>>> THE MARKETS JUST OPENED AND
>>> THE MARKETS JUST OPENED AND ALL EYES ARE ON TESLA.
ALL EYES ARE ON TESLA. MOMENTS AGO THE BOARD OF
MOMENTS AGO THE BOARD OF DIRECTORS ANNOUNCED IT IS
DIRECTORS ANNOUNCED IT IS EVALUATING, EVALUATING TAKING
EVALUATING, EVALUATING TAKING THE COMPANY PRIVATE.
THE COMPANY PRIVATE. THIS COMES ONE DAY AFTER ELON
THIS COMES ONE DAY AFTER ELON MUSK, ONE OF THE WORLD’S MOST
MUSK, ONE OF THE WORLD’S MOST POWERFUL AND UNPREDICTABLE CEOs
POWERFUL AND UNPREDICTABLE CEOs SENT HIS VERY CRYPTIC TWEET.
SENT HIS VERY CRYPTIC TWEET. AM CONSIDERING TAKING TESLA
AM CONSIDERING TAKING TESLA PRIVATE.
PRIVATE. FUNDING SECURE.
FUNDING SECURE. THE TWEET WAS SENT 40 MINUTES
THE TWEET WAS SENT 40 MINUTES AFTER SAUDI ARABIA ACQUIRED A
AFTER SAUDI ARABIA ACQUIRED A STAKE IN TESLA.
STAKE IN TESLA. SHORTLY AFTER THE TWEET, THE
SHORTLY AFTER THE TWEET, THE MARKET HALTED TRADING THE STOCK
MARKET HALTED TRADING THE STOCK AND REOPENED ONLY AFTER MUSK
AND REOPENED ONLY AFTER MUSK SENT AN E-MAIL TO EMPLOYEES KIND
SENT AN E-MAIL TO EMPLOYEES KIND OF GIVING A LITTLE BIT OF A
OF GIVING A LITTLE BIT OF A CLARIFICATION.
CLARIFICATION. I WANT TO BRING IN THE CEO
I WANT TO BRING IN THE CEO WEALTH MANAGEMENT MY FRIEND
WEALTH MANAGEMENT MY FRIEND DOWNTOWN JOSH BROWN.
DOWNTOWN JOSH BROWN. >> YEAH.
>> YEAH. >> TO ME, THIS REEKS OF ELON
>> TO ME, THIS REEKS OF ELON MUSK BEING THE DONALD TRUMP OF
MUSK BEING THE DONALD TRUMP OF SILICON VALLEY.
SILICON VALLEY. DISTRACT AND CHANGE THE
DISTRACT AND CHANGE THE CONVERSATION.
CONVERSATION. HE DIDN’T LIKE WHAT WALL STREET
HE DIDN’T LIKE WHAT WALL STREET ANALYSTS WERE SAYING ABOUT THE
ANALYSTS WERE SAYING ABOUT THE COMPANY IN THE FIRST QUARTER SO
COMPANY IN THE FIRST QUARTER SO THEY SAID THEY SHOULDN’T GET TO
THEY SAID THEY SHOULDN’T GET TO TALK ABOUT IT, THEY SHOULDN’T
TALK ABOUT IT, THEY SHOULDN’T ASK QUESTIONS.
ASK QUESTIONS. HE HATES SHORT-SELLERS.
HE HATES SHORT-SELLERS. HIS OPPONENT, HIS CRITIC, HE
HIS OPPONENT, HIS CRITIC, HE OBSESSES OVER IT.
OBSESSES OVER IT. THAT’S ELON MUSK HERE.
THAT’S ELON MUSK HERE. TO SAY HE SECURED FUNDING WITH
TO SAY HE SECURED FUNDING WITH NO FILING, HOW IS THAT
NO FILING, HOW IS THAT MARKETING?
MARKETING? >> I WAS ON THE AIR WHEN THE
>> I WAS ON THE AIR WHEN THE NEWS BROKE ON "THE HALFTIME
NEWS BROKE ON "THE HALFTIME REPORT" THERE WERE FOUR OTHER
REPORT" THERE WERE FOUR OTHER TRADERS ON THE DESK AND IT WAS
TRADERS ON THE DESK AND IT WAS WAIT A MINUTE, CAN YOU ACTUALLY
WAIT A MINUTE, CAN YOU ACTUALLY DO THIS?
