Just How Indebted Is Elon Musk?

Tesla continues to head south since hitting its post-earnings high of $321. It’s down nearly $100 from the $380 post “funding secured” tweet all-time high close on August 7th. The stock has diverged negatively from the SPX since mid-January. By all accounts the order-rate and delivery rate of Tesla’s 3 models is dropping quickly. While there may be a brief boost in sales from  Model 3 deliveries into Europe and China in Q1, it looks like Model 3 orders and deliveries in North America have slowed to a trickle. Complaints about the poor quality of the Model and poor service from Tesla are already populating European automobile forums.

There have been wide-spread reports from people who are having trouble getting canceled $1,000 reservation deposits on Model 3’s refunded. Several have reported receiving the refund only to have the check bounce after it’s deposited. Consumer Reports removed its highly sought recommendation rating from the Model 3 after citing poor quality control and reliabity. This past Wednesday Tesla’s General Counsel, who left his Washington, DC law practice and took the job two months ago, announced he was leaving the Company. The stream of high-level c-suite departures has been nearly continuous over the last year.

Tesla is staring at the $920 million convertible bond maturity due next Friday (March 1st). I have no idea how Tesla will address this, as it seems by many indicators that the $3.9 billion in cash Tesla posted on its year-end balance sheet may not be accurate, in addition to showing negative working capital of $1.7 billion. That said, I would not bet that Tesla will default this soon on its debt.

On Friday it was reported that Elon Musk took out $61 million in mortgages on his five California mansions, $50 million of which was new funding and $11 million was refinancing (note:  rumor of this deal was in the market a week earlier). Morgan Stanley underwrote the mortgages. I would suggest that Musk possibly needed the money to meet margin calls on his stock-holdings, against which Musk has borrowed heavily. Otherwise it makes no sense to me why an alleged billionaire would need to trifle with $61 million in mortgages. Morgan Stanley is one of Musk’s primary stock custodians. In that regard, I’m wondering if Morgan Stanley forced the issue.  It’s a good bet that Musk has pledged and hypothecated most of his assets as collateral against indebtedness. I have no doubt that when Tesla hits the wall, Musk’s wealth will largely vanish.

4 thoughts on “Just How Indebted Is Elon Musk?

  1. How much debt has Tesla?
    There is a number and Elon knows it.
    Probably about the same amount as some bastardized version of a Rumangen number over a Fibbonaci divided by the cube root of Pi
    What does Tesla share with Enron and GE? All three are electrically powered Ponzi schemes run by 170 IQ propeller heads with delusions of grandeur.

  2. Elon Musk knows what DEBT AS MONEY is…. He knows that the bankers issue it from nothing… that it is LOANED into existence.

    Elon Musk pioneered (as a founder of PayPal!) the connection between negotiable DEBT instruments and email addresses. Being IN DEBT is an ASSET according to the “rules of accounting”… because “DEBT IS MONEY.” debt as money makes accounting entirely backwards…. normal assets are legal liabilities, and normal liabilities are legal assets.

    To the “public” everything is straightforward… to the bankers, attorneys, government, Elon… banking/money is backwards… and the Bankers designed it this way in 1913… even before the Federal Reserve, the backwards “debt as money” system was being applied and used against governments and the people.

    A few people get that “in-Debt is Money-wealth”. Those who are not rich and connected do not have access to the system of loaning money into existence… at least not without needing to pay the principal back, plus interest (extortion)…. when it is all new money and there is no principal…. all the principal is new money loaned into existence that didn’t even exist BEFORE the loan.

    It is wise to note here that “reserve requirement” rules only apply to the first few million that a bank loans… which occurs in the first few hours/days of each quarter of normal business operation. After, banks loan money into existence without any reserves…. selling the note upstream to the Federal Reserve. Who probably, at this point, sells it to the BIS/IMF/UN for the Feds lack of funds and international risk distribution.

    For example, if Donald Trump needs $47 Million to help fund his campaign… he can, and did, loan himself the money from nothing… merely on the assumption that It COULD be paid back. After he won the election, the $47 million dollar loan that trump made to himself was cancelled so he didn’t have to pay himself back. This is a trick that rich people have access to through the banks…. I know. I was “offered” the opportunity to do this a few times before JPM PRIVATE BANK forcefully terminated my account for attempting to exercise real freedom of debt-speech, calling them out on their debt-monetization facilities. For more info about Trump, see this: https://www.youtube.com/watch?v=DjV3LKvWuVE

    Elon has an inside track with the bankers. It is the bankers that control whether or not Elon/Tesla can/will go bankrupt or stay in the black.

    One of the reasons why Elon went from PayPal to Tesla is because “UNDERWRITING VEHICLES” is a FAR FAR FAR more profitable business than underwriting email accounts with new debt-money.

    Every part of the VEHICLE business is very likely financialized, in both TESLA and SPACEX. This means that every purchase is made with new debt-money… every sale is re-underwritten… every financial loan is re-hypothecated many times over.

    In all, a Tesla vehicle is likely RE-HYPOTHECATED about 10-30 times even before it gets out the door. That is basically ALL pure profit for Tesla. All the rehypothecations DO NOT show up on the financial statements of businesses for a variety of reasons.

    All business that operate through extreme re-hypothecation (TESLA, SPACEX, JPM, GS, telecoms, energy companies, etc) are creating basically what amounts to a second set of books, private books. Keeping second sets of books is authorized under US NATIONAL SECURITY. all “classified project” profits are literally to be keep off the public ledger. rehypothecating every receipt appears to be considered a “classified” financial military weapon against foreign countries.

    This is leading to ALL kinds of corporate fraud under the guise of “national security.”

    Basically, being honest and truthful is considered a US NATIONAL SECURITY RISK at this point in time because they have spun so many lies. merely pointing out the hypocrisy is considered, by many in the government, to be ILLEGAL and a CRIMINAL ENTERPRISE… hence the crack down on real news as FAKE… then the promotion of FAKE MSM news as Real. Exposing the crimes of government officials appears to be a grave offense… even though no one holds them accountable… and they hold the journalist/reporter/citizen accountable for….. pointing out the corruption of government.

    The entire US Government is a DE FACTO corporation (Title 28 USC §3002(15))… de facto is legally ILLEGITIMATE. Nothing is going to get better until Americans start treating the illegitimate US Government as if it were… illegitimate.

    And that IS happening! Yellow Vest, Occupy, riots, people living in poverty continues to rise, food stamp programs dysfunctional, and yet people still believe that VOTING matters?

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