Business

Elon Musk becomes the first person to lose $200 billion

Elon Musk becomes the first person to lose $200 billion
Written by admin

By Brian Chappatta

Elon Musk became the second person to ever amass a personal fortune of more than $200 billion, crossing that threshold in January 2021, months after Jeff Bezos.

Tesla Inc’s chief executive officer has now achieved a first for himself: he became the only person in history to wipe $200 billion from their net worth.

Musk, 51, has seen his wealth plummet to $137 billion, according to the Bloomberg Billionaires Index, after Tesla shares fell in recent weeks, including an 11 percent drop on Tuesday. His fortune peaked at $340 billion on November 4, 2021, and he remained the richest person in the world until he was overtaken this month by Bernard Arnault, the French tycoon behind luxury goods conglomerate LVMH.

The round milestone reflects how high Musk has soared during the surge in asset prices during the easy money pandemic era. Tesla surpassed a $1 trillion market cap for the first time in October 2021, joining ubiquitous tech companies Apple Inc, Microsoft Corp, Amazon.com Inc, and Google parent Alphabet Inc, although its electric vehicles represent only a fraction of the total make up the car market.

Also Read | Between new rivals and a distracted boss, Tesla suffers on Wall Street

Now Tesla’s dominance in electric cars, the basis of its high valuation, is in jeopardy as the competition catches up. It’s offering US consumers a rare $7,500 rebate to get its two highest-selling models before the end of the year, while also reportedly reducing production at its Shanghai plant.

Meanwhile, Musk has been busy with Twitter amid mounting pressure on Tesla, which he acquired for $44 billion in late October. He used a “move-fast-and-break-things” approach, e.g. B. firing employees and then asking them to come back, and arbitrarily applying content policies to justify banning the accounts of some prominent journalists covering him.

The fall in Tesla stock has been so severe — shares fell 65 percent in 2022 — and Musk has sold so much this year to cover his Twitter purchase that they’re no longer his biggest asset, according to Bloomberg’s wealth index are. Musk’s stake in his tightly held Space Exploration Technologies Corp. exceeds his roughly $44 billion position in Tesla stock at $44.8 billion (he still has an estimated $27.8 billion in options). Musk now owns 42.2 percent of SpaceX, according to a recent filing.

For his part, Musk has dismissed concerns about Tesla and has repeatedly taken to Twitter to criticize the Federal Reserve for raising interest rates at the fastest pace in a generation.

“Tesla works better than ever!” Musk tweeted on Dec. 16. “We don’t control the Federal Reserve. That’s the real problem here.”

However, the billionaire, who previously borrowed heavily for his stake in Tesla, also recently warned of the dangers of borrowing money in panicked markets.

“I would really advise people not to have margin debt in a volatile stock market, and you know, from a cash standpoint, you should keep the powder dry,” Musk said in the All-In podcast released this month . “Some pretty extreme things can happen in a declining market.”

About the author

admin

Leave a Comment