October 14, 2019 • 49 mins
One of the questions Bethany has obsessed over in her years of covering big business is this: "What is the line between a visionary and a fraudster?" If any piece of Elon Musk's current empire (Tesla, SpaceX, The Boring Company, etc) works in the long term, he’ll go down in the history books as a visionary. But will the problems he has created, and Tesla’s desperate need for cash, catch up with him? And is the way that his critics are treated, whether with his explicit or implicit consent, a clue to how this might turn out? Or is it irrelevant? To discuss, Bethany sits down with Linette Lopez, a reporter from Business Insider, who has had her own run-ins with Musk and his followers.
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Episode Transcript
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Speaker 1 (00:01):
Thanks for downloading Making a Killing. I'm Bethany McClain. We've
had some amazingly fun conversations so far in this series,
but other shows that are really fun is when my
interview collides with a topic I've written about for Vanity Fair,
and this upcoming episode will feature Lynette Lopez talking about Tesla.
In modern English, the term cult has usually been used
(00:24):
in reference to a social group that is defined by
its unusual, religious, spiritual, or philosophical beliefs, or by its
common interest in a particular personality, object or goal. So
that's how Wikipedia answers the question what is a cult?
I was thinking about that because, well, because I'm thinking
(00:45):
about Elon Musk, who isn't a Tesla and the rest
of Elon's empire. I recently finished a piece for Vanity
Fair about Solar City, which was a mostly forgotten piece
of the puzzle until recently. Back to them anyway. The
headline of the piece was He's full of s blank
blank blank, How Elon Musk fooled investors, built taxpayers, and
(01:10):
gambled Tesla to save Solar City. I guess my point
of view is pretty clear. Criticizing Musk is an interesting exercise,
because Musk, who is going to save the planet with
solar energy, self driving electric vehicles, artificial intelligence, and if
all else fails, a way to get to Mars, is
in many ways the leader of a cult. Let's call
(01:31):
it the Muscuans. Musk is their leader, their icon, or,
as one put it on Twitter, the most genius man alive.
During the course of my reporting, I learned about another group,
a group called Tesla Q Tesla stock symbol followed by
the queue that stocks pickup when they are delisted due
to bankruptcy. Obviously, these are not Muscians, these are skeptics,
(01:55):
and the battleground between the believers, the Muscians and the
skeptics is Twitter. Of course, as is the case with
any cult. To the believers, it's Tesla C that is
the real enemy. And so the dark side of fintwit,
which is what people call financial Twitter, is that cult
members target people, particularly female journalists, who dare to write
(02:17):
or say anything negative about their leader. As listeners of
this podcast know, one of the questions I'm obsessed with
is what is the line between a visionary and a fraud.
I don't have a view on the rest of Elon's
empire beyond Solar City. The one thing I do know
is that if any piece of it works, Elon Musk
will go down in the history books as a visionary.
(02:39):
But will the problems he has created and Tesla's desperate
need for cash catch up with him? And is the
way his critics are treated, whether with his explicit or
implicit consent, a clue to how all of this might
turn out. My guest today is Lynette Lopez, who has
been covering Musk fearlessly and skeptically for Business Insider for
several years. A year ago, after she wrote a particularly
(03:02):
skeptical story, the Muskins came after her, so she's also
experienced the dark side of fintwit. I'm curious as to
her views on his empire, but also her experience with
the cult and what, in her view it all means. Selenette,
your pin tweet is pretty astonishing. It's from about a
year or so ago, and it's I'd just like to
point out that right now, right at this very moment,
(03:25):
at Elon Musk is going through my Facebook history and
screen tell us about that. So Elon Musk doesn't engage
on Twitter like most CEOs or adults. He targets people
who don't have nearly the following that he has. He
(03:45):
relies on information that he gets from his Twitter followers,
who are as you might call them, members of his cult.
And his very rapid response to that tweet was, I'm
not grabbing from your Facebook profile. Someone is sending me
pictures and that's what I'm seeing. That is not the
(04:09):
response of a normal adult, let alone a normal CEO,
let alone a normal CEO. So, regardless of what you
think about Elon Musk, let's establish right now that he
is not normal. And that's a really good starting point.
Not normal, and no interaction that you will have with
(04:32):
him or his company will be normal. The entire thing
runs as an appendage to his body and brain and
heart because he's a very emotional man. So you have
to think about every single person who interacts with you
from Tesla as an agent of Musk. So they're all
(04:57):
just appendages, appendages, and that they are that way because
they're afraid. They're afraid of losing their jobs, they're afraid
of incurring his wrath, as members of the cult are
afraid of their fearless leader, right exactly exactly, So what
was it that led to this. What was it that
caused Elon Musk? If causes the right word, as if
there's some linearity about this? What caused Elon Musk's followers
(05:20):
to start going through your Facebook? Well it's a little
bit complicated and has resulted in a lawsuit against a
man named Martin Tripp, who is a former Tesla employee. Ye,
a whistle blower, right, yes, he is a whistle blower.
He approached me in May of twenty eighteen with documents
that proved that Tesla was just generating an unbelievable amount
(05:44):
of scrap in order to build the Model three. And
what does it mean that they were generating a lot
of scrap, that they were wasting a lot. Yes, roughly,
it meant that for every two cars Tesla was making,
it would throw away a third of a car. Oh,
that's stunning, stun stuff. And is there a sense what's
normal in the Is some scrap normal? In the an
automobile manufacturing, some scrap is normal. But that was it
(06:08):
blew the Detroit guys away. Okay, that level blew anybody
who had any experience in automotive away. But one thing
I will note that is that a lot of Tesla
employees do not have a lot of experience in automotive,
but those that did would speak to me in kind
of hush tones. I remember I spoke to one guy.
He was the manager of the line in Fremont that
(06:30):
manufactured the doors on the Model three, and I asked him,
you know, so what's your fail rate? And he kind
of just mumbled percent and I was like what, Like
I thought he was going to say like point three
percent or something like that. It was fifteen percent. Wow. Yeah,
and again is standard something approaching five percent zero percent?
(06:52):
It's something between I would say one in three. Okay,
So this is a huge number. This is a huge
and one that makes it really hard for test let
make money, which is already the problem, right because I
would assume that the more you're wasting, the harder it
is to actually turn a profit. Right. Yes, And you
have to also remember that it Tesla, nothing is final.
Everything is always in flux and also subject to the
(07:15):
whim of Elon Musk. So if a car look ridiculous
or become too complicated with butterfly doors, doesn't matter. If
Elon wants the butterfly doors, you're getting. Butterfly doors come
hell or high water. So Martin Tripp came to you
and with the stunning number about the waste. Okay, yes,
stunning number, he started leaking all sorts of information about
(07:38):
what was going on inside of Tesla because he was
very concerned. He joined Tesla because he wanted to save
the earth. He was a huge Musk fan when he
joined up, and it took several months for the company
to kind of wear him down to the point that
he was overworked, depressed, and felt like he really wasn't
(07:59):
get the whole story about what Tesla was about. So
he wanted to be a Muscan, but he was then
refold very much wanted to be a Muscan. And after
having spoken with dozens of Tesla employees, former, current, etc.
It's a familiar story. They go in, they have a
high opinion of Elon Musk, and they come out of
there just stunned at how just massive the chaos is
(08:26):
inside of the company. So the trip was eventually found.
Musk hired a third party service to hunt him down
and they used a detail in one of my stories
and corroborated with his searches inside the company's database, and
they found him. They sued him and they thought that
(08:48):
would probably shut me up, but no. So that was
in June of last year, and around July, after having
collected other sources around the company, I published a story
that said, in order to factory gait, which is a
Tesla term, so get five thousand cars finished at the
(09:10):
end of the factory lines. It's what they had a
goal of factory getting five thousand cars. To get to
that number, they stopped doing this test called the brake
and roll test, which is a test that tests the
car at different rotations per minute the wheels. You connect
the car to a computer, the wheel starts spinning, and
(09:32):
the computer tells you how the alignment's going, what the
car's doing, how it's reacting to difference. And it's a
standard test and an important test standard tests. Nobody I
talk to anywhere in the world of automaking could tell
me why anyone would stop doing I mean, the idea
of it not being done was just like, I mean,
(09:52):
there's no rule, but you know a little bit like
putting a pharmaceutical product out without quality control exactly, there's
no cool But who would do that was kind of
the reaction. So I published the story and I don't know,
the stock fell might have been just light trading Day
was around the July fourth holiday that tends to get
(10:14):
Elon's attention, though, and a few days later he was
tweeting at me basically suggesting that I was being paid
by short sellers to write negative articles about Tesla, which
is always the favorite response to any immature CEO who
is targeted, right who has anything skeptical said about him,
(10:35):
which is that it must be the short sellers paying
the journalist, rather than maybe there's some legitimate criticism here.
Maybe journalism is a job that we do and we
get paid for, and maybe it's something different than being
a syncophan for the company. Right. I have student loans.
I got to pay my bills. Unfortunately, these short sellers
aren't out here paying like that. But they're not. They're
(10:56):
just not. They don't do it. I've never experienced any
short seller in my life to establish that. Actually, I've
been doing this for twenty five years. I've never had
someone offered to pay me. No, never, they don't do that.
So Elon went on and on and on for what
felt like two days, just like tweeting out screenshots from
(11:20):
my Facebook profile. As you pointed, out and speculating, and
then of course his twenty two million followers start speculating,
and everyone's speculating. So now I have this really angry
mob following me everywhere I go on Twitter, making fake
accounts that purport to be me. Yeah, and you can
(11:41):
complain to Twitter about this, but then they say that
you are a public figure. So if people are making
dummy accounts, like, what are you going to do? I
have twenty two thousand followers. I am heartily a public figure, right,
but you know, Okay, So just in case you're wondering,
if you're ever bullied on Twitter, don't expect any help.
