Elon Musk's $50 billion question

How much is a tweet worth?

Not for the first time, Elon Musk's Twitter antics were all anyone could talk about yesterday.

Over the weekend, Musk offered to sell 10% of his stake in the company if people on Twitter voted in favor of him doing so, allegedly because "much is made lately of unrealized gains being a means of tax avoidance," according to his tweet.

Musk has said he doesn't pay personal taxes because he takes no salary from Tesla or his other companies aside from stock. He has previously opposed a proposal to tax billionaire wealth from unrealized stock gains. The proposal was floated and then dropped by Democratic congresspeople in late October.

Musk should go ahead with the stock sale, at least according to the majority of the 3.5 million people who voted in the poll. And he promised to abide by the results.

• "I was prepared to accept either outcome," he said after ending the vote on Sunday.
• By the end of trading yesterday, Tesla stock was down nearly 5%. That means Musk asking a question about selling roughly $20 billion of Tesla shares cost Tesla about $50 billion, though the price seems to be rebounding this morning.

Some might just take Musk at his word that he proposed the sale to answer the tax avoidance question. But there are quite a few speculative reasons he might have put this poll in the Twitter field:

• The most credible reason: Musk has stock options that expire next August if he doesn't exercise them, and their complicated structure means they likely aren't exempt from taxes (unlike the options of some other tech CEOs). The tax bill will probably be well over $10 billion, meaning he'd need to sell stock just to pay, regardless. In that case, this poll was really just for fun — and probably to get some attention — and he would have sold the stock whether he created a poll or not.
• My favorite theory: Tesla stock has hit record highs recently, making this a perfect moment to come up with some kind of cover so that he can cash out and secure his wealth. This version would be even more fun if secretly Musk believes that Tesla is way overvalued, and so he's taking advantage before the rest of the world finally comes to its senses.
• Taking Musk at his word: People are giving him lots of criticism for his failure to pay taxes. Time to fix that.
• The most Muskian version: It's just fun! He was drunk on Teslaquila! Why not mess with the SEC and the angsty do-gooder reporters like me?

Speaking of the SEC, isn't Musk supposed to clear market-moving tweets with a company lawyer? After Musk claimed in 2018 that he had "funding secured" to take Tesla private (he didn't), the commission struck a settlement under which Tesla is required to hire a "Twitter sitter" to approve Musk's tweets about Tesla.

• It seems pretty clear that the freewheeling "Lord Edge" isn't abiding by those requirements.
• But the agreement has proven hard to enforce, and legal experts think Musk may not have broken any rules, since he was speaking on his own behalf as a shareholder, not as a company executive.

Were the theatrics even worth it? All told, Musk lost around $12 billion with the drop in share value — almost as much as he'd need to pay in taxes anyway. But as the saying goes: Never wrestle with the existential meaning of an Elon Musk tweet. You both get confused, and Musk likes it.

— Anna Kramer (email | twitter)

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People are talking

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Since March, Annie Orenstein has served as a research manager at Twitter. But in her free time, she runs a storytelling platform for women.

Orenstein founded Dispatch from Daybreak, which encourages women to write letters to their earlier selves on issues ranging from loss to race and motherhood. The entries are called dispatches, and people can use the platform to write their own or read others'. Orenstein's platform could be a good alternative to scrolling through Twitter before bed.

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