I wish a competent economist could blog that Musk (and the other uber rich) don't have liquid cash to pile up on their yacht the way the graphics imply.
Even the act of selling his stake in tesla and X and spacex would alter the value of the holdings, alter the tax income for some nation state, the act of printing the money would in turn demand time and effort, shipping the money would incur costs.
Having the effective influence over investment disposition of $1T is amazing but it isn't actually the same thing qualitatively as "one trillion dollars" nor is it just a quantitative function over "1 million dollars". Because it's 1/30th of the entire US economy (around $30t) and so materially alters 3% of the value of the US working capital, and a little over 1% of the entire US stock market at $75t)
In order to have the money he'd create an instant liquidity crisis. He'd hoover up all the share trading cash, and so would instantly devalue all the other stocks. It would be a massive event.
A billionaire liquidating their shareholdings is 1,000th the impact. It would be notable but not an earthquake except in the narrow space they sold in. Billion dollar trades are done carefully. Million dollar trades are unremarkable.
His net worth is calculated in a sub multiple of actual sales, which are also huge, but it's not the trillion either. He didn't stake a trillion and sell a trillion. The trillion is a mutable legal fiction.
fsuts10 hours ago
But it’s the same for all non equity assets. As no one has everything in cash.
A private company owner needs to sell his company
A high net worth investor in a fund will have signed up to maximum redemptions and may be locks out during a crisis
Most assets have varying liquidity and you can only surely judge net worth as its present book value
chadash6 hours ago
> don't have liquid cash to pile up on their yacht
I think a reasonable metric would be "you have 2 years to sell your assets and convert to cash (or something super liquid like treasuries)". This accounts for people who hold things like farm land or real estate that can't just be liquidated tomorrow. By this Metric, the values for many of the billionaires out there are real. Bill Gates, for example, hardly owns a significant stake in Microsoft anymore, but he does have lots of illiquid assets like farmland and real estate. Brin/Page/Bezos still have significant stakes in their companies, but the companies stand on their own at this point and I doubt that shares would go down a ton if any of them liquidated over the course of a year. Zuckerberg probably can't sell his meta shares without a reasonable decrease in value, so there'd be some haircut, but it's still an incredibly valuable company without him.
But Musk is at a different level. I can't imagine him selling his stakes in his companies without the stocks plummeting more than 50%.
aniokono11 hours ago
Someone in Nigeria once said it's paper money. But wait, so he goes and buys other companies and they all have the same paper money?
Maybe such invisible "paper money" isn't such a bad thing if he can go shopping with it.
Gud6 hours ago
No, what Elon can do(and is indeed doing) is to take out loans at a fantastic rate.
No need to sell anything.
chistev12 hours ago
We don't care about these semantics. He's a trillionaire.
maxrf11 hours ago
I do; because it matters in the 'real world' ;-}
ferrouswheel11 hours ago
It doesn't matter at all.
Almost no one with real wealth has liquid cash because liquid cash depreciates.
throwaw126 hours ago
what if he buys 20 $50B companies with that leverage? total revenue of those companies combined may exceed $1T. Does it mean now he has $2T?
farrukh23buttt9 hours ago
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