(12:01):
That's a whole other Staddy Jack and and so that's that.
I mean, that's been my relationship with Tesla ever since.
Unless I have a really really good scoop, they don't
respond to my questions, they don't engage with me. And
I guess that's fine because that establishes the nature of
our relationship. I don't have to pretend to be nice.
(12:21):
I'm not nice, very adult response just to ignore the
journalists who just ignore me question. So since we're not
going to play nice, that's fine. I know how to
do that. I know how to play me. You have
a line after your pin tweet which is great, which
says you go on to say, if you're investing or
Tesla or in a Tesla, you need to sit with that.
Why do you think it's relevant how Musk treats you
(12:44):
and treats other people. How the Muskians, not just Musk,
treat people who ask questions they don't like. It just
reminds me of Cicero. He said, to be, not to
seem yep, and Elon is really focused on seeming and
less focused on being, and you really need to consider
why that is. That's why you need to know your philosophers.
(13:06):
That's got to know you fast. Because let's back up
and go back to I think the first piece you
wrote about Tesla may not be for Business Insider. It
was Sam z Allen Teaboon Pickens criticizing Tesla, and Sam's
all was critical because of the government subsidies that Tesla
was getting. But you also noticed both of them said
he might be the smartest man in the world, the
best dealmaker, and the best salesman. This was hardly a
(13:29):
full on critical piece, right. What was your mindset at
that point? At that point, I mean I was that
had to be twenty fifteen, twenty sixteen. I think I
was just at a conference watching these two guys talk
about Tesla. Look, Sam's Allen Teboon, Pickens Rip Teaboon. They
were both very, very, very successful men. But they are
(13:51):
Rip Teaboon, Yes, very nice man of metals several occasions.
But Old, oh my god, Old, and you know is
not known for his kindness or charming personality. I know,
he's known for being a battle axe. So as a
young person, it's always fun to watch the boomers freak
(14:12):
out about new things. Yeah, and I had no feeling
about whether Tesla should or should not succeed at that point.
It was just interesting to listen to them those statements
from the two of them. He might be the smartest
man in the world, the best dealmaker, the best salesman.
At that time, there was pretty much unqualified adulation surrounding Musk. Right,
(14:32):
Is that a fair summary? That's a fair summary. I
think I don't think people everybody really understood the Solar
City deal at that point, right. I think people were
just seeing that he had created the first American car
company in a hundred years. It seemed to have some success,
and he had his hair plugs by then he was
looking like a billionaire player. There's something in CEOs needing
(14:53):
to redo their hair right. That has happened more than once,
and it has not been a good sign. Yeah, no, no, okay.
I get that he had created the first new American
car company and over a century. It is astounding. But
why do you think he is such a cult figure.
Why does he have his army of muscans? Is there
more to it than that? I think he makes He
makes a certain kind of person feel powerful. He makes
(15:16):
a certain kind of man, especially, feel like they can innovate,
they can have power over the world that they see
around them, and they can use their minds to affect
change because they're riding on his coattails. They're riding on
his coattails and they can learn from him. So whenever
(15:39):
somebody gets this like kind of hero complex, it's always
useful to dig deeper. That's it's such a good point
that you make. I remember I did a skeptical piece
about Valiant. You remember, of course, Valiant, the high flying
drug company, And I remember one skeptical investor saying to me,
whenever people start to refer to the CEO by his
(16:00):
first name, because everybody called him Mike, not Mike Pearson,
but Mike. But when people start to refer to the
CEO by his first name, watch out. That's not an investment,
it's a cult. And so per your point, exactly right.
Is there another layer to it too in this that
makes the Muscians sort of more extreme, which is this
layer of self righteousness surrounding it, that somehow if you're
(16:21):
against him, you're you're a climate change denier. If you're
against him, you want to see the Earth go down
in flames. Does that add to it as well? Of
course the self righteousness is a huge part of it.
And somebody brought to my attention that inside of the
Tesla Facebook group, but Tesla Owners Facebook group, they were speculating.
They're like, well, isn't she a climate change denier? Why
(16:43):
is she against Tesla? How is she for the climate
and against Tesla? Can't be these two things? Cannot understand
And I can explain it for you, but I can't
understand it for you. Tesla Owners Club. Yeah, that's all
I have to say about it. I thought this also.
I don't think this was you. It was another female critic,
One of the Muscians wrote, how about you shut the
hell up and stop bothering Elon. Every minute that you
(17:05):
cause trouble is a minute that fully autonomous vehicle sick
is late to market. You're literally killing people as if
somehow any criticism of Elon Musk is delaying the advent
of autonomous vehicles. And I can't quite trace the logic
of that, can you? No? I can't. And it's almost
as if they think that Elon himself is in the
(17:27):
trenches figuring out autonomous vehicles. No, he has a team
that does that, a team that is breaking apart, and
you know, probably has what I like to think of
as the eye of Mordor, which is his full intention
on them, and that why they're breaking apart. Whenever Elon
focuses on a specific part of the business, it does
(17:50):
tend to fracture. It is. It's a lot of really,
it really is. I know, my Lord of the rings,
good good that prepared you for this job. And so
I will admit I'm not well sourced in the autonomous
on the autonomous team, but I do follow the reporting
and the exits. Yep. I also thought it was fascinating
(18:10):
the whole idea that criticism about this is even the
notion that criticism about this is distracting Musk from his
task means that Musk is paying attention to the criticism right,
which is back to our point originally that not many
CEOs invest this amount of their very limited time in
attacking their critics for a reason. They've got a job
(18:30):
to do. It's almost like he thinks he's the president
of the United States or something. There's another piece he
wrote in the sumber of twenty eighteen where you spoke
with I think forty two Tesla employees and they talked
actually explicitly about the cult of Elon Musk And what
did you hear from them? Well, first of all, do
not fire nine percent of your workforce while you're in
(18:55):
the middle of a massive project, because they will talk
so And was it because he'd hired the wrong people
to begin with, or just because he has a temper
and just fires people on a whim. Trim the fat
running out of money. This was during the Model three ramp,
so I imagine that they were burning through a lot
of cash and they needed to trim the fat as
(19:15):
an organization. Before we come back to that just pause
and explain to listeners why the Model three and the
Model three ramp were so important. What was this supposed
to do? So? Elon Musk has said that Tesla has
had a master plan for years now, and the plan
was to start with luxury vehicles, the Roadster being first,
then the S and the X, and then move on
(19:35):
to a mass market vehicle that would become like the
Toyota Camera of electric cars. Everyone could afford it, they
would mass produce it, and it would completely change the
game of automotive. Of course, the challenge there would be
making margins thick enough to sustain the manufacturing of this
car and mass and so in order to do that,
(19:58):
Elon Musk had to keep the price down, can't keep
the price of the car affordable, and try not to
blow as much money as he had in the past
on past models. He failed to do that, and last
summer we watched that happen, and the margins on the
Model three are not where they should be. I don't
I don't think they're above twenty percent. Yet he has
(20:20):
not sold as many cars as projected, and right now,
you know, it looks like there's no real plan to
get out of a financial the financial hole that the
company is in now because the Model three was not
a success. This goes back to the question of why
Musk is such a cult, or at least it's linked
to it. But why, at least to this point, arguably
(20:44):
to this point, has this not mattered. Why have the
capital markets still been willing to give Musk billions of
dollars two point seven billion dollars only last spring, despite
the fact that it was easy to see that promises
like this weren't coming together. Girl, they were about to
sell us we work at fifty billion. I guess that
says it all right, said no, we work, We don't
(21:07):
work billion. It don't work right. I think that as
long as bankers recognize that there is an appetite for
the story, they will sell you whatever. And Musk has
had the story. He Musk is a great story. He's
still a great story. I think people are starting to
understand him better and that is hurting him. But He's
(21:29):
been a story you could sell for years now, and
Wall Street loves that. People don't understand that Wall Street
is making its percent and it doesn't mean because they're
selling stock and bonds for companies that they believe in
those companies. Quite the contrary, right, it can be the
ultimate exercise in cynicism. No, and the terms of Tesla's
last capital raise weren't that. In fact, Wall Street made
(21:51):
out like a bandit and congratulations, guys, you did it again.
Back to the Model three. How big a deal is
the failure of the Model three? I think it could
sink the company if they don't figure out what story
they're selling next. It is not hard for Elon Musk
to blow through two billion dollars. He does that. He
(22:12):
does that pretty routinely, right, like every year, every quarter,
every year. It's two billion, two and a half billion,
three billion dollars. So the last capital raise wild did
provide some kind of cushion, is not enough to sustain
the company for any significant amount of time if there
is not some kind of profit made. And the losses
(22:34):
that Tesla has generated throughout its existence have completely canceled
out any profits that it has made over the three
or four quarters that has actually been profitable. I mean,
they basically might as well not have even happened. And
Tesla's in a lot of debt, so it needs cash
on hand. And this is a very very very expensive
business that it's in. And that's another promise Musk has blown. Right,
(22:57):
was the promise earlier this year, at the end of
last ye that Tesla was now going to be profitable
going forward. Right, Not so much. Yeah, he did, he
did say that. But it doesn't actually matter. If you
remind people what Elon Musk said wants is if perhaps
part of the old version of tell a really big
line and you can get away with it, it's small
eyes that will kill you, and perhaps that this is
(23:19):
a version of it, and that if you lie constantly
all the time, always, then it no longer matters because
people just stop keeping track of it. And yeah, they
stop keeping track, they stop taking you certain things you
say seriously. They're like, oh, it's Elon, And then you
start thinking, well, what should the markets take seriously about
what this person says? Right? And when does that dispensation
(23:42):
he has that special dispensation to say anything without consequences,
When does that go away? Good question. I have no
idea if yet to see it. But the SEC has
had issues with him saying things that were not true
or handing out material non public information at the wrong time.
