Hi folks,
Zooming out of stock sale events over the past 7 weeks, the larger picture is that Elon has
created a forcing function for change on Wall St. regulation.
Simply by allowing hedge funds to 'front run' his options execution share sales, Elon is both paying LESS income tax, and denying the US Gov't those addtional funds. And as we see now, the SP value snaps back to pre-sale levels as soon as the selling is done, leaving both Elon's share count and net worth higher.
Going forward, the Legislative Branch now has two choices:
- continue to squirm as Elon takes an arbitary tax discount at his discression (he has more than sufficient volume of vested shares banked right now from the 2018 CEO comp. plan to create any discount he wants), or
- reform SEC rules so that selling by insider owners is done is a controlled, orderly fashion which DOES NOT roil the Market (ie: -25% for a 1% volume sale), damage shareholders, and cost the Gov't billions in income tax receipts
SMR hints at what is going on in this video. He doesn't quite get there, but
this segment is worth a watch IMO:
Elon’s Musk’s 420 IQ Secret Tesla Stock Sale Strategy | SMR
In summary, Elon has effectively created a forcing function to create positve change in Government policy. Further, it would now be trivial to convince other Billionaire owners that they too can save a bundle on taxes by exercising their shares options in public, roil the market, short the Gov't, and influence public opinion.
Or, the U.S. Gov't can just make some simple changes in SEC regulations. Which do you think will happen first?
Cheers!
