It’s a rare thing to watch a company blast from obscurity to mega fame/fortune then to failure, at least it used to be. Tesla and Elon Musk are proving it to be too common. We are used to the flash-in-the-pan failures like Robinhood. Anyone old enough to have lived through the DOT-BOM flameout knows all too well the number of companies that can flood the market during a gold rush then go bust.
Stupid money chases a trend created by a fad.
There is a multi-part documentary PBS stations aired well before the election about Donald Trump. His history from childhood through his first major criminal fraud pitching a real-estate deal claiming to represent someone he’d never spoken to so he could “steal a deal.” One should really watch it. The documentary goes into great detail about the branch of Deutsche Bank that was funded by Russian Oligarchs and how it always funded Trump, no matter how many bankruptcies. Putin bought Trump early on. Russian’s play the very long game. I’ve spoken about that before on this blog.
I bring that up now because I never paid attention to Elon Musk’s early funding sources. His recent purchase of Twitter and dismay that Trump is still banned raise a massive red flag. One might have been able to somehow spin his refusal to block Russian Propaganda (they, like Fox, call themselves “news sites” but they, like Fox, are only Russian propaganda sites) as “I’m only the transport media” . . . maybe. Not after his latest comment though. At first I thought he was just racist like Tucker Carlson. Now I have to wonder just how long ago Putin bought Elon Musk?
The Smart Money
The smart money appears to be dumping all things Elon Musk. This isn’t a personal attack, this is just someone who is old and seen this movie before.
During my youth I worked for Jack Goeken.
Jack was a great guy. He was a great guy who started out as a television repair man. Jack created MCI, FTD, and Airfone, Inc. He was the kind of guy who would be walking the halls of the company after 10pm when I started my shift as a midnight computer operator and ask “How’s it going?” Don’t get me wrong, we’ve all uttered this phrase in passing. Jack stopped and waited for an answer. He was that guy.
Personally I believed Jack could build anything. He just couldn’t run it. That’s not a slam, they are two different skill sets. There is a tipping point at which a creator has to step aside to let stable management in. If they don’t they go bankrupt and get purchased for a song. Many then go on to be profitable.
Elon Musk is one of those guys. More than enough ego to build something and too much ego to either run it or step aside. We are well past “indiscresions of youth.”
He’s had the rise, and the fall has already started. There’s no recovering from this. If he isn’t ousted from all his companies, they go under.
The smart money is leaving.