He is very good at marshaling his own media, which
(24:06):
there are gro electric car blogs. They're huge fanboys of his.
There's one guy at Electric he said one semi critical
thing on Twitter once and the Tesla people just destroyed him,
as if he had not been sweet to Elon for years.
He says one semi critical thing, and it was like
(24:27):
watching a puppy get kicked in the face. It was
so brutal. I was like, but he loves you. But
that's why cults work, right, must Ardent believers are never
supposed to step out of line. So on this note
of the special dispensation that Musk has, why does he
seem to have it on the regulatory front, both with
the very minor slap on the risk from the Securities
Exchange Commission over the funding secured tweet, which was outright
(24:51):
stock manipulation, wasn't it Today where you can argue his
company is making claims, carefully worded claims it about autonomous
driving technology that is that could actually be quite dangerous,
and yet no one in the regulatory apparatus seems to
be willing to do much about this. Why why does
that special dispensation extend to our regulators? So I don't
(25:14):
necessarily know, but I will tell a story. I don't
know if you were at CNBC's Delivering Alpha last week
when the SEC Commissioner was speaking, and one thing that
he talked about was how we really need to get
mom and pop invested in these opaque private companies before
(25:34):
they get to market, because you know, we're not letting
them share it. Not the well that he did not see,
Oh yes he did. So that's who we're dealing with.
Imagine mom and pop getting into we work before this
situation had happened, before the IPO collapse, and everything at
the fifty billion dollar valuation than whatever valuations were believable
(26:00):
to me. And this is who we're dealing with running
the SEC. So I don't know why Elon Musk gets
a special dispensation, but actually maybe it's not that special.
Maybe it's not that special anymore. You're right, there's there's
a hands off attitude, and you can argue the regulatory
pendulum swings too far at certain points to each end,
and it's probably too far at the certain end. It
(26:23):
is right. That is actually stunning. Yeah, So backing up again,
as I'm sure you know, tesla Q members talk about
this moment a lot of them have had where they've
believed in Musk or not really been paying much attention
to the story, but they thought, wow, well Elon Musk
is a genius, and then he strayed into their field
and said something about something they know intimately. And Tesla
(26:45):
Charts the guy, a guy who goes on Twitter by
the handle Tesla Charts, who has a PhD and knows
a fair amount about solar roofs has a story about
thinking Yon Musk was a genius and then listening to
Musk do his solar roof pitch in the fall of
twenty fifteen and saying this is made up. It doesn't
it doesn't work this way. Then then people often discover,
through the community of Tesla skeptics on Twitter that somebody
(27:08):
else who knows something about another corner of the empire
also thinks it is it is full of bs. Do
you have these moments, big moments for you where you said, oh, wow,
this is really scary or is it? How is it
more for you? Ben just sort of a compendium of
small things. So the Solar City deal, that company was
obviously dog do do Yeah. Great headline on the Solar
(27:32):
City deal wait, I have it. Let me see if
I can find it. You when the deal was announced,
the title of your piece was Elon Musk just kicked
his shareholders in the teeth. Yeah. I don't know anything
about solar roofs. I don't know anything about cars. I
actually haven't driven since the Bush administration. That's awesome. I'm
so jealous. I hate driving with you. I hate driving too,
(27:53):
so in a lot of ways, I think that's helped
me because I'm not impressed by the feeling of a
Tesla or the look of a Tesla. To me, it
looks like a camera. It looks like any other car.
I don't care. That's actually a really interesting point that
has something to do. I don't think cars are sexy.
I don't care. But for me, I do know what
a deal should look like. I do know what a
(28:15):
crappy company on the vertiage of bankruptcy looks like. And
that was Solar City. And I do know what saddling
a somewhat healthy company growth stock with millions and millions
and millions and millions of dollars debt. I know what
that looks like. And it looks like crap. And that's
what that deal was after that I started paying attention
(28:35):
a little more, and all these people were talking about
Elon and engaging with his ideas and engaging with his
vision of the future as if they were somehow part
of it. He's great at making you feel that way.
But every other thing that I was hearing about Tesla
in the spring of twenty eighteen, even before I spoke
(28:59):
to Martin Tripp, was a very clear sign, frankly, that
Elon Musk doesn't care about you. It was at that
time that Reveal was doing its investigative work on the
working conditions inside of Tesla, which are not great. It
was at that time that Elon had just flipped out
on some investment banker who was asking normal, rational questions
(29:22):
about the company, and he was like, I don't want
any boring, bone headed questions, and he went to I mean,
it was just issue after issue where I was wishing
that was perfectly analogous to Jeff Skilling, the former CEO
of ven Ron, once calling an investor an asshole. Ye. Yes,
back to that issue after issue, the issue after issue
in which it was very clear, I mean, there were
Tesla fires. It was just very clear that Ian pause
(29:45):
on Tesla fires. You mean cars just spontaneously, spontaneously combusting
with little to no explanation. And by little to no,
I mean no no explanation. You cannot pretend like you
give a crap about the future if you are not
willing to answer questions, you are not willing to clarify
the issues that you have with your technology, and you
(30:06):
are not willing to treat your workers like human beings.
Elon Musk doesn't care about you. He doesn't care about stockholders.
You don't want volatility. He doesn't care about his customers
and whether or not they're getting into cars that have
defects or safety issues. He doesn't care. And that has
been made clear to me as I've been watching these
(30:30):
cars roll off the lot and into the hands of customers.
Some people are very happy, but there's always this you know,
my car is great, butt X, or my car is
amazing the right butt X and the butt X is
kind of swept under the rug because they love the
mission and they love what they think that Elon Musk
(30:51):
is doing for the world. And Elon Musk, I'm sorry
to say, is not doing this for the world. He's
doing this for Elon Musk. So that was your moment
of cognitive dissonance when you said, oh wait, this thing
back to your sister. A quote is not about what
it is. It's about what it's trying to seem to be.
It is what Elon Musk wants you to think about
Elon Musk. It is not about what Elon Musk is.
(31:14):
Before we come back to other things, pause on this
issue of the fires. You would think, in a rational world,
at least I would think that would be a pretty
simple one way story. Right, things are bursting into flame.
This isn't good. But the Muskians say that the press
is making too much of this, that this stuff just happens,
and that this is yet another example I guess of
the cabal against Musk that we even dare to ask
(31:37):
questions about car spontaneously exploding? Right? Is that a good summary?
That is accurate? It is insane, but it's accurate. You know.
I wrote a story about this kind of calculating really
how many combustible engine cars should spontaneously combust if they
were too equal the percentage of Tesla's that's spontaneously combust
and the numbers do not look good for Tesla. There
(32:00):
are a lot of reasons why the cars could be
spontaneously combusting, and they have to do with battery technology.
Tesla's batteries are actually a bunch of laptop batteries strung together,
and if one of the little cells explodes, whether it's
thermal runaway or there's some kind of defect inside of
the battery, one in a billion spontaneously combusting, as one
(32:23):
of my sources told me, which is quite possible in
this kind of battery technology. The rest of the cells
could also explode in what is called sympathetic detonation, and
that can cause a fire. So I've read fire reports
from people who I had a flat tire and I
want to change my tire, and as I was driving home,
(32:46):
my battery started smoking, possibly because of the impact of
the tire change, who knows, But Tesla really doesn't give
people explanations for that. You know, the battery is at
a certain point ruined, So how do you investigate the
root causes of that? And is that a contrast with
how the Big three would handle things? When I think
(33:06):
about not that they've been perfect by any means, but
when I think about GM's recalls, that seems to be
a little bit more of a concern for consumer safety.
Perhaps maybe I'm giving the Big Three too much credit.
I don't know, because I don't cover cars. I cover
the craziness of Tesla. I cut my teeth covering things
that I think are a little bit scammy. Yes, so
(33:29):
I don't. It's a good background to have, actually, because
once you've realized what scammy is, and you realize it exists,
and you realize the belief system that goes along with it,
it actually gives you a new lens to look at
the world. Right. Yes, and how easy scams are to perpetuate. Yes,
you don't get surprised anymore by how long anybody can
(33:49):
pull something off or how big it got. That doesn't
surprise me. Ever, it becomes almost a defense in some
ways because people think, well, it's gone on so long,
it can't possibly be a scam, or if it were
a scam, it would have blown up by now, And
all you have to do is have a little understanding
of history to say no, not at all. So back
to Solar City. One of the theories that I heard
(34:10):
the reason for the acquisition, and I was laughing when
you use the phrase sympathetic detonation, was that that's what
letting Solar City would go. Having let it go bankrupt
back then would have caused a sympathetic detonation and the
rest of Musk's empire because it would have cast out
on the mythology of Elon Musk, and so he needed
at all costs to prevent that from happening. But by
(34:32):
acquiring it, he's now perhaps the irony is the catch
twenty two is that he's now perhaps caused himself a
bigger problem. Were you surprised by any of the revelations
and the unsealed complaint that came out just recently. I
was surprised at how involved Musk was in the deal,
very hands on, very hands on, and I thought maybe
(34:56):
it was something that bankers handled, maybe it was something
that his cousin who were running Solar City handled, and
he was just like, show me where to sign on
the dotted line. I didn't realize that he himself was
the one calling the shots. He was the maestro, calling investors,
trying to persuade the ones that weren't on board to
do this, calling the bankers right, trying to raise cash
(35:18):
for Solar City. I found the most shocking part of it,
and we had known this, but just the way in
which he and his cousins had lent money to Solar
City before the acquisition via these solar bonds, and the
way in which they were so quickly repaid after the acquisition.
