In a January email to staff, Musk pointed to the company’s growing influence and power, but said the finances remain problematic.
“Our user growth is stagnant, revenue is unimpressive, and we’re barely breaking even,” he said in the email, which was reviewed by The Wall Street Journal.
Geee I wonder what could have caused this?
This certainly hasn’t helped.
Why do I keep seeing this particular comparison? It’s the least obvious part of the whole thing. The rest was clearly a Nazi salute. Without that context you may think he’s clutching his chest because he’s having a heart attack or something.
Edit: nevermind I’m just dumb. I guess gifs don’t auto load on my Lemmy client anymore. I swear they used to.
Voyager is my favorite
Mlem is vastly better.
Yeah great, but it’s apple only.
it was bought by musk at the behest of saudi royals who never again wanted to be raked over the coals globally for doing something like butchering kashoggi, the blowback cost them face which they were not prepared for spending billions on things like soccer leagues and stadium to curry favor with the west, and elon wanted saudi markets open for his rocket ships and electric cars, they invested, he invested, but mostly he took out loans from sucker banks which had made money from tesla and space x. i don’t think he intended to become the nazi poster child when he bought twitter, but water finds it’s own level, and this was always his.
See, I’ve always maintained that he bought Twitter with the specific intention of earning his spot as the Goebbels in the upcoming Reich. It was never about money, it’s always been a power play.
as an outsider knowing nothing about nothing, sounds like they’re trying to offload subprime mortgages to anyone who’ll bite
Pretty much spot on. They’re looking for bag holders to swindle.
Musk is currently in the limelight, sort of. They know they have a short window of opportunity to unload those non-performing assets while minimizing their losses. And the way Donny burns bridges with virtually everyone, that window is closing rapidly.
This could potentially be another title for this:
Wall Street Banks Now Looking for Right-Wing Plebs to Hold the Bag🧑💼🗣️ 🤗…💰💸😱😢🙃
Holy shit, this is going to be hilarious. Imagine the fuckbrains who’d buy this shit.
Banks will be lucky to sell for as much as 10 cents on the dollar, especially as all loans might be unsecured.
Banks should package in a shitcoin, that would pay itself out, since those investors are used to losses now 😜
Shell companies for a Russian front.
Wasn’t X not paying it bills? (Rent, employees, utilities)
Any econ majors able to give me their best tldr of what this means or will result in if anything? I can’t wrap my head around how money and debt works sry
I’m not an econ major but I’m going to give you my theory anyway.
We’ve been circling the drain on a major global recession for two years. We’ve been avoiding it through sheer denial.
Nobody ever mentions it, but tech stocks were the first to take a beating in 2008. The reason is that they’re actually kinda worthless and just a place where billionaires gamble the way trust fund kids do with cryptocurrency. There’s just not really that much collateral in digital property. Unlike land, it’s value can just disappear overnight if people decide it’s uncool.
When asset managers are about to be called on their bets and have to find money somewhere, the first thing they’ll do is sell tech shares to bail out other investments. Houses will always have some value even if you end up having to manage it yourself, whereas any social network risks going the way of MySpace.
Twitter being in trouble isn’t just a sign that twitter is in trouble, but that investors need that money for something safer, and if they’re looking for something safer that may mean sheer denial isn’t working anymore.
Exactly. What the banks are doing are selling “loans”. Musk has to pay those loans back quote/unquote someday. If the loan is good, you hold on to it as a bank because the interest makes you money. If the loan is bad, you sell it so that you can get some of your money back and make the collection of the loan someone else’s problem.
Banks will do this for a number of reasons:
- To manage their balance sheet. Every loan not paid in full is bad and you need to balance good (income/good loans/etc) and bad.
- Generate immediate liquidity. Banks need to have some hard cash on hand, sometimes they sell to do just that, have hard cash.
- Free up credit lines to lend to new borrowers. Banks only have so much resources, sometime you cut losses to get new gains.
- Diversify the risk pool. You want a nice balance between “loans that might default” and “loans likely to not default”.
Now for everyone else, what the parent to this comment is indicating is the second option in that list. Having to create some cold hard cash suddenly. Usually, there’s a cyclical nature to needing greenbacks by the fistful, but like everything that’s not always true. Something can “happen” and you have a sudden need to have cash in hand pronto. Good way to get that cash is to start selling low hanging fruit if you have it.
Something like the Twitter loan is a good pitch for low hanging fruit. Musk is terrible at paying the loan back, Twitter is likely to default one day, but Musk suddenly has direct access to some pretty corrupt as fuck ways to actually pay that loan back. From what I’ve read in the article, the sell price is something like 90 to 95 cents on the dollar. So not a huge discount, this ain’t a fire sale.
But banks might want to offload Musk from their sheets just in case that money is something someone might later investigate. Like that 95 cents on the dollar price is “We think Musk is good for it, but we likely don’t actually want his money.” So you can make that federal investigation in 2033 someone else’s problem, by selling the loan today. The big bank makes about 95% of the original amount back and when Musk goes to pay his loan in Russian Blood Rubles, it’ll be to a bank that get investigated that isn’t <<insert some large bank that would “NEVER” think to take conflicted money>>.
That’s one theory. But there could be something on the horizon. Something that isn’t right around the corner, but coming up in the distance that the banks want to have cash on hand for. Usually you see a much larger discount, like 60 cents on the dollar, for “holy shit, this stuff is toxic but we need to offload it discreetly before everyone else wises up.”
I don’t think point one and three apply to Musk’s particular set of loans. But who knows?! Only the bankers do.
I’m sorry for being a pedantic loser but you don’t need to use quote/unquote in text form—you can simply put quotes around the word. We use it in speech to convey that a word or phrase is quoted.
I.e. ”someday”
On the one hand, yes.
On the other hand, even if it is unnecessary effort, spelling it out can be a form of rhetorical emphasis distinct from simply putting it in quotes.
My theory is more based on vibes and multiple continuous layoffs from the majority companies over the last few years.
The only thing that we can be pretty much certain on is that the banks think twitter is overvalued and think other Investors see it as undervalued.
Hard to say right now. The article suggests that the banks are just trying to free up cash on their balance sheets. However, this could instead be an indication that they are looking for a “bigger fool” to take the losses. I personally think the bottom won’t fall out of Xitter until the tesla share price crashes. Elon bought some time with credulous fools with the ridiculous cybercab demo, but that can’t last forever. At that point I think the only question is whether SpaceX gets pulled down with all the rest of the musk ventures
If he has a falling out with Trump, he’s toast.
Trump is greedy it’ll take a lot for him to fall out with his main cash cow.
Taking a 10% haircutcut?
They must really really want that shit dumped the fuck off their books.
It’s now “toxic debt”. They need to find some reeeeeaaallly dumb fuckers to buy it up. Probably gonna offer it to Trump supporters.
UAE will buy it
Or Saudis?
Someone who wants to curry favor will sweep it up
