By on October 5, 2018

Tesla CEO Elon Musk loves railing against shortsellers to the same degree that normal, regular people enjoy eating and breathing. As his company’s stock continues a downward slide initiated and perpetuated by Musk’s completely avoidable antics, the CEO decided that mocking a securities regulator and endangering a settlement reached on Saturday was a good and proper course of action. And so he took to Twitter Thursday night to make it happen.

It’s gotten to the point where young investors and diehard Tesla fans have taken to social media, begging him to cut it out.

After the Securities and Exchange Commission slapped him with a fraud charge last week, Musk eventually agreed to a settlement that would see him step down as chairman of the company. A independent director would replace him. Both Musk and Tesla would pay a $20 million fine. All of this stems from a fateful August 7th tweet in which Musk informed the world that there was “funding secured” to take the company private. You know the rest.

Musk and SEC representatives still need to appear in court together to finalize the settlement. And, for the deal to be done, the SEC must feel confident that it handed out the appropriate amount of punishment. In mocking the regulator, Musk seems intent on making his situation worse.

“I’m shocked,” Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware, told Bloomberg. “It’s only inviting the SEC to rethink the settlement. And it’s going to make it much tougher to attract independent directors to join the board.”

Stephen Diamond, an associate professor of law at Santa Clara University, told the outlet, “Reading the mind of Elon Musk is beyond my ability, but he is soon to join the SEC in front of a federal judge to defend the recent settlement agreement. If he doesn’t want to put that deal at risk he ought to pay attention to cars instead of Twitter.”

Musk went on to declare that shortselling should be illegal, then pressured shareholders to dump their stock if they had any doubts about the company’s long-term value.

Tesla’s stock fell 4.5 percent in early Friday trading, lowering the company’s share price to $269.10 at publication time. On August 7th, the stock ended the day at $379.57. Both Musk and the SEC have until October 11th to explain to a judge why they think the settlement was appropriate.

So far, the SEC has remained silent on Musk’s latest outburst.

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58 Comments on “Facepalms Reverberate Across America As Musk Mocks the Regulator That Has Him Over a Barrel...”


  • avatar
    DeadWeight

    Musk is a sociopath.

    I’m not even joking.

    Tesla is in even more precarious financial health with each passing day; the more vehicles it produces and delivers, the greater its losses.

    And it now is very difficult for Tesla to replace cash that it is losing from “vehicle sales” by selling bonds due to its junk credit rating in an era of rapidly rising interest rates.

    • 0 avatar
      FreedMike

      Sociopath or just touched? Good question for a shrink.

      Either way, the guy needs to lay the f**k off Twitter and the weed.

    • 0 avatar
      Middle-Aged (Ex-Miata) Man

      I’m starting to think you’re right, DW. Musk’s recent behavior goes beyond mere delusion or narcissism.

      I don’t really care if Tesla lives or dies (I’d prefer the former) but keep this clown the f**k away from SpaceX. He’s already threatened to doom what has become an extremely successful launch provider with delusions of the BFR and Mars.

    • 0 avatar
      Dawnrazor

      I’d say he definitely exhibits some possible antisocial personality traits (the terms “sociopath” and “psychopath” are no longer used clinically), but looking at his longer-term behaviors, some of the more overtly grandiose statements he has made, and recent behaviors which telegraph a marked lack of judgment and insight (such as flaunting the pot smoking) I actually perceive more of a mania flavor than a personality disorder. (Plus, Antisocial PD has a marked lack of empathy and respect for the rights of others as hallmark features, and I don’t perceive that this really applies to Musk; sure he has done/said some whacky things and has even been involved in some ethically questionable business practices, but I don’t believe he would remoreselessly harm or intentionally violate the rights of others.)

      • 0 avatar
        highdesertcat

        “he definitely exhibits some possible antisocial personality traits ”

        Most brilliant people do.

        Achievers also gravitate to megalomaniac views of everything around them, seeing much of the world outside themselves as trying to undermine or sabotage their best efforts. And often they are right. Jealousy and envy are negative forces aimed against creative people.

