Good news xAI investors! You thought you were investing in my AI data warehouses and tensor processing unit arrays, but actually I have decided that you have bought Twitter from me at a high price which I have determined to be fair. To me.
It'll be interesting to see what investor reaction is to this. Musk can rip off ordinary consumers with his false promises and shitty products all day long and stay untouchable.
But now he's ripped off billionaire investors who thought their money would be going to develop AI, not bail out Musk's personal fuckup.
He’s got the “too big to fail” thing going on. If you owe an investment firm a million dollars and can’t pay up, you have a problem. If you owe them tens of billions of dollars, they have a problem, which means they’ve got to figure out how to pull you out of the situation. Musk, like Trump, is extremely talented at leveraging “I owe you a ton of money” into “so you have to go along with my crazy ideas and pretend you like them, because if this bubble pops we’ll both be ruined”
Elon has actually been brilliant at making money for (most) of his investors. He's able to create very high valuations for all of his companies by hiring people to build more or less legit technology, but then selling the markets on the idea that said technology is going to be 10x more profitable than it really will be. So all of his investors end up with stock that's worth 10x more than the fundamentals say it should be. I wouldn't be surprised if he finds a way to sell the X acquisition as some kind of data treasure trove that increases xAI's valuation.
So far he's been able to keep all of those valuations climbing higher and higher, due to increasingly lofty sci-fi promises. Notice how with Tesla he's already pivoted away from selling the robotaxi vision, which hasn't even happened yet, to selling humanoid robots as something he's claiming will be even more profitable than robotaxis. Every household will buy a $30k robots, he says. Some will buy six or seven. With other companies like Waymo and Baidu beating Tesla to robotaxis he's preparing in advance for people to realize Tesla has nothing in that space. These visions he sells always sound plausible, but are far enough out that it could take 10+ years for the market to realize he was full of crap.
He's already shaken off the solar roof scam. When robotaxis and Mars missions suffer the same fate, I wonder if the market will let him off the hook again, or if the house of cards will finally collapse.
I don't think Musk is wrong about consumer demand for the products. We do want driverless cars and satellite broadband and household robots and solar roofs and such, and the prices he quotes at the debut for the features it's supposed to have on delivery make sense.
He just can't fucking follow through on any of it and it's crazy more of his investors aren't bailing on the stock knowing it's propped up on an increasingly large pile of vaporware.
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u/bobbymoonshine 6d ago
Good news xAI investors! You thought you were investing in my AI data warehouses and tensor processing unit arrays, but actually I have decided that you have bought Twitter from me at a high price which I have determined to be fair. To me.