A weekly thread to discuss financial matters - from personal all the way up to global.
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Notes -
The conspiracy parts of the internet (i.e. the most entertaining parts) are freaking out about the SpaceX IPO and changes to various market indices that will be Bad News. This seems to the background. The S&P500 is not one of the indices, though, according to that link. Anything to it, or usual internet financial panic?
SpaceX is an overpriced unprofitable business and the type of fuckery Musk has done to push it into big indices is incredible, but the fact that literally everyone and their dog is aware of this makes me think it will be a non event. Some people are predicting SpaceX IPO to be a liquidity vacuum and the claim is not baseless, but again - literally everyone is aware of this and is salivating for things (ie semis and other shiny stuff) to go down because SpaceX is gonna print like 100 new billionaires and thousands of millionaires in the next 6 months thanks to insane valuation and fast unlock schedule. What's more likely to happen is all these guys waiting for a dip get left on the sidelines, coping that next big IPO, which I think is Anthropic, is what tips the market and gets them a good entry
The only reason Musks can do fuckery to push it into indices is because a lot of people want to buy the stock and will let him IPO 50+ billion at a 2 trillion valuation.
He personally will likely not cash out much in the IPO. And it really is a great company I would love to buy at some point. I am likely hoping that the mess up the IPO like Meta and I get to buy it between $500b and a trillion. Starlink has potential to be a cash flow machine. xAI is interesting but I have no idea if frontier models will be profitable and it’s going to burn a ton of cash. And SpaceX innovation is insane.
I won’t buy the IPO though unless I see an opportunity arb the indexes but I would really like to own it someday.
The bigger issue isn’t the etf inclusion it’s an issue that our biggest companies don’t go public now because of regulations (complicated). It should have been listed years ago. Valuations on it are tough but it’s obviously a very valuable company.
It is, but not at $2 trillion, or even $1t.
Are you sure this is the reason? I haven't researched much but it seems more like it's just +EV for them to milk the private markets for all they have and only then IPO and milk public markets.
Talking to my founder about it, one big reason is that people simply don’t want to be constantly at the mercy of twitchy stockholders who see your company purely as a Number Go Up machine and don’t understand that a ‘bad quarter’ can just mean people don’t buy ice cream in midwinter.
Plus the compliance costs are absurd, which ties into regulation.
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