        No matter what else he is, Elon Musk is a proven performer and achiever.

        The SEC OTOH, not so much. Just review history for the performance and effectiveness of the SEC.

        • 0 avatar
          FreedMike

          +1, HDC. Patton was a prime example. I’ll go with the current president as another. These folks figure they either a) go down 100% in flames or b) 100% in glory. There’s no in-between.

          Problem is, when they go down in flames, everyone who is associated with them goes down too. And if they’re left completely to their own devices, going down in flames often becomes a self fulfilling prophecy. Ironically enough, it usually happens right after they achieve some kind of smashing succees – their egos run completely away with them, and they end up doing something counterproductive.

          And when that happens, everything they want to achieve ends up overshadowed by their behavior.

          The truly successful people like this WANT people around them who can “rein them in,” so to speak. Musk DESPERATELY needs someone like this in his court. But the same ego that says he can do anything probably also tells him he can do no wrong.

          • 0 avatar
            highdesertcat

            Right on all counts, FreedMike.

            The mistake that was made as I see it was not Musk’s “intent.”

            It was Musk’s failure to understand the Arab mind and its intricacies when it comes to public exposure. Arabs prefer to be low-key, behind-the-scenes financiers and manipulators.

            So, the Arabs took their money elsewhere.

            But Musk had the right idea, the right intent to get the massive Arab wealth behind Tesla at the exact time that the Arabs were trying to diversify their international investments AWAY from OPEC and oil.

            I think he is kicking himself everyday for botching this lucrative venture.

          • 0 avatar
            FreedMike

            That’s what I thought too. I don’t know much about business dealings with Arabs, but I found it very, very interesting that they would be investing money in a company that, if successful, would undermine the one industry that keeps them in from descending into Syria-style madness.

            I think they’re looking forward to a day when oil isn’t king anymore, and that day may be closer than we think. In the end, it’s about energy delivery. If the oil companies were smart, they’d get behind stuff like fusion and other alt-energies, stat. It’s a better mousetrap, and typically those end up making you rich.

          • 0 avatar
            highdesertcat

            Yup, you’re right.

            FYI, in case you don’t already know, I am for the simultaneous development and implementation of ALL sources of energy generation to include wind, solar, nuclear, wave, geothermal in addition to existing use of coal, oil, natgas and the burning of wastes to generate power.

          • 0 avatar
            JimZ

            “Problem is, when they go down in flames, everyone who is associated with them goes down too.”

            not only that, it’s Someone Else’s Fault it all went down in flames.

          • 0 avatar
            FreedMike

            @Jimz: +1

    • 0 avatar
      Lockstops

      IMO he doesn’t even have to have anything else than a fixation on his vengeance on short sellers for this to snowball. SEC just got in the middle of his vendetta against short sellers. He absolutely hates the short sellers. He wants to destroy them. He probably equates them as the flipside of his success = either they win or he wins.

      That’s my take. There could be more, probably is, but what is clear is that he absolutely hates those short sellers, either all of them in general or one or a few of them in particular. They somehow got under his skin. Could be that someone was at a cocktail party or even a Tesla event and laughed in his face about their shorting of Tesla stock and making money off of it.

      In any case Enron Musk doesn’t seem to take criticism well, as the case of the ‘paedogate’ goes to show. _Lots_ of people in this world have an unhealthy relationship with criticism, and it can get really ugly because such a seemingly small thing escalates really fast really easy (to them it can feel like ‘if only they just wouldn’t criticise me then all would be well but of course that’s a sick way of seeing things).

  • avatar
    Stumpaster

    It’s probably the same “investors” who want Tesla to produce a brown station wagon with stick shift.

  • avatar
    MrGrieves

    The price of TSLA isn’t the big problem, it’s the rapidly maturing debt issuances. Looks like there is a convertible debt on 2/27/19 that is coming due – at today’s stock price it would be better for the debt holders to not take the TSLA shares and just go for cash, which would require Tesla to come up with $900M on 2/27. They could issue more shares, or float another bond issuance…

    • 0 avatar
      civicjohn

      The conversion price is $359/ share, he can pay with shares if is trading at that point. If not, they have to pay with $$.

