Entrepreneur, engineer, and professional troll Elon Musk is at it again.
He put out a tweet over the weekend asking if he should sell 10% of his Tesla stock so he could pay taxes. He has pledged to do whatever Twitter fools decide. Here’s the tweet:
In a later tweet, Elon agreed to abide by the results.
Unrealized Gains
People get taxed on all sorts of things. Income and capital gains are just the biggest hits.
That said, rich people don’t pay income tax because they don’t take a salary for the most part. Furthermore, they don’t pay capital gains because they only sell stock when they have to.
When your average billionaire needs pocket money, they borrow against their stock at low interest. This allows for impulse buys in the way of mansions, mega-yachts, and rocket ships.
Pay up, Musk
As you can see from the tweet above, more than 57% of the 3.5 million Twitter followers who answered the poll voted for Musk to sell his shares and pay his taxes. He has 62.8 million Twitter followers in total.
This is great public relations. What people will remember is that he thought about the good of this country and paid his fair share in taxes.
Spin and Lies
This is all foolishness, of course. CNBC is reporting that Musk would have to sell a chunk of his stock anyway due to a looming expiration date and a tax bill of $15 billion.
According to CNBC:
Musk was awarded options in 2012 as part of a compensation plan. Because he doesn’t take a salary or cash bonus, his wealth comes from stock awards and the gains in Tesla’s share price. The 2012 award was for 22.8 million shares at a strike price of $6.24 per share. Tesla shares closed at $1,222.09 on Friday, meaning his gain on the shares totals just under $28 billion.
The company has also recently disclosed that Musk has taken out loans using his shares as collateral, and with the sales, Musk may want to repay some of those loan obligations.
The upshot is that Musk has to sell by next August and take the tax hit. Furthermore, he might have noticed that TSLA’s share price is a tad elevated. Some might even say it is overdue for a sell-off.
Being the savvy individual he is, this ploy gives him a way to look like a good guy while dumping some shares. It avoids the bad look of not paying taxes, and it keeps the stock propped up while he sells.
After all, he isn’t selling because the stock is overvalued, the competition is picking up, and time is running out on his stock options…
He’s being a patriotic American and paying taxes because Twitter voted that way. And it gets better…
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Lorde Edge
In other news, Elon Musk changed his Twitter name to “Lorde Edge,” and almost immediately someone created a Lorde Edge crypto. The price went from a 24-hour low of $0.000002724 to $0.0000265, which was a six-hour gain of 360%, before selling off again.
It’s unlikely that Musk had anything to do with the flash-in-the-pan token, but judging by the misspellings, it was a scam group trying to make a quick buck from his tweets.
A Safer Way to Buy Alt-Coins
If you want to speculate in alternative cryptocurrencies, you should stick with the ones that are backed by people with a long history in the tech world. The cryptos should have a real reason for existing in that they solve a real problem and they should also be the dominant player in that niche.
I’ve found six of them that fit the bill. One coin I recommended is up over 180% in just a few weeks. It was founded by one of Ethereum’s (ETH) co-founders and allows blockchains to easily share information with each other.
As we know, cryptos are hot. The total crypto market cap just hit $3 trillion, up from $1.7 trillion just two months ago. Tokens are running yet again. If you want to speculate, check out my presentation before you miss the boat.
All the best,
Christian DeHaemer Christian is the founder of Bull and Bust Report and an editor at Energy and Capital. For more on Christian, see his editor’s page.
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