Who is Elon Musk really?

[red750]

[Marty_d]

I must watch that recent movie "Civil War".

Going to be prophetic I think 

[old man emu]

14 minutes ago, Marty_d said:

I must watch that recent movie "Civil War". Going to be prophetic I think 

You could read the book https://en.wikipedia.org/wiki/Civil_War_(film)

[pmccarthy]

A lot of good music came out of the Civil War. I have the CD.

[facthunter]

It won't be that CIVIL, either. Trump is above all things, PROFIT IC (For HIM) . When the GAZA strip is rebuilt  there will be two Queue's The Palestinians get in the FAR one which will be in Egypt.   "Greed is Great". Nev

[Grumpy Old Nasho]

3 hours ago, old man emu said:

To the common person, a thing which is not a physical object has no value. So it is said that Musk is the wealthiest person in the world, but surely that wealth is not totally in physical things.

Do you pay compulsory third party insurance premiums? The intangible promise of a payout to injured victims is not physical, but has enormous value to the common person who thinks CTP insurance is the best thing since the Model T and sealed roads.

[old man emu]

13 minutes ago, Grumpy Old Nasho said:

Do you pay compulsory third party insurance premiums?

I can see your point and I agree  with your supporting argument, but you said it yourself, The intangible promise. I was talking about tangible things, like the car.

 

While I may possess a document confirming the contract between the insurer and me, I cannot sell you or anyone else the promise. Sure, if I sell you the car, the ownership of the promise goes with the car, but that ability to transfer the promise was agreed to between the insurer and me when the contract was entered. If I sell the car with 6 months' rego on it, I can't recoup the associated contract costs I paid on entering the contract, not can I recoup the value of the premium that gained me the promise for the 6 months before the sale. So to me, the promise has no value at point of sale. Obviously, it has value to the buyer, but once the sale is completed, the promise has no value to the new owner.

[facthunter]

Did you Yearn to be a LAWYER in a past life?  Nev

[old man emu]

9 minutes ago, facthunter said:

Did you Yearn to be a LAWYER in a past life?  Nev

I could never go over to the Dark Side.

[Grumpy Old Nasho]

30 minutes ago, old man emu said:

If I sell the car with 6 months' rego on it, I can't recoup the associated contract costs I paid on entering the contract, not can I recoup the value of the premium that gained me the promise for the 6 months before the sale.

If you apply to have that 6 months refunded, you'll get it. It's yours.

[facthunter]

ONLY IF you cancel the Rego and LESS handling charges (which is fair enough)  Nev

[octave]

4 minutes ago, Grumpy Old Nasho said:

If you apply to have that 6 months refunded, you'll get it. It's yours.

I consider myself of reasonable intelligence but I am having trouble grasping the point you are trying to make.

[Grumpy Old Nasho]

15 minutes ago, octave said:

I consider myself of reasonable intelligence but I am having trouble grasping the point you are trying to make.

Well what facthunter said.

 

But common motorists place great value on CTP premiums even though they're buying an intangible, and lose it all if they never make a claim.

[Jerry_Atrick]

Valuation and wealth deserve a topic on their own.

 

You may not be able to transfer the value of your CTP, for example, and there are examples of many investments that cannot be transferred (some private placements, which is effectively debt offered to a select group of investors, cannot be transferred from investors unless the investor goes broke). However, the commercial value of the CTP can be transferred in two ways. Firstly, the original inderwriter may use a different underwriter and transfer the monetary value and risk to. Secondly, assuming the portfolio of insurance creates a balance sheet surplus and profit, by buying/selling the shares of that underwriter, you can transfer the benefits of the portfolio.

 

On the topic of valuations in general, there are two sides to the market - the demand and supply side. And value is driven by both. For example, I have many times been the only one interested in a house for sale. I have put an offer in well below aasking price, but not too stupid, to get the negotiations going and have met with complete silence. The reason, unless there is a distressed sale, the item has value to the seller too, under which they are not willing to trade. All you have is, in a period of time, no market for the product.

 

You may be surprised to know the vast majority of share trading volume is not executed on the exchange. They are effectively private negoitiations, after which, the trades are reported to the exchnage (usually real time). Banks and other instirutions have their own trading "venues"; mini exchanges - these can be dark pools or lit pools.. Consequently, on exchange, the top of the "market" (a market being an individual share or other instrument), is usually shown for some time, before there is a trade on the exchange. The top of the market is the best bid and best offer.. Often, on very liquid insturments, there is a cent between them.

 

Valuing stock is somewhat subjective, but it is based on the future earings of the company. Also the individual stock price is meaningless; one has to look at the market capitalisation and the capital structure, as well as certain rations - IMHO one of the more important ones is the free cash flows. And the other is the net asset valuation: market capitalisation. And, even then, you have to be careful, because how are the company's assets valued - historical or current , and if current, how is that valuation arrived at.

 

 

In reality, for most shares people know of, buying and selling is easy and there is a liquid market.

[old man emu]

16 minutes ago, Jerry_Atrick said:

Valuation and wealth deserve a topic on their own.

Jerry,

In simple terms, if the market crashed, would Musk still be the richest person? How much of his wealth would represent things that he could say that he owns outright?

[Jerry_Atrick]

Dependas on the crash.. if it was more or less uniifrom across the board, then probably as the outstandig value of shares is usually the biggest "permanent" asset on earth -it would be very rare someone has all their money in cash. Although Berkshire Hathawa has been hoarding the stuff for a while. If it were a sector crash, such as tech, then no, but that wouldn't mean his is no longer a very wealthy fellow. And while you can look ata point in time, as long as he has no covenants requiring him to top up cash, say for some debt or margin, then he only has to hold onto those shares typically for about 6 - 12 months after a crash and he will be wealther than at the time of the crash.

 

At the least, he owns outright the proportion of Tesla assets correlating to the proportion of shares he owns in Tesla and through any options he currently holds, even though they have not vested yet (you can guarantee their strike price is slo low, he will exercise them - f he doesn't, then Telsa is probably worthless at that time), and don't forget, SpaceX and Starlink are private companies and not traded on the stock exchange - so he owns the assets of those companies in propoption to the shares he holds in them, too.

 

Assets includes estimated future cash flows, and importantly, estimated future profits; that is what guides a company's valuation.

Edited 1 hour ago by Jerry_Atrick