      I’m amazed he would do something like this, the SEC may decide he needs to bring some more pocket change to the court proceedings.

  • avatar
    EBFlex

    As I said, the Fraudster is a cancer and will continue to do damage to Tesla.

    He needs to be completely removed from the company. That is the only way to prevent this menace from doing more damage.

    • 0 avatar
      SCE to AUX

      I do agree that he should be removed due to his instability.

      • 0 avatar
        Luke42

        Removing him from the board was appropriate.

        Musk has really pushed the industry forward by sheer force of personality (and an embrace of businrss-risk.

        However, guys like that need adult supervision — which is where the Tesla board comes in. Musk is no longer his own boss (the board can and should tell him what to do), but he can continue to create value by pushing the company and the industry forward.

        This seems like the best possible outcome to me.

  • avatar
    Stumpaster

    If Musk leaves Tesla will be adding radiator grilles on all cars. Because that’s what everyone else is doing.

  • avatar
    PrincipalDan

    In our next episode of “INTERVENTION” on A&E…

  • avatar
    JimZ

    “but he is soon to join the SEC in front of a federal judge”

    so-called “judge”

    – @elonmusk

  • avatar
    APaGttH

    Greatest CEO in modern history. 100 years from now he’ll be venerated more than Edison. Everything is great. Nothing is wrong. If he wants to cry, smoke pot, make strange accusations of pedophilia, mock investigators, shareholders, and force good people out of the companies he runs that is his prerogative.

    Anyone else building electric cars and making 30% profit on each one they sell? Huh? HUH?!? This place is just a lovefest for GM products, look at the Super Cruise story as proof of this.

    I can only hope to one day be worthy to clean Elon Musk’s coffee cup using my tongue.

    • 0 avatar
      civicjohn

      @APaGttH,

      “Anyone else building electric cars and making 30% profit on each one they sell?”

      Care to back that up with any factual information? Financials, etc.?

      • 0 avatar
        APaGttH

        Your sarcasm detector is clearly broken. The Tesla fanbois are making this claim (well started at 25%, then went up to 30%) but when you ask for a fully reliable source, like say, from Tesla itself – they go dark.

        Apparently someone did a breakdown of the material costs to build a Model 3, and came up with at asking price they make 30% margin. Ahhh, but that is gross margin, not counting the actual costs of assembly, paint, etc, etc. etc. Also, because Tesla sells directly and not at “wholesale,” SG&A is going to be higher than a traditional OEM.

        So the 30% is BS when you look at the real finances.

        • 0 avatar
          civicjohn

          @APaGttH,

          My bad, yes I need to get my sarcasm detector fixed. I blew past your last sentence about cleaning EM’s coffee cup!

          I do remember the tear-down report that was the basis of a 30% margin on the Model 3. And I believe that was one of the $50-60k versions, because even Sir Elon has said the $35k model would not be profitable for Tesla at this time. The teardown was done by Munro and Associates.

          • 0 avatar
            Pch101

            Munro is in the business of selling reports.

            Anyone who is familiar with the tech industry knows that is typical for third parties to make all kinds of fantastic ROI projections and that most of those projections are pure BS.

            The Autoline interview with Munro that Tesla fans like to tout was a joke. Tesla’s tendency to simplify assembly by consolidating circuit boards is going to make replacing them more expensive, so that is nothing to brag about. Likewise, no one should be surprised that batteries are improving; anyone who owns a laptop should already know this.

            Tesla can’t hurdle its overhead costs, and those costs aren’t declining.

  • avatar
    James2

    I wonder what his last tweet will be when the judge decides the ‘sentence’ is too light and figures a good 2-3 months in a federal jail is more appropriate, along with a doubling (at minimum) of the fine.

