Speaking in a Twitter Spaces audio forum, Musk also assured investors Tesla hadn’t “skipped a beat on execution” since he took over Twitter. Twitter required an initial period of intense focus to get its “insane … costs under control” to stop it from going “flat bankrupt” next year, Musk said.
“I was still doing Tesla work during that time as well, by the way. And I think really Tesla has really not skipped a beat on execution,” he said. “The Tesla team is doing an incredible job across the board in execution.”
Tesla share prices fell further on Thursday over concerns about slowing demand for electric vehicles. Musk’s stock sales and focus on Twitter have also been blamed as a contributing factor, but Musk rejected this on Thursday, blaming the Federal Reserve’s interest rate increases.
‘Won’t Sell Stock’
Musk sold around 22 million Tesla shares between Dec. 12 and 14, valued at roughly $3.6 billion, according to a Securities and Exchange Commission filing. He has sold around $23 billion in Tesla shares since April, with much of the funds going toward his $44 billion acquisition of Twitter.
On Thursday, he promised not to sell any more stocks for the next two years.
“You have my commitment that I won’t sell stock until, I don’t know, probably two years from now. Definitely not next year under any circumstances and probably not the year thereafter,” Musk said.
Musk said he needed to sell some of his stock “to make sure, like, there’s powder dry … to account for a worst-case scenario.” The phrase “powder dry” means to always be prepared to take action yourself. Musk has previously made promises about not selling Tesla stock before subsequently selling it.
Less Focus on Twitter
Once he gets “the engine of engineering at Twitter” humming to ensure the social network can develop new features, Musk expects the social network to take up far less of his focus.
“In the grand scheme of things, the amount of cognitive load that Twitter represents is low. I mean, it is a much simpler problem than Tesla or SpaceX, obviously, by a hundred miles,” Musk said.
“I’d say it was a high cognitive load for about a month. At this point, it is a moderate cognitive load. A month from now, it’ll be, I think, low,” he continued.
“And if I look back and say, like: ‘What are actions I could have taken? Was there something that I failed to do at Tesla that could have been done and would have improved our execution?’ I literally can not think of a single thing.”
Musk noted that he hadn’t missed a single important meeting at Tesla since taking over Twitter, with both primarily based in the Bay Area of San Francisco.
The real issue is not how much time Musk might be putting into Twitter versus Tesla; according to the billionaire, it is the Federal Reserve’s “radical interest rate changes” pushing up the price of cars. Musk predicted a “serious recession” next year “comparable to 2009,” with decreasing demand for big-ticket items like vehicles.
With respect to global demand for vehicles, Musk said that interest rate rises push up the costs of both new and used cars, which he noted are mostly bought with leases and loans. He said a decrease in car demand, along with the Fed’s rate increases pushing up the cost of a car, creates a “double whammy.”
“So now you have structural demand, which is obviously going to be lower in a recession, and you’ve amplified the effect of cost of a car because they’re almost all bought with debt, so you get a double whammy, is what I’m saying,” he said.
Policymakers at the Federal Reserve voted at their last monetary policy meeting on Dec. 14 to hike the benchmark federal funds rate by 50 basis points to a target range of 4.25–4.5 percent, the highest level since late 2007. It was the seventh consecutive rise since March, totaling 425 basis points.
Fed Chair Jerome Powell said at a press conference after the meeting that the fight against inflation has a long way to go. Most officials expect rates to rise over 5 percent next year, which is more than originally predicted.
“I wouldn’t see us considering rate cuts until the committee is confident that inflation is moving down to 2 percent in a sustained way,” Powell said.
Musk rejected the idea that his political tweets are having an impact on Tesla share prices, contending that automotive demand is “problematic almost anywhere in the world” and “not everywhere cares about my political comments.”
“I really just don’t think this is a significant factor,” he said.
In Musk’s opinion, the U.S. economy is already in a period of deflation, and the Fed’s predictions are based on old data.
“The thing that I think most people don’t realize is how—I sound like a broken record on this—how big of an impact the Fed rate level is, at over 5 percent, if we are in a deflationary environment, which I think we are in,” he said.
“Objectively, we are,” he added.
Musk said it was “blowing my mind” that the Fed has raised rates to their current level, and said he believes that they are “dealing with old information.”
“The economy right now is like a car driving around on a cliffside road, and the Fed is driving it by looking out the rearview mirror,” he said. “In fact, it’s not even looking out the rearview mirror. It’s looking at a video taken out of the rearview mirror that’s like three months old. So obviously, this is not a good way to drive a car on a windy road.”
The Epoch Times has contacted the Federal Reserve for comment.
Will America-First News Outlets Make it to 2023?
Things are looking grim for conservative and populist news sites.
There’s something happening behind the scenes at several popular conservative news outlets. 2021 was bad, but 2022 is proving to be disastrous for news sites that aren’t “playing ball” with the corporate media narrative. It’s being said that advertisers are cracking down, forcing some of the biggest ad networks like Google and Yahoo to pull their inventory from conservative outlets. This has had two major effects. First, it has cooled most conservative outlets from discussing “taboo” topics like Pandemic Panic Theater, voter fraud, or The Great Reset. Second, it has isolated those ad networks that aren’t playing ball.
Certain topics are anathema for most ad networks. Speaking out against vaccines or vaccine mandates is a certain path to being demonetized. Highlighting voter fraud in the 2020 and future elections is another instant advertising death penalty. Throw in truthful stories about climate change hysteria, Critical Race Theory, and the border crisis and it’s easy to understand how difficult it is for America-First news outlets to spread the facts, share conservative opinions, and still pay the bills.
Without naming names, I have been told of several news outlets who have been forced to either consolidate with larger organizations or who have backed down on covering certain topics out of fear of being “canceled” by the ad networks. I get it. This is a business for many of us and it’s not very profitable. Those of us who do this for a living are often barely squeaking by, so loss of additional revenue can often mean being forced to make cuts. That means not being able to cover the topics properly. Its a Catch-22: Tell the truth and lose the money necessary to keep telling the truth, or avoid the truth and make enough money to survive. Those who have chosen survival simply aren’t able to spread the truth properly.
We will never avoid the truth. The Lord will provide if it is His will. Our job is simply to share the facts, spread the Gospel, and educate as many Americans as possible while exposing the forces of evil.
To those who have the means, we ask that you please donate. We have options available now, but there is no telling when those options will cancel us. We have our GivingFuel page. There have been many who have been canceled by PayPal, but for now it’s still an option. Your generosity is what keeps these sites running and allows us to get the truth to the masses. We’ve had great success in growing but we know we can do more with your assistance.
Thank you, and God Bless!
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