Market volatility continues within the Chinese sector and, of course, as usual, with Tesla Inc. Finally, the Communist Party decided to ease their zero-COVID policy, a policy that was obviously failing. I called this last year. I’m not sure why the party did not get it. BABA has gapped up beautifully. Today, in the community, we had some very good trading on BABA and TSLA. The breakouts were clean with a bullish Level 2 signal that Paras and I both caught nicely. The recap is full of educational material, please watch it here.
These days, we only talk about two things: Chinese companies such as BABA that we traded today, and Tesla. Well, thanks to Elon Musk, TSLA is moving up and down almost every day and is hovering around its 52-week low. Elon Musk is asking his bankers to provide him with new loans backed by Tesla shares to replace some of the high-interest debt he has had to borrow. Elon Musk has around $13 billion of debt taken on as part of his $44 billion acquisition of Twitter (probably the worst acquisition in the history of acquisitions) and he has annual interest costs of about $1.2 billion if the current debt structure remains in place, more than Twitter’s core earnings for the whole of 2021. That is about a $4m loss a day. Not great.
Elon Musk has issues with not only interest rates but pretty much everything else. If you want to be the richest person in the world, you apparently need to be a troublemaker. Elon Musk has never been a normal person, and his career and ventures were always on the extreme. Tesla was on the verge of full bankruptcy several times. Elon Musk has a history of making extreme comments and making fun of politicians, investors, and philanthropists such as Bill Gates. He usually makes his way through everything like a bulldozer. Now he is in a fight with San Francisco’s municipal government.
He earlier moved Tesla’s headquarters from California to Texas after clashing with Alameda County government officials, who wanted him to shut down his factories in the early days of the COVID-19 pandemic. This time, he’s attracting the attention of San Francisco’s building inspectors after a complaint involving Twitter Inc.’s headquarters.
Musk has converted several of Twitter’s extra conference rooms into makeshift bedrooms, complete with side tables and armchairs. In some photos, the couches have been adorned with pillows, blankets, and bedsheets. Employees at Twitter – and those from Musk’s other companies like Tesla and SpaceX, who have traveled there to help Twitter out – are apparently working so hard and for such a long time that they need to sleep at the office.
But now, San Francisco’s Department of Building Inspection is investigating the setup. Converting commercial space into residential space requires things like applications and permits, and Musk, of course, doesn’t appear to have done any of that. He responded to news of the investigation by criticizing Mayor London Breed on Twitter, in front of his 120 million followers.
“So city of SF attacks companies providing beds for tired employees instead of making sure kids are safe from fentanyl,” Musk tweeted on Tuesday. “Where are your priorities @LondonBreed!?”
An investigation by San Francisco’s officials may seem like small potatoes for a man who doesn’t seem to care much about rules, but Musk doesn’t tolerate much of anything getting in his way. His clash with city officials could be the beginning of the end of Twitter’s long history in San Francisco. Even though it’s the city where Twitter was invented and where the company has been headquartered since 2006, Musk has already shown little reverence for the way the company worked before he took over.
After his prior corporate spats with California officials, Musk’s other prominent companies, including Tesla, SpaceX, and the Boring Company, are located in Texas, where Musk is a resident. (Governor Greg Abbott has welcomed the idea of Twitter moving to Texas.) That would be Twitter’s most likely future home.
Yes, it seems very problematic to move headquarters, but Musk has done it before, and as he’s shown during his first month running Twitter, he has no problem upending employees’ lives with big asks.
I am not a fan of Elon Musk, but I really respect his attitude of crushing everything that comes in his way. That attitude of “nothing stops me” is something that will help him long term and in a big way. This is something we all should learn. Whether it be in trading or the other elements of your life, nothing should stop you from achieving your dreams.
The next round of Peak Capital Trading’s boot camp starts soon. This will be the most exclusive boot camp we have run to date. Only a few limited spots will be open and we will offer a significantly more private and individual approach for the traders participating. It will be exciting. Make sure to get ready for the announcement next week!
Also, we are set for our next live trading workshop. It will be in San Diego on March 2 and 3, 2023 at the Hard Rock Hotel. It will be exciting, and we will soon open registration for it. There will be 2 days full of live trading courses and webinars. Stay tuned!
To your success,