BayesWatch
8mo ago
It's totally plausible that Musk will ask for another similar contract. I think he's mentioned that. Getting from 50 billion to 1 trillion is much bigger deal than getting it from 1 trillion to say 5 trillion. He could reaosnably request a new contract where he's rewarded with options equal to 1% of the company for every 250 billion he adds to the market cap. It's more plausible than his last contract. He merges xAI with Tesla, gets Tesla's GPU business going, FSD seems to be making massive improvements in the past months, maybe robotics and boom, your at 5 trillion, it certainly more plausible than getting Tesla from 47 billion (which was seen as overvalued) to 1 trillion. So another contract like this is totally plausible.
BayesWatch
8mo ago
Yes, but in today's money talk, Matt Levine spoke about the tax implications of a new contract in Texas. In short, a new contract in Texas will have massively negative tax implications.
BayesWatch
8mo ago
Musk wasn't even working at the company full-time throughout the relevant time period.
During the relevant time period Tesla nearly went bankrupt, they had massive production delays and had set up assembly lines in tents, and Musk was sleeping in the factory. He could have been working at his other companies, namely SpaceX and OpenAI.
Sure, after that things were smooth sailing. But he could have spent his time on other stuff. If this ruling holds, Musk's current 17 or so percent of Tesla is worth about as much as his 40 percent stake in SpaceX given the current evaluation of >350 billion. There was a massive opportunity cost in spending that time at Tesla. Around that time he co-founded OpenAI, perhaps if he had more time to spend on OpenAI it would have been a better use of his time. Since the first ruling he founded a new AI startup that is currently worth over 50 billion dollars. In a very real sense, Musk could have created that much value in numerous other ways, his wealth wasn't necessarily as tied to Tesla as you might think.
More than that, it's unjust. When he made the contract it seemed absurd. He would take this horrible company and get rewarded for every 50 billion dollars he added to the market cap. It was a tremendous deal to the share holders, 1% of the company each time he increases it's starting value by over 100%. We know the opportunity cost of Musk's time. His other companies at the time included openAI, and SpaceX. There was in fact a massive opportunity cost, which is further demonstrated by xAI.
BayesWatch
10mo ago
I believe that there are degrees of bunker buster missiles. What they have isn't sufficient to get through the mountains near Tehran.
BayesWatch
10mo ago
They want US bunker busters sufficient to get at Iranian reactors under mountains. That is the existential threat. The only way Israel can get to the reactors is to use nukes. Israel's terminal value is preventing Iran from getting nukes. Forcing the US's hand is the only plausible way this happens. To this end they are incentivized to continue escalating in the hope that US has to join, and attack Iran itself, at least from the air.
Huge tax implications for Musk, also a large short term accounting hit to Tesla.
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