It was hundreds of millions of dollars. I mean, the
self dealing, and that the idea. I don't think there's
(35:41):
another CEO. There certainly aren't many CEOs who could get
away with that. No, and that's the board, that's shareholders.
They don't care apparently, I mean, that's the sec they
don't care. No one cares. So I guess we're just
going to be wringing our hands. I'm going to continue
to watch fake Lynette Twitter accounts. That's just the way
the world is. Now. Let's let's talk about that for
(36:02):
a little bit. Felix Samon, his credit gets laid, among
other things, wrote about the stalking of you. He wrote,
this is worse than just stalking. Musk is setting his
army a fanboys loose on Lopez. He's retweeting stuff they find,
and he's encouraging them every step of the way. Musk's
harassment of Lopez is obsessive and deranged. Why do you
(36:23):
think that is? Why do you think he has had
a problem with you and with female journalists in particular.
First of all, I don't think these guys really like
it when women to try to tell them what to do.
I've read about Elon's marriages and his relationships with women.
I am not a therapist, but it seems like he
is very insistent on being the alpha. Yeah. I think
(36:43):
it threatens his ego, it threatens his manhood that a
woman is coming after him, and I think he knows
that a lot of his followers have. You know, there
are a lot of them who are very, very very
anti anti woman. I've gotten some really really nasty emails
and nasty, nasty messages. I don't keep my dms open.
I'm no longer on Facebook, but I'm flattered by it.
(37:07):
And that's also why I tweeted out Mariah Carries, why
are you so obsessed with me? During this time? I
was done by some of this as I dug into it. Though.
Another journalist named Aaron Bieba, who criticized Musk, one of
the tweets that her was you criticized a man with
a cult following of twenty one million plus followers. You
should have seen it coming. You brought it on yourself again,
this sort of warped logic in which because Musk is
(37:30):
so famous and has so many followers, he somehow should
be beyond any kind of criticism. It's adorable. It's adorable.
That was not the word I thought was going to
come out of your mouth, because it's so pathetic, it's sad. Yeah,
he's not your dad. He doesn't need you to defend him.
He doesn't need you to defend him. He doesn't care
(37:51):
that you're defending him. He's taking his private jet from
one side of LA to the other. Honey, he doesn't
care about you, Okay. Isn't that amazing saying how some
people have that ability to convince other people though that
somehow they do care or there's something in it for
them too. That that quality that people have is just
endlessly fascinating to me, because visionaries have it and fraudsters
(38:14):
have it, right, and they both have it in spades,
and it makes it very difficult in the moment to
tell the difference between the two. Yes, it does. There
is a attention as a journalist in covering someone like Musk,
because you're supposed to be unbiased. When you cover anything,
you're supposed to approach it with an open mind and
(38:37):
just getting the facts. And at a certain point, though,
you start to understand what you're covering. And once you
start to understand it and you make a judgment about
what you're seeing in front of you, that's when people
can say, oh, you have a bias. Now you've injected
your bias. But is it bias or have you simply
done your job? I would argue the latter. I would
(38:59):
argue that it's by if a you start with a
predetermined point of view and you're trying to prove that
and that's why you come to have your point of view.
It's bias if you refuse to hear things that are
counter to your argument because you don't want you because
you don't want to hear them. And it's bias if
you have something at steak other than getting it right.
But the only thing we at journalists, as journalists have
(39:21):
at steak is being right. We don't want our stories
to look ridiculous a year from now, two years from now,
five years from now, ten years from now. We want
to look right. And if we have nothing more at stake,
then getting it right. Then, I actually think it is
a lack of courage not to take the information you've
learned and use it to make a point, particularly if
that point is running counter to the established narrative, because
(39:43):
then you're making people think. And if you can make
people think, isn't that one of the great points of life.
I've had a lot of delicious meals in my life,
but nothing is delicious as being right. Yet never eaten
anything better than that exactly right. And there's nothing more
distasteful than being wrong or shameful than being wrong. Right. Yeah,
So I mean in twenty thirteen, twenty fourteen, I was
(40:05):
like Elon Musk, Tesla, Megan Green Cars, everybody loves it great.
It really wasn't until I started understanding the company that
I was like, there is a dark side to this.
And I have not yet encountered anything, not from Tesla PR,
not from people inside of the company, even from people
who love the company, that has been able to show
(40:27):
me that I've gotten this all wrong. And and in fact,
my engagements with Tesla PR only make me more suspicious
of what the hell is going on in there? What
do you think do you worry about being wrong? Unlike
these guys on Wall Street. I don't have any money
behind this, so being right is all I've got. Right.
(40:49):
Is there anything you could hear that would change your mind?
Is there anything anybody could say or something you could
learn that would make you say that would make you
know how that happens? Sometimes where your perspective suddenly then
you see the same series of events through a different light.
Tesla would have to become profitable, yep. And the numbers
would have to work, right, number tesky little numbers, test
little numbers would have to work. And I would have
(41:12):
to start hearing from employees that they're being treated well, yeah,
and that the company cares about them. Oh, and from
customers that the cars are working properly. I start working.
To me, the compelling pieces of evidence that all is
not well at Tesla is the string of executive departures. Absolutely.
What do you hear about that? Working for Elon is
(41:34):
hard and you don't want the eye mortar, and after
a while you burn out, or you collect so many
secrets that you're just in So you either by the cult, yeah,
and you collect the secrets and you move up fast,
or you see what's going on, or Elon burns you
(41:57):
out and you leave. There are a lot of people
who love the challenge of working at a small organization,
like relatively small compared to the traditional at something that's
trying to change the world, something change the world, unique
engineering challenge, you know, very do it yourself sink or
swim culture. But ultimately it is nerve racking. I've had
(42:20):
sources whose entire families have turned on Musk because Daddy
has to go to the factory at six a hundred morning,
and he has to come home at night for dinner,
but then go back to the factory for maybe like
a skip level meeting or something at ten pm, and
then it starts a day all over again. Tesla is
(42:41):
a lifestyle, it's not just a job, so that lifestyle
can be toxic to some people. It's actually really interesting
because there's a great story from C. S. Lewis called
The Inner Circle the Inner Ring, and it's about how
compelling it is for most people once they get on
the inside, because we've all experienced what it is to
(43:01):
be on the outside, and once you're on the inside,
it's so compelling that you will basically do anything to
stay there because the allure is so so overwhelming. And
so when you see a company like Tesla where people
are being admitted to the inner circle and then leaving you,
there's something pretty astounding about that, right, most astounding was
his lawyer quitting. And yes, January was it. Yeah, after
(43:26):
he sent another tweet, his lawyer quit pretty much forty
eight maybe twenty four hours. It was so fast. And
changing horses in the middle of a lawsuit. Always having
different attorneys, that's always a red flag as well. And
Elon has a lot of different attorneys, Yes, that is
for sure. There are a lot of lawyers making fees.
(43:48):
Oh yeah, you know. I was thinking about this issue
of retaliation against critics, and I thought, to be fair,
we should point out it actually isn't only against women, right.
That's been the mob on Twitter. The Muscians on Twitter
seem to have directed a fair amount of their ire
toward women. But Elon has also fired this lawsuit against
ran Deep Hothy, the Tesla cue member who did a
(44:09):
lot of research into Musk. There's the Cave Diver episode
and the lawsuit against that, which is probably pretty well known.
Is crazy. I don't like bullies, and I think that
it is very suspect when someone with the power and
the money and the resources of Elon Musk goes after
(44:29):
a grad student like ran Deep, or a random diver
or a little journalist. I cannot imagine Elon ever suing
David Einhorn or Jim Chenos people with you're right. He
picks on people you're right. He picks on people who
he thinks doesn't don't have the means to fight back.
He would never sue. It's a really good point. He
would never see the Times, He's never gonna see the
(44:51):
journal He's never gonna see any of these publications. He
will only sue people who he thinks cannot beat him.
And that upsets me. That's such a good point it's
worth pointing out for listeners. What happened to this young
man named Randy Pathi who was sued by Tesla reportedly
for endangering employees. But when he got funded to actually
(45:14):
have a lawyer and said, well, Tesla, you need to
turn over the documents that show me doing this, in effect,
Tesla dropped the lawsuit. They just expected to be able
to destroy him because he wouldn't have the means to
fight back. And you're right, that's a very different picture
than going after people who can fight back, and I
can't fight back on the internet. I can't fight back
on Twitter, but he can't sue me. What would you
(45:36):
say if I were a big investor sitting here making
a decision whether or not, or I were somebody who
had the power to give Elon Musk half a billion dollars?
I don't. By the way, let's be clear if just
to say, let's pretend, why would you say this matters
about Musk's habit of bullying? Why is this an issue?
Because it means he's hiding something. It means that he
(45:58):
cannot handle any scrutiny at all. It means that he
is not willing to tolerate dissent or criticism of any kind.
And it means that he has time to swat at flies?
And how does he possibly have time to swat flies?
(46:19):
So a last question for you, how and when do
you think this plays out from where we sit today? Oh,
my lord, Jesus, be a biscuit and just stop me up.
I don't know, I don't know. I never heard that
phrase before. That's awesome. I don't know how this ends.
(46:40):
We don't have an sec we don't have regulators. We've
got compliant capital markets at least at least for maybe
not anymore. Maybe we work as a turning point. Maybe
maybe we work as a turning point. Maybe if we
don't have a million robotaxis on the ground by next spring,
as Elon promise last spring, or if they aren't a
(47:01):
thousand solar roofs being installed each week by the end
of this year, as Musk just said would be happening,
maybe that will be an issue for the markets. I
don't know. I don't consider the markets completely and totally efficient,
especially not now. I consider the markets a collective understanding
of how we feel in the present about the future,
(47:24):
not necessarily a smart understanding, isn't it Canes who said
the market can remain irrational longer than you can remain solved.
