tesla CEO Musk.
Elon Musk, the CEO of Tesla, announced on his personal Twitter account on the 2nd that he would be “leaving Twitter for a while”, leaving nearly 45 million followers with the question mark of suspicion. As far as CEOs of large corporations are concerned, Musk is quite active on Twitter, so why did he suddenly announce his departure?
Barron’s reports that Musk has been tweeting a lot about the online forum Reddit, retail investors buying U.S. game stocks GameStop, short-selling big players, and crypto coins. After GameStop set off the Wall Street frenzy, Musk suddenly announced a break from Twitter, whether there is a direct connection between the two, causing people to wonder. Tesla was not immediately available for comment.
According to Bloomberg columnist Lionel Laurent, Musk’s suspension of Twitter activity shows that he “seems to have become more uneasy” about tweeting about stocks, cryptocurrencies and other asset markets. According to Laurent, “as regulatory authorities begin to investigate possible market manipulation and warn that some unfortunate pawnbrokers could fall hard to the ground, they will no doubt make their own conclusions.
The Wall Street Journal notes that Musk’s unconventional use of social media is appreciated by his fans, but “his tweets sometimes stray into legal gray areas.” Musk’s tweets raised concerns with the SEC in 2018, when he tweeted that he had secured the financing needed to get Tesla off the market. He later left Twitter briefly, only to return to tweeting after a settlement with the SEC that included a fine, stepping down as chairman of Tesla, and increased self-restraint in his statements. He has also taken a break from the Twitter platform in 2019 and 2020, but only for a few days.
Musk boasted in February 2019 tweets that Tesla would ship 500,000 vehicles that year. In fact, Tesla’s full-year 2019 production actually grew by 50 percent to about 370,000 vehicles, and will take another year or so to reach the 500,000-unit mark. 2020 is affected by the New Crown Pneumonia (CCP virus) outbreak, and Tesla’s deliveries will be slightly less than 500,000 vehicles.
Musk’s recent tweets have once again raised eyebrows. A week ago he tweeted, “Gamestonk!” (“stonk” is a play on the Internet term for “stock,” often used in giddy descriptions of sharp rises or plunges in stock prices. Musk was apparently referring to the GameStop stock spike.
GameStop shares, which soared 400 percent last week to close at $325 per share at the end of January, closed the second day with a 60 percent drop to $90.
Musk also tweeted a picture of a replica of the cover of Vogue magazine, only it was a dog on the cover and the caption read “Dogue”. Doge,” he tweeted in December last year, “is one word: Doge. The Doge coin market has skyrocketed from less than 1 cent in December to over 3 cents.
The GameStop-related short-rolling market appears to have ebbed, and Doge has slipped from a peak of about 5 cents to 3 cents in recent days. Silver, another Reddit forum topic asset, also retreated in price on the 2nd.
As Lorente pointed out in his Bloomberg column, Musk’s announcement of a temporary retreat after a week of using the “tweet” button to sway the market coincided with the ebbing of the social media-driven mini-surge in stocks, metals and crypto coins, showing that there are limits to the power of such community-fueled market rallies, as these speculative activities involve “massive self-interest,” no matter how large the following crowd is. The instigators who initially encouraged the crowd to buy may have already taken their profits and left their pockets.
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