For brokers who lent shares out this would be an absolute headache. They would have customers coming at them for these extra shares, and have to make good on them. Any synthetic share would be a debit they have to take right out of the blue. And customers who sold short, would not really always be responsible, or able to be tracked down, leveraged etc to pay that up. In short, carnage for multiple types of people involved in shorting. How can we make this happen?
And, make it happen with minimal warning. Two weeks notice to maximize damage.
Concerns from FUDsters can be easily anticipated (and neutralized). Do the Rights Offering immediately after the 10-Q drops so a strong and growing cash position demonstrates the folly of the 'needs cash' FUD. Point out that you weren't diluted if you are a long term investor: the longer, the better you did (and by implication, the better you will do in the future).
Combine the Rights offering with a 2:1 share dividend so a rising tide lifts all boats. Point out to the day- and swing-traders that if they were doing it right, they made far more money practicing their craft than long-term'ers are getting through the Rights offering. But they want their
unfair share, and don't care about reason (
Too bad, So sad. Cry me a river).
Point out that the Rights offering merely makes long-term investors whole, and that the Rights offering is partially to encourage long-term investing. Rights could also be granted for X.com "linked" companies too:
Starlink, Neuralink, Hyper-Bora-link...
Do this now while the TSLA share price is low, so that Rights owners are encouraged to hold (not sell) due to imminent SP appreciation (Plaid S/X, 4680s, Berlin, Texas, FSD, Model 2 in the pipeline): "
Most exciting product lineup in the world". Now who said that again? (you were warned)
Finally, for those whinging about "
fairness", you want to sell your cake and eat it too? Sold. EZ 2 spot the traders up in here! This Rights offering would be the moral equivalent of stock options issued to employees: its a financial reward for long service and hard work (something we long-term investors understand well).
Or do you prefer the
freeloader diva "
team leader" who rides in the middle of the peleton 5 hrs a day, then sprints out to grab the gold in the final 400 m? (obligatory TdF reference)
Cheers!
www.tesmanian.com