Absolutely so, I don't know where he's going to pull
out another moneymaker, though he doesn't seem to have the
cash to the revamp the smmecs, which are the two
models that actually make margin. I don't think that China
(47:46):
is going to be a huge success because we're seeing
the automarket there crater and electric vehicle manufacturers in China
are not doing well. So I don't know, but that said,
one lesson you've learned at least which will be true
until it's not. As don't count Elon Musk out right.
Oh no way, no way. I mean, if there's anything
(48:08):
I can say about Elon that is positive is that
he just won't go away. Yep. The guy's got incredible will,
He's got an incredible way will ye yeah, Iron, And
it's going to be really interesting to see how this
plays out. So thank you so much for taking the
time to talk to me. We'll stay in no doubt.
So that was fun. I expected Lynette to have strong opinions.
(48:32):
She's covered Musk from much longer and in much more
detail than I have, but I think she summed up
something we both realized. There is nothing about this that's normal.
My view is that maybe Musk will change the world,
maybe he'll get us to Mars, save the planet, rewire
our brains, but he'll do it despite his quirks, not
(48:53):
because of them, because there is nothing about his misrepresentations,
his failed promises, his treatment of him employees, and most
of all, his bullying that is good in any way
make you a killing
Thanks for downloading Making a Killing. I'm Bethany McClain. We've
had some amazingly fun conversations so far in this series,
but other shows that are really fun is when my
interview collides with a topic I've written about for Vanity Fair,
and this upcoming episode will feature Lynette Lopez talking about Tesla.
In modern English, the term cult has usually been used
(00:24):
in reference to a social group that is defined by
its unusual, religious, spiritual, or philosophical beliefs, or by its
common interest in a particular personality, object or goal. So
that's how Wikipedia answers the question what is a cult?
I was thinking about that because, well, because I'm thinking
(00:45):
about Elon Musk, who isn't a Tesla and the rest
of Elon's empire. I recently finished a piece for Vanity
Fair about Solar City, which was a mostly forgotten piece
of the puzzle until recently. Back to them anyway. The
headline of the piece was He's full of s blank
blank blank, How Elon Musk fooled investors, built taxpayers, and
(01:10):
gambled Tesla to save Solar City. I guess my point
of view is pretty clear. Criticizing Musk is an interesting exercise,
because Musk, who is going to save the planet with
solar energy, self driving electric vehicles, artificial intelligence, and if
all else fails, a way to get to Mars, is
in many ways the leader of a cult. Let's call
(01:31):
it the Muscuans. Musk is their leader, their icon, or,
as one put it on Twitter, the most genius man alive.
During the course of my reporting, I learned about another group,
a group called Tesla Q Tesla stock symbol followed by
the queue that stocks pickup when they are delisted due
to bankruptcy. Obviously, these are not Muscians, these are skeptics,
(01:55):
and the battleground between the believers, the Muscians and the
skeptics is Twitter. Of course, as is the case with
any cult. To the believers, it's Tesla C that is
the real enemy. And so the dark side of fintwit,
which is what people call financial Twitter, is that cult
members target people, particularly female journalists, who dare to write
(02:17):
or say anything negative about their leader. As listeners of
this podcast know, one of the questions I'm obsessed with
is what is the line between a visionary and a fraud.
I don't have a view on the rest of Elon's
empire beyond Solar City. The one thing I do know
is that if any piece of it works, Elon Musk
will go down in the history books as a visionary.
(02:39):
But will the problems he has created and Tesla's desperate
need for cash catch up with him? And is the
way his critics are treated, whether with his explicit or
implicit consent, a clue to how all of this might
turn out. My guest today is Lynette Lopez, who has
been covering Musk fearlessly and skeptically for Business Insider for
several years. A year ago, after she wrote a particularly
(03:02):
skeptical story, the Muskins came after her, so she's also
experienced the dark side of fintwit. I'm curious as to
her views on his empire, but also her experience with
the cult and what, in her view it all means. Selenette,
your pin tweet is pretty astonishing. It's from about a
year or so ago, and it's I'd just like to
point out that right now, right at this very moment,
(03:25):
at Elon Musk is going through my Facebook history and
screen tell us about that. So Elon Musk doesn't engage
on Twitter like most CEOs or adults. He targets people
who don't have nearly the following that he has. He
(03:45):
relies on information that he gets from his Twitter followers,
who are as you might call them, members of his cult.
And his very rapid response to that tweet was, I'm
not grabbing from your Facebook profile. Someone is sending me
pictures and that's what I'm seeing. That is not the
(04:09):
response of a normal adult, let alone a normal CEO,
let alone a normal CEO. So, regardless of what you
think about Elon Musk, let's establish right now that he
is not normal. And that's a really good starting point.
Not normal, and no interaction that you will have with
(04:32):
him or his company will be normal. The entire thing
runs as an appendage to his body and brain and
heart because he's a very emotional man. So you have
to think about every single person who interacts with you
from Tesla as an agent of Musk. So they're all
(04:57):
just appendages, appendages, and that they are that way because
they're afraid. They're afraid of losing their jobs, they're afraid
of incurring his wrath, as members of the cult are
afraid of their fearless leader, right exactly exactly, So what
was it that led to this. What was it that
caused Elon Musk? If causes the right word, as if
there's some linearity about this? What caused Elon Musk's followers
(05:20):
to start going through your Facebook? Well it's a little
bit complicated and has resulted in a lawsuit against a
man named Martin Tripp, who is a former Tesla employee. Ye,
a whistle blower, right, yes, he is a whistle blower.
He approached me in May of twenty eighteen with documents
that proved that Tesla was just generating an unbelievable amount
(05:44):
of scrap in order to build the Model three. And
what does it mean that they were generating a lot
of scrap, that they were wasting a lot. Yes, roughly,
it meant that for every two cars Tesla was making,
it would throw away a third of a car. Oh,
that's stunning, stun stuff. And is there a sense what's
normal in the Is some scrap normal? In the an
automobile manufacturing, some scrap is normal. But that was it
(06:08):
blew the Detroit guys away. Okay, that level blew anybody
who had any experience in automotive away. But one thing
I will note that is that a lot of Tesla
employees do not have a lot of experience in automotive,
but those that did would speak to me in kind
of hush tones. I remember I spoke to one guy.
He was the manager of the line in Fremont that
(06:30):
manufactured the doors on the Model three, and I asked him,
you know, so what's your fail rate? And he kind
of just mumbled percent and I was like what, Like
I thought he was going to say like point three
percent or something like that. It was fifteen percent. Wow. Yeah,
and again is standard something approaching five percent zero percent?
(06:52):
It's something between I would say one in three. Okay,
So this is a huge number. This is a huge
and one that makes it really hard for test let
make money, which is already the problem, right because I
would assume that the more you're wasting, the harder it
is to actually turn a profit. Right. Yes, And you
have to also remember that it Tesla, nothing is final.
Everything is always in flux and also subject to the
(07:15):
whim of Elon Musk. So if a car look ridiculous
or become too complicated with butterfly doors, doesn't matter. If
Elon wants the butterfly doors, you're getting. Butterfly doors come
hell or high water. So Martin Tripp came to you
and with the stunning number about the waste. Okay, yes,
stunning number, he started leaking all sorts of information about
(07:38):
what was going on inside of Tesla because he was
very concerned. He joined Tesla because he wanted to save
the earth. He was a huge Musk fan when he
joined up, and it took several months for the company
to kind of wear him down to the point that
he was overworked, depressed, and felt like he really wasn't
(07:59):
get the whole story about what Tesla was about. So
he wanted to be a Muscan, but he was then
refold very much wanted to be a Muscan. And after
having spoken with dozens of Tesla employees, former, current, etc.
It's a familiar story. They go in, they have a
high opinion of Elon Musk, and they come out of
there just stunned at how just massive the chaos is
(08:26):
inside of the company. So the trip was eventually found.
Musk hired a third party service to hunt him down
and they used a detail in one of my stories
and corroborated with his searches inside the company's database, and
they found him. They sued him and they thought that
(08:48):
would probably shut me up, but no. So that was
in June of last year, and around July, after having
collected other sources around the company, I published a story
that said, in order to factory gait, which is a
Tesla term, so get five thousand cars finished at the
(09:10):
end of the factory lines. It's what they had a
goal of factory getting five thousand cars. To get to
that number, they stopped doing this test called the brake
and roll test, which is a test that tests the
car at different rotations per minute the wheels. You connect
the car to a computer, the wheel starts spinning, and
(09:32):
the computer tells you how the alignment's going, what the
car's doing, how it's reacting to difference. And it's a
standard test and an important test standard tests. Nobody I
talk to anywhere in the world of automaking could tell
me why anyone would stop doing I mean, the idea
of it not being done was just like, I mean,
(09:52):
there's no rule, but you know a little bit like
putting a pharmaceutical product out without quality control exactly, there's
no cool But who would do that was kind of
the reaction. So I published the story and I don't know,
the stock fell might have been just light trading Day
was around the July fourth holiday that tends to get
(10:14):
Elon's attention, though, and a few days later he was
tweeting at me basically suggesting that I was being paid
by short sellers to write negative articles about Tesla, which
is always the favorite response to any immature CEO who
is targeted, right who has anything skeptical said about him,
(10:35):
which is that it must be the short sellers paying
the journalist, rather than maybe there's some legitimate criticism here.
Maybe journalism is a job that we do and we
get paid for, and maybe it's something different than being
a syncophan for the company. Right. I have student loans.