  • avatar
    Luke42

    I’ve always considered Musk to be a sort of modern Howard Hughes.

    Alas, he seems to be going to crazy town the same way Hughes did. As you may know, Hughes was a brilliant engineering-business leader who turned into a hermit and a germaphobe, who spent his last years cooped up in a penthouse in Vegas. I hope Musk escapes a similar fate, or are least reaches full-crazy in a penthouse on Mars.

    But I still want a Tesla, and Tesla is changing the car industry for the better. So there’s that!

    • 0 avatar
      SCE to AUX

      Show me the blueprints.

    • 0 avatar
      raph

      More like the Paris Climate Accords are changing the auto industry for the better. Musk was just a little ahead of the curve by backing Tesla’s founders it appears.

      I briefly thought Musk showed the industry that EVs were viable but it looks like Tesla is about to blow up in his face so on that count It doesn’t seem he’sparticularly notable.

      • 0 avatar
        Asdf

        Donald Trump was ahead of the curve by showing the world what to do with the Paris Climate Accords. All we need to do now is to wait for other civilized countries to follow suit.

        • 0 avatar
          Luke42

          Musk is looking pretty crazy, but a Tesla is still the only expensive car I aspire to own.

          Without a futuristic all-electric brand, the car industry is leaving money on the table. My money specifically, and also money from all of the other Tesla fanboys.

          I can list the reasons why, I would prefer a Tesla over a gas car, but my list isnoretty standard and we’ve beat that one to death. The point here is that there are people (like me) who are willing to pay about twice what a regular car costs for a Tesla, because the regular car industry has not been catering to us. That’s money left on the table.

          @Asdf: The Paris clinate accord isn’t going away. It is an agreed upon framework for mitigating a serious problem, created to address the needs and concerns of all of the participating nations (including especially the US). Most nations prize thoughtful policy over swagger, and won’t destroy their international dealnaking reputation by failing to honor an agreement they made in good faith.

    • 0 avatar
      HotPotato

      The electric car is the way of the future. The way of the future. The way of the future.

  • avatar
    Asdf

    Maybe it’s dawned on Elon Musk that he is incompetent and unable to build a viable BEV that is competitive with ICE-powered cars by now, and that this realization has put him on a self-destructive path. It is reasonable to assume that after a whopping FIFTEEN YEARS in business, Tesla would have managed to take care of such basics as making a BEV that could be charged in the same time as it takes to fill a gas tank, but no, incredibly enough that hasn’t happened, and if that’s not bad enough, there’s no indication it’s gonna happen any time soon!

    The very type of vehicle that Tesla is specializing in has thus proven to be an evolutionary dead-end, with Musk finding himself in the unenviable position of being the CEO of a company making the automotive equivalent of MiniDisc players, and with no way out. The Musk sycophants at TTAC probably don’t realize that yet, but Musk himself probably has. No wonder he’s going crazy.

    • 0 avatar
      JimZ

      do you have this rant pre-written so you can just copy & paste it?

    • 0 avatar
      SCE to AUX

      “unable to build a viable BEV that is competitive with ICE-powered cars”

      The dozens of car models outsold by the Model 3 last month would disagree. Especially the Corolla, which generated only 1/3 the revenue for Toyota that the Model 3 did for Tesla.

      @JimZ: Of course it’s copy-paste from Asdf – and EBFlex, too. Their style of crazy is funny at this point.

      • 0 avatar
        civicjohn

        @SCE, so they are going to get to 10k units per year, and ultimately drop the $35k Model 3.

        I’d like to know where in the hell they will sell 500k units per month at $50k+. An “affordable” EV is off the table for the time being. I hear how they are slaying BMW 5 series, MB, whatever.

        There is only so much room for a vehicle priced at what they currently build.

      • 0 avatar
        civicjohn

        my son is in from college, we drove past the Tesla parking area after lunch, 2X the cars from 2 weeks ago, not all Model 3, many X and S, 2 more haulers unloading, but space at the dealer.

