Tesla shareholders approve $1T pay package for Elon Musk

https://www.nbcnews.com/tech/elon-musk/tesla-elon-musk-shareholder-meeting-1-trillion-dollar-pay-package-rcna242223

by yoyohello13 • 9 months ago

25 15 9 months ago

duxup• 9 months ago

This all feels like a sort of suicide pact.

If they don't give Elon massive amounts of cash, then he maybe walks and they pick someone new as CEO and Tesla stock might start getting evaluated like any other stock ... the would result in a pretty sharp downward trend.

Keep Elon and the aspirational (that's the word I picked) stock price maybe holds?

techblueberry2• 9 months ago

We live in the influencer era.

Reubend• 9 months ago

Before the outrage comments pour in, take a look at the conditions he has to meet (per the New York Times):

...this 12-step package asks Mr. Musk, the company’s chief executive, to vastly expand Tesla’s stock market valuation — to $8.5 trillion from around $1.4 trillion — while hitting a variety of other goals. Those include selling one million robots with humanlike qualities and 10 million paid subscriptions to the company’s self-driving software.

The headline $1 trillion figure only comes into play if he hits a very lofty goal: 6x the company's valuation and sell a bunch of expensive robots.

I don't think this is nearly as crazy as people are making it seem. It's a huge reward for a goal that seems unlikely to be achievable in a short time frame.

basiccalendar74• 9 months ago

A large cap stock increasing by 6x is not "unlikely to be achievable".

Apple went from 1T to 4T valuation in just 6 years. why did Apple not award 500 billion to Tim Cook for this achievement?

m463• 9 months ago

I think the thing is that tesla is tanking, but apple has more diversity and a modicum of success / growth.

Libidinalecon• 9 months ago

It isn't a bad deal for shareholders.

In the grand scheme of things though it is very much a "let them eat cake" moment in the history of neoliberalism. It is just such a total absurdity. I even read the words "equitable pay package"

The same week NYC elects Mamdani. As if these are two unrelated events.

I have been a free market person my whole life but when you start approving pay packages to jump Marcus Crassus in historical wealth, maybe it is a sign something is severely broken?

The neoliberal shareholder class will never fix this because they are unable to see anything is broken. "The market is always right".

The problem is people vote in a democracy.

The counter arguments will be so trivial to make too. How are these Tesla goals hit without public roads again? What is the AMZN share price without the use of public roads?

I completely forget in all this that the current federal government is so dysfunctional that it not even running.

It is hard to imagine a future in America that is not socialism with American characteristics.

api• 9 months ago

I have suspected for a long time that the root of the problem is how we distribute new money.

New money means basically printed money. We have an inflationary system, and I’m on the fence about whether that’s a good thing versus the other different problems you get with deflationary money. But that’s beside the point.

The fair way to distribute new money would be to drop it from helicopters, more or less. Instead we give it to banks. New money enters circulation at the top.

That does a couple things. First it inflates assets, which is one cause for why housing went nuts. Second, it transforms the economy from a competition to sell the best product to customers into a competition to be first in line for inflationary money distribution.

That’s what we have now. You are not the customer. There are no customers. The stock is the product and the Fed is ultimately, after a chain starting with big banks, the buyer.

Companies make more money selling their stock than selling their product. Selling a product is only valuable insofar as it makes the stock look better to buyers who have not yet realized productivity is no longer the goal, who have not yet reached /r/wallstreetbets levels of enlightenment about the new nature of the system.

Over time the trend is for the whole system to drop the pretense of productivity. At the street level investment fully degenerates into gambling and is finally replaced, as is happening now, with actual gambling. At the elite level people like investors and founders start to realize that creating value has degenerated into a show to attract investment capital (new money), and so they should just drop the pretense. In fact it makes sense to drop the entire pretense of operating a productive economy. The political class can also drop the pretense of running a productive society and just declare themselves kings and hold decadent parties, as we're seeing now.

So we end up with kings ruling over a casino. Which is why we have a wannabe king who is a former casino boss.

(Deflationary money can lead to serfdom too but via a different failure cascade that starts with a collapse in investment since holding money is less risky.)

If, instead, we implemented QE by dropping money from helicopters, the whole economy would be capitalized and would start spending money purchasing things people want. Businesses would remain oriented toward selling things to customers and to one another, with stock sales being secondary fund raising activities as they should be. Investment would continue to be a better bet than gambling.

techblueberry2• 9 months ago

I don't have a problem with this per-say (I mean it offends my sensibilities and fuck musk) But the biggest problem I have is if Musk can just meme stock the company into a 8.5 trillion dollar valuation.

Sure on the one hand you can say, well it's a private company, and if the shareholders get wealthy who cares?

But like, our economic rewards should be tied to value to society, and I'm being pretty generous in defining value to society in capitalistic terms here. If you sell 100 million cars, then obviously society values those cars and if you want to get ridiculous sums of money so be it, so if he really does robotaxi and FSD and sells a million robots, then fuck it.

(On the other hand, no I'm not ok with this, because money isn't just a reward, it's power, he's not buying yacht's he's buying goverments, but that's a story for another day)

ZeroGravitas• 9 months ago

If trying to pivot into selling expensive robots kills the company then it is crazy.

ChrisArchitect• 9 months ago

Earlier: https://news.ycombinator.com/item?id=45841026

atonse2• 9 months ago

My problem with all this is that Tesla depends too much on one person, Musk.

I shudder to think about what would happen to the stock valuation if he were somehow not able to perform his duties anymore.

That’s why it just feels precarious. I don’t know any other stock that has a bus number of 1.

Maybe Berkshire Hathaway?

Apart from that, the goals/milestones are so huge that the pay package doesn’t seem too crazy.

ghtbircshotbe• 9 months ago

Berkshire has many talented managers and I believe is known for being fairly hands off. If anything Berkshire is undervalued compared to the industry averages for its component companies.

TheAlchemist• 9 months ago

Berkshire is a money making machine with or without Buffett. Its market cap is 30% lower than Tesla, while it brings ~100B / year in net income - most of which is from very stable, boring businesses.

As Warren liked to say: "I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will".

That's his portfolio now - he won't promise robots or AI, but he can guarantee solid profits for 10 years to come, regardless of his presence.

atonse2• 9 months ago

Damn I didn’t need more reasons to admire Buffett than after reading that quote hehe.

richardatlarge• 9 months ago

Money can't buy happiness. This will be history's most expensive case study.

Tesla shareholders approve $1T pay package for Elon Musk

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