I got to pay my bills. Unfortunately, these short sellers
aren't out here paying like that. But they're not. They're
(10:56):
just not. They don't do it. I've never experienced any
short seller in my life to establish that. Actually, I've
been doing this for twenty five years. I've never had
someone offered to pay me. No, never, they don't do that.
So Elon went on and on and on for what
felt like two days, just like tweeting out screenshots from
(11:20):
my Facebook profile. As you pointed, out and speculating, and
then of course his twenty two million followers start speculating,
and everyone's speculating. So now I have this really angry
mob following me everywhere I go on Twitter, making fake
accounts that purport to be me. Yeah, and you can
(11:41):
complain to Twitter about this, but then they say that
you are a public figure. So if people are making
dummy accounts, like, what are you going to do? I
have twenty two thousand followers. I am heartily a public figure, right,
but you know, Okay, So just in case you're wondering,
if you're ever bullied on Twitter, don't expect any help.
(12:01):
That's a whole other Staddy Jack and and so that's that.
I mean, that's been my relationship with Tesla ever since.
Unless I have a really really good scoop, they don't
respond to my questions, they don't engage with me. And
I guess that's fine because that establishes the nature of
our relationship. I don't have to pretend to be nice.
(12:21):
I'm not nice, very adult response just to ignore the
journalists who just ignore me question. So since we're not
going to play nice, that's fine. I know how to
do that. I know how to play me. You have
a line after your pin tweet which is great, which
says you go on to say, if you're investing or
Tesla or in a Tesla, you need to sit with that.
Why do you think it's relevant how Musk treats you
(12:44):
and treats other people. How the Muskians, not just Musk,
treat people who ask questions they don't like. It just
reminds me of Cicero. He said, to be, not to
seem yep, and Elon is really focused on seeming and
less focused on being, and you really need to consider
why that is. That's why you need to know your philosophers.
(13:06):
That's got to know you fast. Because let's back up
and go back to I think the first piece you
wrote about Tesla may not be for Business Insider. It
was Sam z Allen Teaboon Pickens criticizing Tesla, and Sam's
all was critical because of the government subsidies that Tesla
was getting. But you also noticed both of them said
he might be the smartest man in the world, the
best dealmaker, and the best salesman. This was hardly a
(13:29):
full on critical piece, right. What was your mindset at
that point? At that point, I mean I was that
had to be twenty fifteen, twenty sixteen. I think I
was just at a conference watching these two guys talk
about Tesla. Look, Sam's Allen Teboon, Pickens Rip Teaboon. They
were both very, very, very successful men. But they are
(13:51):
Rip Teaboon, Yes, very nice man of metals several occasions.
But Old, oh my god, Old, and you know is
not known for his kindness or charming personality. I know,
he's known for being a battle axe. So as a
young person, it's always fun to watch the boomers freak
(14:12):
out about new things. Yeah, and I had no feeling
about whether Tesla should or should not succeed at that point.
It was just interesting to listen to them those statements
from the two of them. He might be the smartest
man in the world, the best dealmaker, the best salesman.
At that time, there was pretty much unqualified adulation surrounding Musk. Right,
(14:32):
Is that a fair summary? That's a fair summary. I
think I don't think people everybody really understood the Solar
City deal at that point, right. I think people were
just seeing that he had created the first American car
company in a hundred years. It seemed to have some success,
and he had his hair plugs by then he was
looking like a billionaire player. There's something in CEOs needing
(14:53):
to redo their hair right. That has happened more than once,
and it has not been a good sign. Yeah, no, no, okay.
I get that he had created the first new American
car company and over a century. It is astounding. But
why do you think he is such a cult figure.
Why does he have his army of muscans? Is there
more to it than that? I think he makes He
makes a certain kind of person feel powerful. He makes
(15:16):
a certain kind of man, especially, feel like they can innovate,
they can have power over the world that they see
around them, and they can use their minds to affect
change because they're riding on his coattails. They're riding on
his coattails and they can learn from him. So whenever
(15:39):
somebody gets this like kind of hero complex, it's always
useful to dig deeper. That's it's such a good point
that you make. I remember I did a skeptical piece
about Valiant. You remember, of course, Valiant, the high flying
drug company, And I remember one skeptical investor saying to me,
whenever people start to refer to the CEO by his
(16:00):
first name, because everybody called him Mike, not Mike Pearson,
but Mike. But when people start to refer to the
CEO by his first name, watch out. That's not an investment,
it's a cult. And so per your point, exactly right.
Is there another layer to it too in this that
makes the Muscians sort of more extreme, which is this
layer of self righteousness surrounding it, that somehow if you're
(16:21):
against him, you're you're a climate change denier. If you're
against him, you want to see the Earth go down
in flames. Does that add to it as well? Of
course the self righteousness is a huge part of it.
And somebody brought to my attention that inside of the
Tesla Facebook group, but Tesla Owners Facebook group, they were speculating.
They're like, well, isn't she a climate change denier? Why
(16:43):
is she against Tesla? How is she for the climate
and against Tesla? Can't be these two things? Cannot understand
And I can explain it for you, but I can't
understand it for you. Tesla Owners Club. Yeah, that's all
I have to say about it. I thought this also.
I don't think this was you. It was another female critic,
One of the Muscians wrote, how about you shut the
hell up and stop bothering Elon. Every minute that you
(17:05):
cause trouble is a minute that fully autonomous vehicle sick
is late to market. You're literally killing people as if
somehow any criticism of Elon Musk is delaying the advent
of autonomous vehicles. And I can't quite trace the logic
of that, can you? No? I can't. And it's almost
as if they think that Elon himself is in the
(17:27):
trenches figuring out autonomous vehicles. No, he has a team
that does that, a team that is breaking apart, and
you know, probably has what I like to think of
as the eye of Mordor, which is his full intention
on them, and that why they're breaking apart. Whenever Elon
focuses on a specific part of the business, it does
(17:50):
tend to fracture. It is. It's a lot of really,
it really is. I know, my Lord of the rings,
good good that prepared you for this job. And so
I will admit I'm not well sourced in the autonomous
on the autonomous team, but I do follow the reporting
and the exits. Yep. I also thought it was fascinating
(18:10):
the whole idea that criticism about this is even the
notion that criticism about this is distracting Musk from his
task means that Musk is paying attention to the criticism right,
which is back to our point originally that not many
CEOs invest this amount of their very limited time in
attacking their critics for a reason. They've got a job
(18:30):
to do. It's almost like he thinks he's the president
of the United States or something. There's another piece he
wrote in the sumber of twenty eighteen where you spoke
with I think forty two Tesla employees and they talked
actually explicitly about the cult of Elon Musk And what
did you hear from them? Well, first of all, do
not fire nine percent of your workforce while you're in
(18:55):
the middle of a massive project, because they will talk
so And was it because he'd hired the wrong people
to begin with, or just because he has a temper
and just fires people on a whim. Trim the fat
running out of money. This was during the Model three ramp,
so I imagine that they were burning through a lot
of cash and they needed to trim the fat as
(19:15):
an organization. Before we come back to that just pause
and explain to listeners why the Model three and the
Model three ramp were so important. What was this supposed
to do? So? Elon Musk has said that Tesla has
had a master plan for years now, and the plan
was to start with luxury vehicles, the Roadster being first,
then the S and the X, and then move on
(19:35):
to a mass market vehicle that would become like the
Toyota Camera of electric cars. Everyone could afford it, they
would mass produce it, and it would completely change the
game of automotive. Of course, the challenge there would be
making margins thick enough to sustain the manufacturing of this
car and mass and so in order to do that,
(19:58):
Elon Musk had to keep the price down, can't keep
the price of the car affordable, and try not to
blow as much money as he had in the past
on past models. He failed to do that, and last
summer we watched that happen, and the margins on the
Model three are not where they should be. I don't
I don't think they're above twenty percent. Yet he has
(20:20):
not sold as many cars as projected, and right now,
you know, it looks like there's no real plan to
get out of a financial the financial hole that the
company is in now because the Model three was not
a success. This goes back to the question of why
Musk is such a cult, or at least it's linked
to it. But why, at least to this point, arguably
(20:44):
to this point, has this not mattered. Why have the
capital markets still been willing to give Musk billions of
dollars two point seven billion dollars only last spring, despite
the fact that it was easy to see that promises
like this weren't coming together. Girl, they were about to
sell us we work at fifty billion. I guess that
says it all right, said no, we work, We don't
(21:07):
work billion. It don't work right. I think that as
long as bankers recognize that there is an appetite for
the story, they will sell you whatever. And Musk has
had the story. He Musk is a great story. He's
still a great story. I think people are starting to
understand him better and that is hurting him. But He's
(21:29):
been a story you could sell for years now, and
Wall Street loves that. People don't understand that Wall Street
is making its percent and it doesn't mean because they're
selling stock and bonds for companies that they believe in
those companies. Quite the contrary, right, it can be the
ultimate exercise in cynicism. No, and the terms of Tesla's
last capital raise weren't that. In fact, Wall Street made
(21:51):
out like a bandit and congratulations, guys, you did it again.
