Tesla’s $1B Buy Turns Into $12B+ Gain
Elon Musk just pulled off one of the boldest stunts I’ve seen in the stock market recently. He bought roughly $1 billion worth of Tesla stock, insignificant to him, but as he very well knows, highly important to the markets. Shares spiked about 7% after the news. For perspective: Musk owns ~413 million Tesla shares, so that one-day move inflated the value of his stake by almost $12 billion. It’s incredible. I think Elon Musk might just have created the most insane way to expand your fortune. Spend $1 billion, get $12 billion back. That’s not investing, that’s an infinite money glitch straight out of a video game.
Now, the question that arises: should this even be allowed? At what point does “signaling confidence” cross into blatant market manipulation? I mean, let’s be honest, it’s hard to believe that Elon Musk, god of the Tesla cult, has no idea what a move like this would incite. If a mid-cap CEO tried this trick, they’d probably get a letter from the SEC by Friday. With Musk? Markets cheer, Twitter laughs, and CNBC calls it “bold leadership.” Though, on the other hand, who really cares about mid-market CEOs? It’s another reminder of how Musk plays by a completely different set of rules — and somehow, the rules keep bending for him. That is admirable. He is the definition of a constant winner. There’s no need to deliver on promises either, since he has created a sect-like following of people who believe a P/E ratio of 200 is justified for a market-share-losing EV manufacturer.
Of course, credit where it’s due: as long as it’s legal, it’s brilliant. In no way is it Musk’s fault that you can just move the markets like that. And we shouldn’t kid ourselves, many, and I repeat, many, famous investors have done similar things before him. Just think of Bill Ackman who notoriously drives up share prices just by hinting at certain things during CNBC interviews. Musk signals conviction, squeezes shorts, energizes retail, and adds tens of billions to his net worth in one move. Honestly, props to him for pulling it off. But it also exposes the fragility of today’s market psychology. Investors aren’t looking at fundamentals anymore, just at pure hype and announcements. If Musk comes out tomorrow to talk about flying cars, and a $1 trillion TAM for 2035, the stock would jump again. No proof needed to back it up.
And here’s the uncomfortable part: when one man can push a button and essentially print himself $12B overnight, what does that say about “efficient” markets? This isn’t healthy price discovery. This is hero worship on steroids. It’s fun to watch, sure, but it’s also dangerously close to turning capital markets into a billionaire playground. And again, it’s in every billionaire’s right to exploit options to increase their net worth. But as regulators, maybe you should be asking whether the boundaries in place aren’t a little bit “loose.”
I like guys like Musk or Ackman, people exploring their options and trying to create the most value for themselves. They are the epitome of a capitalist, market-driven system. It’s fun to watch and it serves as inspiration and sparks ambition.