        I guess this is a part of the “cars in transit” math we’ll see on the Q3 financials. “Delivery hell”.

    • 0 avatar
      Lockstops

      “Maybe it’s dawned on Elon Musk that he is incompetent and unable to build a viable BEV that is competitive with ICE-powered cars by now, and that this realization has put him on a self-destructive path.”

      That part I agree with, and have thought the same. I think he might be looking for a different kind of out for himself than the humiliation of ‘ordinary’ bankruptcy which he couldn’t blame on others.

      • 0 avatar
        mcs

        Actually, Tesla’s are not only viable, but they’re also superior to ICE cars. I see plenty of them on the roads. The reviews are good. Besides, if you can afford it, why bother with a slow-assed POS ICE car.

        • 0 avatar
          raph

          Superior to ICE cars? So your indicating that in every conceivable metric Tesla (you say Tesla specifically but I suppose your indicating all BEVs) is superior to every ICE powered vehicle out there.

          Yeah… I suppose some elaboration on your part is in order since a simple “yes” won’t be very convincing.

        • 0 avatar
          Asdf

          No, Teslas are not superior to ICE cars. Teslas are defective by design, because that incompetent fool running the company failed to fix the problem of charging the vehicle taking forever, BEFORE he launched them on the market!

          • 0 avatar
            Luke42

            @Asdf: It’s clear you’ve never actually driven an EV.

            Yes, there’s a trade-off in charging — but your car typically charges at home while you sleep. People who don’t have electric service at their homes *should* drive gas cars.

            And, yes, the electric grid is an EV’s tailpipe.

            And, yes, Musk seems to have a one-way ticket to Howard Hughes-style crazytown.

            Us EV fans know all of that.

            Now, back to the car:
            EVs have *fantastic* NVH. Even the lowly Nissan Leaf feels like a luxury car, due to the lack of vibrations under the hood.

            EVs also have fantastic low-end torque, without any of the huffing and puffing and shifting that a conventional car does.

            Not only that, just most of the messy and boring maintenance tasks on conventional cars just don’t exist on EVs. Even brakes last longer, due to regenerative braking. (The last car I had with regenerative breaking was a small hybrid, and the brake pads lasted 160k miles with a lot of in-town driving.)

            Lastly, if you have a commute which fits into your EVs battery range (and you shouldn’t buy one if you don’t), you start every day with a full battery.

            All of this adds up to a really deairable driving and ownership experience. The environmental benefits and the technology benefits are very real as well

            An EV may or may not be a perfect fit for you personally, but you should go drive one so that you can be taken seriously on this topic.

          • 0 avatar
            JimZ

            “EVs have *fantastic* NVH. Even the lowly Nissan Leaf feels like a luxury car, due to the lack of vibrations under the hood.”

            the down side is that since they don’t rely on the service brakes as much, it doesn’t take long before you hear the scraping sound of the coating of rust on the rotors’ surfaces.

          • 0 avatar
            mcs

            @jimz: “it doesn’t take long before you hear the scraping sound of the coating of rust on the rotors’ surfaces.”

            That hasn’t been my experience. The stop at the end of the driveway seems to clean them. The regen is dialed down quite a bit on my car when it has 100% charge, so they get a bit of exercise at the start of a trip.

          • 0 avatar
            Asdf

            “Yes, there’s a trade-off in charging — but your car typically charges at home while you sleep.”

            Sometimes I wonder if EV ownership makes people retarded, because for some moronic reason, the argument you just made keeps popping up as if it were somehow relevant. However, charging an EV at home while you sleep does ABSOLUTELY NOTHING to decrease charging time, and the inherent defect that Elon Musk hasn’t been bothered to fix STILL EXISTS and still has to be addressed for EVs to be viable. It’s a completely disgusting expectation that EV ownership should have to involve people mitigating the vehicles’ inherent and unaddressed defects by accepting hours of weekly mandatory downtime for their vehicles to be usable.