Back to the Model three. How big a deal is
the failure of the Model three? I think it could
sink the company if they don't figure out what story
they're selling next. It is not hard for Elon Musk
to blow through two billion dollars. He does that. He
(22:12):
does that pretty routinely, right, like every year, every quarter,
every year. It's two billion, two and a half billion,
three billion dollars. So the last capital raise wild did
provide some kind of cushion, is not enough to sustain
the company for any significant amount of time if there
is not some kind of profit made. And the losses
(22:34):
that Tesla has generated throughout its existence have completely canceled
out any profits that it has made over the three
or four quarters that has actually been profitable. I mean,
they basically might as well not have even happened. And
Tesla's in a lot of debt, so it needs cash
on hand. And this is a very very very expensive
business that it's in. And that's another promise Musk has blown. Right,
(22:57):
was the promise earlier this year, at the end of
last ye that Tesla was now going to be profitable
going forward. Right, Not so much. Yeah, he did, he
did say that. But it doesn't actually matter. If you
remind people what Elon Musk said wants is if perhaps
part of the old version of tell a really big
line and you can get away with it, it's small
eyes that will kill you, and perhaps that this is
(23:19):
a version of it, and that if you lie constantly
all the time, always, then it no longer matters because
people just stop keeping track of it. And yeah, they
stop keeping track, they stop taking you certain things you
say seriously. They're like, oh, it's Elon, And then you
start thinking, well, what should the markets take seriously about
what this person says? Right? And when does that dispensation
(23:42):
he has that special dispensation to say anything without consequences,
When does that go away? Good question. I have no
idea if yet to see it. But the SEC has
had issues with him saying things that were not true
or handing out material non public information at the wrong time.
He is very good at marshaling his own media, which
(24:06):
there are gro electric car blogs. They're huge fanboys of his.
There's one guy at Electric he said one semi critical
thing on Twitter once and the Tesla people just destroyed him,
as if he had not been sweet to Elon for years.
He says one semi critical thing, and it was like
(24:27):
watching a puppy get kicked in the face. It was
so brutal. I was like, but he loves you. But
that's why cults work, right, must Ardent believers are never
supposed to step out of line. So on this note
of the special dispensation that Musk has, why does he
seem to have it on the regulatory front, both with
the very minor slap on the risk from the Securities
Exchange Commission over the funding secured tweet, which was outright
(24:51):
stock manipulation, wasn't it Today where you can argue his
company is making claims, carefully worded claims it about autonomous
driving technology that is that could actually be quite dangerous,
and yet no one in the regulatory apparatus seems to
be willing to do much about this. Why why does
that special dispensation extend to our regulators? So I don't
(25:14):
necessarily know, but I will tell a story. I don't
know if you were at CNBC's Delivering Alpha last week
when the SEC Commissioner was speaking, and one thing that
he talked about was how we really need to get
mom and pop invested in these opaque private companies before
(25:34):
they get to market, because you know, we're not letting
them share it. Not the well that he did not see,
Oh yes he did. So that's who we're dealing with.
Imagine mom and pop getting into we work before this
situation had happened, before the IPO collapse, and everything at
the fifty billion dollar valuation than whatever valuations were believable
(26:00):
to me. And this is who we're dealing with running
the SEC. So I don't know why Elon Musk gets
a special dispensation, but actually maybe it's not that special.
Maybe it's not that special anymore. You're right, there's there's
a hands off attitude, and you can argue the regulatory
pendulum swings too far at certain points to each end,
and it's probably too far at the certain end. It
(26:23):
is right. That is actually stunning. Yeah, So backing up again,
as I'm sure you know, tesla Q members talk about
this moment a lot of them have had where they've
believed in Musk or not really been paying much attention
to the story, but they thought, wow, well Elon Musk
is a genius, and then he strayed into their field
and said something about something they know intimately. And Tesla
(26:45):
Charts the guy, a guy who goes on Twitter by
the handle Tesla Charts, who has a PhD and knows
a fair amount about solar roofs has a story about
thinking Yon Musk was a genius and then listening to
Musk do his solar roof pitch in the fall of
twenty fifteen and saying this is made up. It doesn't
it doesn't work this way. Then then people often discover,
through the community of Tesla skeptics on Twitter that somebody
(27:08):
else who knows something about another corner of the empire
also thinks it is it is full of bs. Do
you have these moments, big moments for you where you said, oh, wow,
this is really scary or is it? How is it
more for you? Ben just sort of a compendium of
small things. So the Solar City deal, that company was
obviously dog do do Yeah. Great headline on the Solar
(27:32):
City deal wait, I have it. Let me see if
I can find it. You when the deal was announced,
the title of your piece was Elon Musk just kicked
his shareholders in the teeth. Yeah. I don't know anything
about solar roofs. I don't know anything about cars. I
actually haven't driven since the Bush administration. That's awesome. I'm
so jealous. I hate driving with you. I hate driving too,
(27:53):
so in a lot of ways, I think that's helped
me because I'm not impressed by the feeling of a
Tesla or the look of a Tesla. To me, it
looks like a camera. It looks like any other car.
I don't care. That's actually a really interesting point that
has something to do. I don't think cars are sexy.
I don't care. But for me, I do know what
a deal should look like. I do know what a
(28:15):
crappy company on the vertiage of bankruptcy looks like. And
that was Solar City. And I do know what saddling
a somewhat healthy company growth stock with millions and millions
and millions and millions of dollars debt. I know what
that looks like. And it looks like crap. And that's
what that deal was after that I started paying attention
(28:35):
a little more, and all these people were talking about
Elon and engaging with his ideas and engaging with his
vision of the future as if they were somehow part
of it. He's great at making you feel that way.
But every other thing that I was hearing about Tesla
in the spring of twenty eighteen, even before I spoke
(28:59):
to Martin Tripp, was a very clear sign, frankly, that
Elon Musk doesn't care about you. It was at that
time that Reveal was doing its investigative work on the
working conditions inside of Tesla, which are not great. It
was at that time that Elon had just flipped out
on some investment banker who was asking normal, rational questions
(29:22):
about the company, and he was like, I don't want
any boring, bone headed questions, and he went to I mean,
it was just issue after issue where I was wishing
that was perfectly analogous to Jeff Skilling, the former CEO
of ven Ron, once calling an investor an asshole. Ye. Yes,
back to that issue after issue, the issue after issue
in which it was very clear, I mean, there were
Tesla fires. It was just very clear that Ian pause
(29:45):
on Tesla fires. You mean cars just spontaneously, spontaneously combusting
with little to no explanation. And by little to no,
I mean no no explanation. You cannot pretend like you
give a crap about the future if you are not
willing to answer questions, you are not willing to clarify
the issues that you have with your technology, and you
(30:06):
are not willing to treat your workers like human beings.
Elon Musk doesn't care about you. He doesn't care about stockholders.
You don't want volatility. He doesn't care about his customers
and whether or not they're getting into cars that have
defects or safety issues. He doesn't care. And that has
been made clear to me as I've been watching these
(30:30):
cars roll off the lot and into the hands of customers.
Some people are very happy, but there's always this you know,
my car is great, butt X, or my car is
amazing the right butt X and the butt X is
kind of swept under the rug because they love the
mission and they love what they think that Elon Musk
(30:51):
is doing for the world. And Elon Musk, I'm sorry
to say, is not doing this for the world. He's
doing this for Elon Musk. So that was your moment
of cognitive dissonance when you said, oh wait, this thing
back to your sister. A quote is not about what
it is. It's about what it's trying to seem to be.
It is what Elon Musk wants you to think about
Elon Musk. It is not about what Elon Musk is.
(31:14):
Before we come back to other things, pause on this
issue of the fires. You would think, in a rational world,
at least I would think that would be a pretty
simple one way story. Right, things are bursting into flame.
This isn't good. But the Muskians say that the press
is making too much of this, that this stuff just happens,
and that this is yet another example I guess of
the cabal against Musk that we even dare to ask
(31:37):
questions about car spontaneously exploding? Right? Is that a good summary?
That is accurate? It is insane, but it's accurate. You know.
I wrote a story about this kind of calculating really
how many combustible engine cars should spontaneously combust if they
were too equal the percentage of Tesla's that's spontaneously combust
and the numbers do not look good for Tesla. There
(32:00):
are a lot of reasons why the cars could be
spontaneously combusting, and they have to do with battery technology.
Tesla's batteries are actually a bunch of laptop batteries strung together,
and if one of the little cells explodes, whether it's
thermal runaway or there's some kind of defect inside of
the battery, one in a billion spontaneously combusting, as one
(32:23):
of my sources told me, which is quite possible in
this kind of battery technology. The rest of the cells
could also explode in what is called sympathetic detonation, and
that can cause a fire. So I've read fire reports
from people who I had a flat tire and I
want to change my tire, and as I was driving home,
(32:46):
my battery started smoking, possibly because of the impact of
the tire change, who knows, But Tesla really doesn't give
people explanations for that. You know, the battery is at
a certain point ruined, So how do you investigate the
root causes of that? And is that a contrast with
how the Big three would handle things? When I think
(33:06):
about not that they've been perfect by any means, but
when I think about GM's recalls, that seems to be
a little bit more of a concern for consumer safety.
Perhaps maybe I'm giving the Big Three too much credit.
I don't know, because I don't cover cars. I cover
the craziness of Tesla. I cut my teeth covering things
that I think are a little bit scammy. Yes, so
(33:29):
I don't. It's a good background to have, actually, because
once you've realized what scammy is, and you realize it exists,
and you realize the belief system that goes along with it,
it actually gives you a new lens to look at
the world. Right. Yes, and how easy scams are to perpetuate. Yes,
you don't get surprised anymore by how long anybody can
(33:49):
pull something off or how big it got. That doesn't
surprise me. Ever, it becomes almost a defense in some
ways because people think, well, it's gone on so long,
it can't possibly be a scam, or if it were
a scam, it would have blown up by now, And
all you have to do is have a little understanding
of history to say no, not at all. So back
to Solar City. One of the theories that I heard
(34:10):
the reason for the acquisition, and I was laughing when
you use the phrase sympathetic detonation, was that that's what
letting Solar City would go. Having let it go bankrupt
back then would have caused a sympathetic detonation and the
rest of Musk's empire because it would have cast out
on the mythology of Elon Musk, and so he needed
at all costs to prevent that from happening. But by
(34:32):
acquiring it, he's now perhaps the irony is the catch
twenty two is that he's now perhaps caused himself a
bigger problem. Were you surprised by any of the revelations
and the unsealed complaint that came out just recently. I
was surprised at how involved Musk was in the deal,
very hands on, very hands on, and I thought maybe
(34:56):
it was something that bankers handled, maybe it was something
that his cousin who were running Solar City handled, and
he was just like, show me where to sign on
the dotted line. I didn't realize that he himself was
the one calling the shots. He was the maestro, calling investors,
trying to persuade the ones that weren't on board to
do this, calling the bankers right, trying to raise cash
(35:18):
for Solar City. I found the most shocking part of it,
and we had known this, but just the way in
which he and his cousins had lent money to Solar
City before the acquisition via these solar bonds, and the
way in which they were so quickly repaid after the acquisition.