DO THIS? IF YOU’RE PURSUING STRATEGIC
IF YOU’RE PURSUING STRATEGIC ALTERNATIVES YOU WOULD ACTUALLY
ALTERNATIVES YOU WOULD ACTUALLY ISSUE A PRESS ALERT.
ISSUE A PRESS ALERT. ASK THEM TO HALT YOUR STOCK FOR
ASK THEM TO HALT YOUR STOCK FOR SPENDING.
SPENDING. SOMETHING LIKE WE MIGHT GO
SOMETHING LIKE WE MIGHT GO PRIVATE AT 420.
PRIVATE AT 420. IT’S SHOCKING BUT IT’S NOT OUT
IT’S SHOCKING BUT IT’S NOT OUT OF CHARACTER.
OF CHARACTER. >> IT’S NOT OUT OF CHARACTER FOR
>> IT’S NOT OUT OF CHARACTER FOR MUSK.
MUSK. >> RIGHT.
>> RIGHT. FROM THE FCC PERSPECTIVE, FROM
FROM THE FCC PERSPECTIVE, FROM SOCIAL MEDIA COULD THAT BE?
SOCIAL MEDIA COULD THAT BE? >> YOU ARE ACTUALLY ABLE TO WITH
>> YOU ARE ACTUALLY ABLE TO WITH SOCIAL MEDIA IF ALL RECEIVE IT
SOCIAL MEDIA IF ALL RECEIVE IT AT THE SAME TIME.
AT THE SAME TIME. THERE WAS AN ISSUE WITH NETFLIX
THERE WAS AN ISSUE WITH NETFLIX USING FACEBOOK PAGE, I THINK
USING FACEBOOK PAGE, I THINK THEY HAD CROSSED 1 BILLION
THEY HAD CROSSED 1 BILLION STREAMS OR SOMETHING LIKE THAT.
STREAMS OR SOMETHING LIKE THAT. IT WAS 2012.
IT WAS 2012. HE WAS EXCITED ABOUT IT, HE PUT
HE WAS EXCITED ABOUT IT, HE PUT THIS ON HIS PERSONAL FACEBOOK
THIS ON HIS PERSONAL FACEBOOK PAGE, AND THEY DIDN’T TAKE ANY
PAGE, AND THEY DIDN’T TAKE ANY ACTION, BUT I THINK THIS IS
ACTION, BUT I THINK THIS IS LIKE, I THINK IT FORCED THE
LIKE, I THINK IT FORCED THE RELATER ER
RELATER ER REGULATORS TO SAY, OKAY, THERE
REGULATORS TO SAY, OKAY, THERE ARE NEW CHANNELS OF MASS
ARE NEW CHANNELS OF MASS DISSEMINATION, AND OF COURSE,
DISSEMINATION, AND OF COURSE, THERE ARE RULES FOR THAT.
THERE ARE RULES FOR THAT. >> IT’S EASY TO SAY AT A BOARD
>> IT’S EASY TO SAY AT A BOARD MEETING ELON MUSK DID BRING THIS
MEETING ELON MUSK DID BRING THIS UP AS AN OPTION.
UP AS AN OPTION. I CAN BRING UP A LOT OF THINGS
I CAN BRING UP A LOT OF THINGS AS AN OPTION.
AS AN OPTION. BUT IS IT ALWAYS A RATIONAL CASE
BUT IS IT ALWAYS A RATIONAL CASE WHERE THERE WOULD BE A STRATEGIC
WHERE THERE WOULD BE A STRATEGIC BUYER WHO WANTS TO TAKE THEM
BUYER WHO WANTS TO TAKE THEM PRIVATE RIGHT NOW, WHEN YOU’VE
PRIVATE RIGHT NOW, WHEN YOU’VE GOT A COMPANY WITH PRODUCTION
GOT A COMPANY WITH PRODUCTION ISSUES?
ISSUES? >> NO, IT’S PROBABLY NOT
>> NO, IT’S PROBABLY NOT REALISTIC.