          • 0 avatar
            mcs

            If you’re not constantly driving your vehicle 24 hrs a day, it’s not an issue. My EV hasn’t been driven for over 24 hrs now and was fully charged as of 21 hrs ago.

            If you want to talk about inherent flaws, the fact that you can’t fuel a gasser easily at home is a flaw. The fact that you have to change the oil in a gasser is a flaw.

            It’s really nice not having to deal with a gas station.

            Another working prototype solid-state battery has been demonstrated and it’s expected to go into production next year. I know of others starting pilot production. Soon EVs will be cheaper than gassers and will start gaining in market share.

            Get ready because gas stations will start to disappear as EVs gain market share. Even though it only takes 5 minutes to fuel a gasser, it may take you 30 minutes to find a station.

          • 0 avatar
            JimZ

            “However, charging an EV at home while you sleep does ABSOLUTELY NOTHING to decrease charging time, ”

            If I wake up to a “full tank” every morning, why should I give a toot how long it took to “fill?”

  • avatar
    road_pizza

    This dude’s cockoo for Cocoa Puffs. Seriously.

  • avatar
    conundrum

    A sort of visionary at some things, a wittle boy worse than Sheldon when it comes to street smarts. Hires senior staff who find him an interferer not leader and leave. Has above average ability to erect a tent but not pay for it. Likes to accuse people of pedophilia who don’t swoon at his invention of a rigid submarine for cave waterway rescue based on a brainstorm and no data. Finds regulators limiting his ego outbursts and illegal behaviour both puzzling and annoying. Cannot withstand the faintest whiff of criticism.

    Summary, somewhat schmarter than yer average bear raiding recycling bins outside the gun club commissary, due to verifiable language skills. Can hypnotize sheeple followers into believing in the tooth fairy and handing over cash. Requires some real REM sleep and a vacation on the Andaman Isles, where he can tackle sealevel rise betweem breakfast and lunch with the aid of a Tesla Superpower Battery and Solar Panel Deluxe Extension Kit for Beginners.

    Overall score 2 stars out of 5. Needs improvement. But just a great lovable guy at heart, trying to save the world the only way he knows how.

    • 0 avatar
      Lockstops

      Very well (and entertainingly) summed up. As for the ‘a sort of visionary’, I doubt even that part: he just saw a company two other guys had started and thought that maybe electric cars could be a thing. Then he used methods you mention to force that ‘thing’ into existence for a few years. Taking a car and making it electric isn’t anywhere near a revolutionary, original, or any other kind of visionary idea. It’s common knowledge as a concept and it’s really simple. The only ‘visionary’ part has been his BS visions/predictions of it becoming profitable as a business case from the time of founding (or his entry into the company) to when they got into production, and them being able to finance it. The latter part he did guess right, the first part he guessed wrong.

      It’s not like multi-billion budget car manufacturers haven’t had hundreds of very intelligent engineers specifically having the task of keeping tabs on all different types of tech from ICE hydrogen engines to compressed air! And not just theoretically, but by prototyping and testing a lot (well, only a few companies have put much effort on compressed air…)!

      But now supposedly all of those people with detailed in-house information on cost structures and excellent cost-benefit-analysis tools (of which the calculations and estimates themselves are very complex and hard to make even with inside information and tools plus consulting!) were completely wrong and only Elon Musk, an industry outsider without basically any of that inside info & experience was right?? No, the established manufacturers kept tabs on the tech and kept prototyping and testing, even testing with consumers (prototype lease programs) and have kept out of bringing them to market until they felt they made a business case, or at least were fit to work as a sideshow for the marketing department that didn’t cost the company too much. Musk just forced it with cheerleader money. For as long as he could force it.

  • avatar
    Mike-NB2

    Musk is either proving the theory that there is a fine line between genius and insanity. That, or he’s just smoking too much high-test weed. Or he’s truly just gone off the deep end into insanity.

  • avatar
    HotPotato

    I’ll make you a deal : we take away Twitter from Musk and Trump at the same time. I guarantee, the haze of megalomania will begin to clear from the air.

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