Elon Musk takes over Twitter

Not surprising. Also shortsighted, but this is Elon Musk in a nutshell. His M.O. is to extend the cost of things as far into the future as possible, and he's been continually rewarded for doing that via bailouts, and a distorted rate environment that allowed Tesla to borrow over and over again and dilute its equity without being punished.

If he is offering preferred equity at a 20 year maturity paying 14 percent with the interest rate increasing by 75 basis points in the seventh, eighth or ninth years, there will be takers. I'd imagine that kind of healthy return amply offsets the risk for a lot of people. But if Twitter lives long enough for those people to collect that interest, Musk will be hamstringing the company so badly that he's really just giving his Tesla holdings (the source of his wealth) a reprieve today to hamstring Twitter's ability to profit even worse later on. For Elon Musk, though, all that matters is the time it will buy him. He figures he'll be able to find a way to kick the can again when he needs to.

 

He's renegotiating. Stock prices are dropping broadly, and if he had done his carnival barker act now instead a monhth ago, he realizes that Twitter would have been worth a lot less. So he's trying to renegotiate.