Comment by JumpCrisscross
2 days ago
> they're banking on Musk generating government pressure (corruption) to MAKE business be better
The thesis banks on patronage. Musk de facto controls a $7tn money spigot [1]. Losing billions investing in X is a win if he even sputters your way.
This is the reason power concentration corrupts economies--Musk's proximity suppresses market signals in favour of political ones. Elon's ironically recapitulating the South African economic disaster.
[1] https://fiscaldata.treasury.gov/americas-finance-guide/gover...
> I wrote the other day that “the way finance works now is that things are valuable not based on their cash flows but on their proximity to Elon Musk,” and I am already tired of it. It was a joke? But in a couple of years there are going to be 800-page textbooks on Elon Musk Proximity Pricing; it will be a whole unit on Level 1 of the CFA. You might think that “did Elon Musk tweet about a thing” would be a simpler valuation metric than, like, “estimate its cash flows in perpetuity and apply an appropriate discount rate,” but I don’t know, there’s a lot going on.
Money Stuff: The Elon Markets Hypothesis - https://www.bloomberg.com/news/newsletters/2021-02-10/elon-m... | https://archive.today/cZo0E - February 10th, 2021