REALISTIC. IF YOU READ THE NOTES THIS
IF YOU READ THE NOTES THIS MORNING, JPMORGAN COMES OUT AND
MORNING, JPMORGAN COMES OUT AND SAYS, WELL, HE’S KIND OF THE
SAYS, WELL, HE’S KIND OF THE CEO, AND HE DID SAY IT SO WE’RE
CEO, AND HE DID SAY IT SO WE’RE GOING TO MODEL IT.
GOING TO MODEL IT. BY THE WAY, LOOK AT HOW THE
BY THE WAY, LOOK AT HOW THE BONDS ARE TRADING.
BONDS ARE TRADING. THE BONDS ACTUALLY WENT UP
THE BONDS ACTUALLY WENT UP YESTERDAY.
YESTERDAY. THE BONDS ARE NOT INDICATING TO
THE BONDS ARE NOT INDICATING TO THE STREET THAT ANYONE BELIEVES
THE STREET THAT ANYONE BELIEVES YOU’RE GOING TO HAVE TENS OF
YOU’RE GOING TO HAVE TENS OF BILLIONS OF NEW DEBT ISSUED,
BILLIONS OF NEW DEBT ISSUED, RIGHT?
RIGHT? BECAUSE IF THAT WAS THE CASE YOU
BECAUSE IF THAT WAS THE CASE YOU WOULD HAVE SEEN THE OPTION
WOULD HAVE SEEN THE OPTION REACTION.
REACTION. THE OTHER THING THERE’S A HUGE
THE OTHER THING THERE’S A HUGE DELTA, SPREAD BETWEEN WHERE THE
DELTA, SPREAD BETWEEN WHERE THE STOCK IS NOW AND THE QUOTE
STOCK IS NOW AND THE QUOTE OFFERING OF 4.20.
OFFERING OF 4.20. THERE WOULD BE MUCH LESS THAN
THERE WOULD BE MUCH LESS THAN ARBITRAGE OPPORTUNITIES.
ARBITRAGE OPPORTUNITIES. SO, I THINK, EVERYBODY IS
SO, I THINK, EVERYBODY IS LOOKING AT THIS SAYING, OKAY
LOOKING AT THIS SAYING, OKAY THIS SAY LITTLE TRUMPIAN IN THAT
THIS SAY LITTLE TRUMPIAN IN THAT ELON FEELS HE HAS TO SAY
ELON FEELS HE HAS TO SAY SOMETHING AND THEN PUTTING OUT A
SOMETHING AND THEN PUTTING OUT A STATEMENT.
STATEMENT. LIKE WE’VE SEEN FROM THE WHITE
LIKE WE’VE SEEN FROM THE WHITE HOUSE.
HOUSE. >> WHAT DOES THE BOARD LOOK LIKE
>> WHAT DOES THE BOARD LOOK LIKE HERE, DOES THE BOARD OF TESLA --
HERE, DOES THE BOARD OF TESLA -- THAT’S WHAT I WANT TO GET INTO.
THAT’S WHAT I WANT TO GET INTO. WE TALK ABOUT THE BOARD.
WE TALK ABOUT THE BOARD. HIS BROTHER, YOU’VE GOT A
HIS BROTHER, YOU’VE GOT A MURDOCH.
MURDOCH. >> ELON MUSK HAS MADE HIS
>> ELON MUSK HAS MADE HIS INVESTORS A FORTUNE.
INVESTORS A FORTUNE. BY THE WAY, THE SHORTS THEY HAVE
BY THE WAY, THE SHORTS THEY HAVE NOT MADE ANY MONEY FOR THEIR
NOT MADE ANY MONEY FOR THEIR SHAREHOLDERS.
SHAREHOLDERS. THE LONGS HAVE MADE A LOT OF
THE LONGS HAVE MADE A LOT OF MONEY.
MONEY. THIS IS A 60 BILLION MARKET CAP
THIS IS A 60 BILLION MARKET CAP FROM AN IPO SEVEN OR EIGHT YEARS
FROM AN IPO SEVEN OR EIGHT YEARS AGO.
AGO. >> NO ONE IS DOUBTING THAT THE
>> NO ONE IS DOUBTING THAT THE COMPANY MADE MONEY.
COMPANY MADE MONEY. >> YOU CAN’T LOOK AT THE BOARD
>> YOU CAN’T LOOK AT THE BOARD AND SAY YOU HAVE FAILED
AND SAY YOU HAVE FAILED SHAREHOLDERS.
