Musk: From Asset to Liability?
Remember the days when Musk was a household name? Well, it might be time to cast doubt on them.
GN Crypto has extensively reported on the many twists and turns of the Musk-saga that took place this year.
But here’s the nitty-gritty of it: His actions aren’t just contentious.They also may end up hurting the shareholders and society at large.
Let’s start with the X (Twitter) story. There’s a high chance that you’ve heard of the many scandals that took place on it, often involving Musk personally. Though he delegated his position of the CEO to Linda Yaccarino, it appears that he remains the place’s ultimate decision-maker.
One of the biggest scandals took place when he endorsed an antisemitic conspiracy theory, according to which the Jews want to eliminate the white population. His decision to tell the advertisers, Disney included, to “go fuck themselves” and reinstating the conspiracy theorist Alex Jones after carrying out a poll that doesn’t have any measures to stop bots and fake accounts from participating in it have proved to be no less scandalous.
While this foremost has a huge impact on the spread of false information, it also has very tangible financial ramifications. According to fresh predictions, X will now generate much less income than before Musk – who also acknowledged that the drop in ad revenue could cause X to fail.
Yet, the real deal is Tesla, the seventh-largest company by weight in the S&P 500 with a market value of over $800 billion. Because of its size, the company is part of multiple indexes and ETFs, which makes many people dependent on its performance.
This is where Musk’s behavior on Twitter once again plays a big role. When he agreed with the statement that the Jewish communities push “hatred against Whites”, it immediately affected Tesla’s shares. President of First American Trust Jerry Braakman insisted that Tesla’s board directly tell Musk that this is a step too far as a result.
Musk’s decision to travel to Israel to improve the situation had a limited positive effect. On top of this, according to fresh reports by Bloomberg, his ambitious company Hyperloop One has just gone bankrupt, casting further doubt on the financial future of his empire and its investors.
Doing a bit better than SBF
Financial aspect isn’t the only one impacting the whole situation. It’s also about the image and reputation of the company.
A recent Axios Harris Poll on the 100 most visible brands produced some dramatic results for Tesla: its reputation dropped from 11th place in 2022 to 62nd place in 2023.
The only company that did worse than that was FTX – and it’s not the kind of company you want to be particularly associated with these days. Especially after SBF was found guilty on all charges and is now facing prison-time.
Musk may not be facing prison-time – but he’s also increasingly subject to scrutiny by authorities. This includes the recent launch of a probe by EU authorities as well as people who took him to court for alleged Dogecoin price manipulations. His long-time attorney Alex Shapiro is currently taking care of it.
Previously, GN crypto begged the question of whether Grok Turns Against Musk?
