causing U.S. taxpayers to bail out companies, and who affected investors worldwide and the global economy for nearly a decade?
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@Anonymouse His was BLATANT and egregious. The mortgage and derivative meisters were spread wide and cumulated; and the enforcers were concerned about bringing down the whole house; still, I too wish more had been done on accountability; much HISTORY still there to be researched and written, politics to be waged.
3
This is a mere slap on the wrist of both Musk and Tesla.
However, it will not slow down the implosion of both.
See https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-s... ("Is The End Near For Elon Musk And Tesla?")
8
@Timothy D. Naegele Tesla will probably not last long, but Musk has many other ventures besides this. SpaceX being the most successful. You can get lost with your agenda against him
4
@Timothy D. Naegele
I especially enjoy when people reference blogs as sources of financial enlightenment.
No one forces anyone to invest in Tesla - you don't believe the story - then don't invest - the miracle of a free market is that you can pick and choose your investments.
2
@SteveRR It appears to be his own blog, just elaborating and promoting. That seems fine to me.
Elon is a genius. Tesla and SpaceX would not exist without him. I’m a TSLA and a Tesla owner, and a big fan of Elon, but his recent shenanigans have cost me many $10,000’s. Still, keeping him as CEO is the right thing to do, but he cannot do it all. Getting competent support in management and production will be critical to Tesla’s success.
63
A genius would not have dropped the deal only to accept it again at a higher price. I'm sure he's a smart person, but why is everyone calling him genius is beyond me.
24
@Moshe
He created and sold paypal - he has a company that puts stuff in space - he builds electric cars that people put down multi-year deposits to purchase - he has a solar and fuel cell company that may just revolutionize local power grids - he may yet revolutionize city-to-city transport.
On the other hand I am sure that you and I have accomplished similar feats?
1
@Ross Allen As a cautious little-nervous new holder and few $100s loser in TSLA of late I THINK we can expect or at least hope to recoup much of our loss on Monday. @Moshe A genius doesn't have to be (often isn't) genius in everything. The Thai rescue sub initiative certainly showed strengths and weaknesses; same here. Lessons learned I feel and hope.
My congratulations to Mr. Musk for resolving this issue so expeditiously and sensibly.
35
he had an even better deal 2 days ago, which he walked away from. How is this smart again?
3
@C Resor But he could have resolved it more advantageously 2 days before.
1