SHAREHOLDERS. YOU FINANCIALLY CAN’T DO THAT.
YOU FINANCIALLY CAN’T DO THAT. IT WOULD BE TEMPTING TO SAY,
IT WOULD BE TEMPTING TO SAY, HEY, HERE’S SIX OR SEVEN PEOPLE
HEY, HERE’S SIX OR SEVEN PEOPLE THAT ARE RUBBER STAMPING
THAT ARE RUBBER STAMPING WHATEVER HE WANTS.
WHATEVER HE WANTS. DO YOU THINK THAT THE AVERAGE
DO YOU THINK THAT THE AVERAGE SHAREHOLDER WANTS ANYTHING OTHER
SHAREHOLDER WANTS ANYTHING OTHER THAN ELON GETTING HIS WAY?
THAN ELON GETTING HIS WAY? PROBABLY NOT.
PROBABLY NOT. >> BUT THE STOCK HAS MADE A TON
>> BUT THE STOCK HAS MADE A TON OF MONEY.
OF MONEY. IS THE COMPANY PROFITABLE?
IS THE COMPANY PROFITABLE? >> NO, THEY’VE LOST $8 BILLION
>> NO, THEY’VE LOST $8 BILLION IN FOUR YEARS.
IN FOUR YEARS. >> GREAT.
>> GREAT. >> HAS IT HURT SHAREHOLDERS?
>> HAS IT HURT SHAREHOLDERS? WHEN YOU HAVE A FIDUCIARY DUTY
WHEN YOU HAVE A FIDUCIARY DUTY TO A SHAREHOLDER, AS A BOARD OF
TO A SHAREHOLDER, AS A BOARD OF DIRECTOR -- AS A DIRECTOR ON THE
DIRECTOR -- AS A DIRECTOR ON THE BOARD, IT’S ABOUT ARE THE
BOARD, IT’S ABOUT ARE THE SHAREHOLDERS BEING TREATED
SHAREHOLDERS BEING TREATED FAIRLY.
FAIRLY. >> THEY’RE ABSOLUTELY BEING
>> THEY’RE ABSOLUTELY BEING TREATED FAIRLY.
TREATED FAIRLY. THE COMPANY ISN’T MAKING MONEY
THE COMPANY ISN’T MAKING MONEY AND THEY’RE MAKING A FORTUNE.
AND THEY’RE MAKING A FORTUNE. >> THEY’VE NEVER MADE MONEY, NOW
>> THEY’VE NEVER MADE MONEY, NOW THEY’RE SAYING THEY’LL MAKE
THEY’RE SAYING THEY’LL MAKE MONEY IN THE SECOND HALF OF THIS
MONEY IN THE SECOND HALF OF THIS YEAR.
YEAR. THE BEARS ARE SAYING THIS IS A
THE BEARS ARE SAYING THIS IS A MASSIVE DISTRACTION TECHNIQUE.
MASSIVE DISTRACTION TECHNIQUE. WHERE HAVE WE SEEN THIS
WHERE HAVE WE SEEN THIS ELSEWHERE, WHEREBY, IT GIVES AN
ELSEWHERE, WHEREBY, IT GIVES AN OPPORTUNITY TO MAYBE REJIGGER
OPPORTUNITY TO MAYBE REJIGGER SOME OF THESE FORECASTS, AGENCY
SOME OF THESE FORECASTS, AGENCY THEY HAVE THE DISCUSSION ABOUT
THEY HAVE THE DISCUSSION ABOUT FINDING SOMEBODY WHO WANTS TO
FINDING SOMEBODY WHO WANTS TO TAKE ON $60 BILLION IN DEBT.
TAKE ON $60 BILLION IN DEBT. >> JOSH, BECAUSE THE JUST
>> JOSH, BECAUSE THE JUST SHAREHOLDERS ARE MAKING A TON OF
SHAREHOLDERS ARE MAKING A TON OF MONEY DOESN’T MEAN THAT THE
MONEY DOESN’T MEAN THAT THE BOARD IS DOING IT?
BOARD IS DOING IT? >> TELL ME IN A YEAR, WE’LL SEE
>> TELL ME IN A YEAR, WE’LL SEE WHAT HAPPENS.
