Nothing says that every billionaire is a policy failure like this Twitter engagement chart:
The bigger the bubble, the more “engagement” the account gets. That’s from Nate Silver, so you’ve been warned, but I have no reason to doubt it. Most of the little blue bubble accounts are also on Bluesky, so if you’re interested in reading stuff other than MAGA nonsense, there’s not a huge justification to stay on Twitter. Since most big name journalists are still on Twitter, their brains are going to be even more severely rotted because the algorithm serves up right-wing noise. Twitter also downgrades posts that have external links, so newspapers posting their stories on the platform get dinged. Musk wants to keep everyone in his walled garden where he’s king of the shitposters. Well, he paid for it, lost a ton of money on it, and he got what he wanted. The rest of us, not so much.
Speaking of other pictures that show policy failure, Tesla is still around $400 per share, even though it’s clear that Musk has lost interest and is focusing his attention on the impending SpaceX IPO. If buying a stock is buying a bet on the future, Tesla should be at most a double-digit stock. Their future is nonsense like second-rate AI, robots that will never arrive, robotaxis that are way over-hyped, and the Cybertruck. If we ever let Chinese EVs like BYD into this country, only the most brand-loyal Tesla fanbois would buy old tech from this company.
Nevertheless, Musk persists, and his SpaceX IPO is, like everything else he’s shilling, way overvalued. Morningstar says that the stock is priced at double what it should be worth.
SpaceX is not currently profitable. While its Starlink business, which makes up the majority of its revenue, increased 50% year-over-year, the company still recorded a net loss of $4.95 billion last year partly due to heavy AI-related expenditures. Based on its giant valuation alone, SpaceX would be the seventh-biggest company in the U.S., the Financial Times reported. Yet, by revenue, it would be the 200th biggest. Analysts have warned the company’s valuation is being derived from the future expectations of its ambitious projects like orbital data centers and Musk’s reputation for building innovative companies like Tesla.
Several factors will inflate the stock price after its scheduled June 12 IPO date, including outsized interest from investment banks who are underwriting it, as well as a small float resulting from the company’s decision to offer only 3% of its shares to public investors, and finally due to a rule change that will allow SpaceX to quickly join the Nasdaq 100 and force index funds to buy its shares automatically.
The one bright spot is that S&P has said that it will stick to the rules of its index and not let SpaceX onto the S&P500 until a “seasoning period” has elapsed. Also, companies on the S&P500 need to be profitable. Tesla is on the S&P500, and it is “profitable” — it engages in financial engineering to make sure that it never has an unprofitable quarter. Also, SpaceX has a lot of AI data centers, but it’s leasing a bunch of their AI capability to Google for almost a billion dollars a month. Again, Musk AI is hype.
At some point the Musk house of cards will fall, but not while Trump is in office, which was his goal in helping to get Trump elected.
