
Musk Buys $9.85M in Tesla Stock After Taunting Shorts - john58
https://www.bloomberg.com/news/articles/2018-05-07/musk-buys-9-85-million-in-tesla-shares-after-taunting-shorts
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parvenu74
SO this is a reverse pump-and-dump? Down-talk your company on an earnings call
while giving people reason to question your intelligence, wait for the stock
to drop, then buy. I am not a lawyer or securities regulator, but how is this
not insider trading? Does he just have to wait X number hours after the
earnings call before buying?

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wahern
Insider trading requires material, non-public information. Rants aren't per se
material representations, I don't think, and unless he misrepresented
substantive disclosures and guidance (thus keeping the truth secret) he
wouldn't have been trading on non-public information.

As a board member and major shareholder he's likely to see (and probably
already has, many times) shareholder lawsuits claiming he violated a fiduciary
duty in failing to consider shareholder interests and protecting the market
value of shares. But it might be hard to show damages if the stock picks up as
Musk seems to be betting.

If we're cynical, the act of buying more stock may be an attempt to color his
behavior and put it in a favorable light in expectation of such shareholder
lawsuits if the stock does drop longterm. That is, make it easier to argue
that people were unreasonably construing his rants. I don't think his
intentions matter in terms of liability--they're supposed to be judged by an
objective standard--but in as much as Musk has a history of this behavior yet
is still a very successful businessman with successful ventures, Musk himself
partly defines what's objectively reasonable behavior and what are objectively
reasonable reactions to that behavior. Reasonable isn't always defined by how
the majority of people behave; it can be defined by what it takes to find
success for yourself and others.