It was hundreds of millions of dollars. I mean, the
self dealing, and that the idea. I don't think there's
(35:41):
another CEO. There certainly aren't many CEOs who could get
away with that. No, and that's the board, that's shareholders.
They don't care apparently, I mean, that's the sec they
don't care. No one cares. So I guess we're just
going to be wringing our hands. I'm going to continue
to watch fake Lynette Twitter accounts. That's just the way
the world is. Now. Let's let's talk about that for
(36:02):
a little bit. Felix Samon, his credit gets laid, among
other things, wrote about the stalking of you. He wrote,
this is worse than just stalking. Musk is setting his
army a fanboys loose on Lopez. He's retweeting stuff they find,
and he's encouraging them every step of the way. Musk's
harassment of Lopez is obsessive and deranged. Why do you
(36:23):
think that is? Why do you think he has had
a problem with you and with female journalists in particular.
First of all, I don't think these guys really like
it when women to try to tell them what to do.
I've read about Elon's marriages and his relationships with women.
I am not a therapist, but it seems like he
is very insistent on being the alpha. Yeah. I think
(36:43):
it threatens his ego, it threatens his manhood that a
woman is coming after him, and I think he knows
that a lot of his followers have. You know, there
are a lot of them who are very, very very
anti anti woman. I've gotten some really really nasty emails
and nasty, nasty messages. I don't keep my dms open.
I'm no longer on Facebook, but I'm flattered by it.
(37:07):
And that's also why I tweeted out Mariah Carries, why
are you so obsessed with me? During this time? I
was done by some of this as I dug into it. Though.
Another journalist named Aaron Bieba, who criticized Musk, one of
the tweets that her was you criticized a man with
a cult following of twenty one million plus followers. You
should have seen it coming. You brought it on yourself again,
this sort of warped logic in which because Musk is
(37:30):
so famous and has so many followers, he somehow should
be beyond any kind of criticism. It's adorable. It's adorable.
That was not the word I thought was going to
come out of your mouth, because it's so pathetic, it's sad. Yeah,
he's not your dad. He doesn't need you to defend him.
He doesn't need you to defend him. He doesn't care
(37:51):
that you're defending him. He's taking his private jet from
one side of LA to the other. Honey, he doesn't
care about you, Okay. Isn't that amazing saying how some
people have that ability to convince other people though that
somehow they do care or there's something in it for
them too. That that quality that people have is just
endlessly fascinating to me, because visionaries have it and fraudsters
(38:14):
have it, right, and they both have it in spades,
and it makes it very difficult in the moment to
tell the difference between the two. Yes, it does. There
is a attention as a journalist in covering someone like Musk,
because you're supposed to be unbiased. When you cover anything,
you're supposed to approach it with an open mind and
(38:37):
just getting the facts. And at a certain point, though,
you start to understand what you're covering. And once you
start to understand it and you make a judgment about
what you're seeing in front of you, that's when people
can say, oh, you have a bias. Now you've injected
your bias. But is it bias or have you simply
done your job? I would argue the latter. I would
(38:59):
argue that it's by if a you start with a
predetermined point of view and you're trying to prove that
and that's why you come to have your point of view.
It's bias if you refuse to hear things that are
counter to your argument because you don't want you because
you don't want to hear them. And it's bias if
you have something at steak other than getting it right.
But the only thing we at journalists, as journalists have
(39:21):
at steak is being right. We don't want our stories
to look ridiculous a year from now, two years from now,
five years from now, ten years from now. We want
to look right. And if we have nothing more at stake,
then getting it right. Then, I actually think it is
a lack of courage not to take the information you've
learned and use it to make a point, particularly if
that point is running counter to the established narrative, because
(39:43):
then you're making people think. And if you can make
people think, isn't that one of the great points of life.
I've had a lot of delicious meals in my life,
but nothing is delicious as being right. Yet never eaten
anything better than that exactly right. And there's nothing more
distasteful than being wrong or shameful than being wrong. Right. Yeah,
So I mean in twenty thirteen, twenty fourteen, I was
(40:05):
like Elon Musk, Tesla, Megan Green Cars, everybody loves it great.
It really wasn't until I started understanding the company that
I was like, there is a dark side to this.
And I have not yet encountered anything, not from Tesla PR,
not from people inside of the company, even from people
who love the company, that has been able to show
(40:27):
me that I've gotten this all wrong. And and in fact,
my engagements with Tesla PR only make me more suspicious
of what the hell is going on in there? What
do you think do you worry about being wrong? Unlike
these guys on Wall Street. I don't have any money
behind this, so being right is all I've got. Right.
(40:49):
Is there anything you could hear that would change your mind?
Is there anything anybody could say or something you could
learn that would make you say that would make you
know how that happens? Sometimes where your perspective suddenly then
you see the same series of events through a different light.
Tesla would have to become profitable, yep. And the numbers
would have to work, right, number tesky little numbers, test
little numbers would have to work. And I would have
(41:12):
to start hearing from employees that they're being treated well, yeah,
and that the company cares about them. Oh, and from
customers that the cars are working properly. I start working.
To me, the compelling pieces of evidence that all is
not well at Tesla is the string of executive departures. Absolutely.
What do you hear about that? Working for Elon is
(41:34):
hard and you don't want the eye mortar, and after
a while you burn out, or you collect so many
secrets that you're just in So you either by the cult, yeah,
and you collect the secrets and you move up fast,
or you see what's going on, or Elon burns you
(41:57):
out and you leave. There are a lot of people
who love the challenge of working at a small organization,
like relatively small compared to the traditional at something that's
trying to change the world, something change the world, unique
engineering challenge, you know, very do it yourself sink or
swim culture. But ultimately it is nerve racking. I've had
(42:20):
sources whose entire families have turned on Musk because Daddy
has to go to the factory at six a hundred morning,
and he has to come home at night for dinner,
but then go back to the factory for maybe like
a skip level meeting or something at ten pm, and
then it starts a day all over again. Tesla is
(42:41):
a lifestyle, it's not just a job, so that lifestyle
can be toxic to some people. It's actually really interesting
because there's a great story from C. S. Lewis called
The Inner Circle the Inner Ring, and it's about how
compelling it is for most people once they get on
the inside, because we've all experienced what it is to
(43:01):
be on the outside, and once you're on the inside,
it's so compelling that you will basically do anything to
stay there because the allure is so so overwhelming. And
so when you see a company like Tesla where people
are being admitted to the inner circle and then leaving you,
there's something pretty astounding about that, right, most astounding was
his lawyer quitting. And yes, January was it. Yeah, after
(43:26):
he sent another tweet, his lawyer quit pretty much forty
eight maybe twenty four hours. It was so fast. And
changing horses in the middle of a lawsuit. Always having
different attorneys, that's always a red flag as well. And
Elon has a lot of different attorneys, Yes, that is
for sure. There are a lot of lawyers making fees.
(43:48):
Oh yeah, you know. I was thinking about this issue
of retaliation against critics, and I thought, to be fair,
we should point out it actually isn't only against women, right.
That's been the mob on Twitter. The Muscians on Twitter
seem to have directed a fair amount of their ire
toward women. But Elon has also fired this lawsuit against
ran Deep Hothy, the Tesla cue member who did a
(44:09):
lot of research into Musk. There's the Cave Diver episode
and the lawsuit against that, which is probably pretty well known.
Is crazy. I don't like bullies, and I think that
it is very suspect when someone with the power and
the money and the resources of Elon Musk goes after
(44:29):
a grad student like ran Deep, or a random diver
or a little journalist. I cannot imagine Elon ever suing
David Einhorn or Jim Chenos people with you're right. He
picks on people you're right. He picks on people who
he thinks doesn't don't have the means to fight back.
He would never sue. It's a really good point. He
would never see the Times, He's never gonna see the
(44:51):
journal He's never gonna see any of these publications. He
will only sue people who he thinks cannot beat him.
And that upsets me. That's such a good point it's
worth pointing out for listeners. What happened to this young
man named Randy Pathi who was sued by Tesla reportedly
for endangering employees. But when he got funded to actually
(45:14):
have a lawyer and said, well, Tesla, you need to
turn over the documents that show me doing this, in effect,
Tesla dropped the lawsuit. They just expected to be able
to destroy him because he wouldn't have the means to
fight back. And you're right, that's a very different picture
than going after people who can fight back, and I
can't fight back on the internet. I can't fight back
on Twitter, but he can't sue me. What would you
(45:36):
say if I were a big investor sitting here making
a decision whether or not, or I were somebody who
had the power to give Elon Musk half a billion dollars?
I don't. By the way, let's be clear if just
to say, let's pretend, why would you say this matters
about Musk's habit of bullying? Why is this an issue?
Because it means he's hiding something. It means that he
(45:58):
cannot handle any scrutiny at all. It means that he
is not willing to tolerate dissent or criticism of any kind.
And it means that he has time to swat at flies?
And how does he possibly have time to swat flies?
(46:19):
So a last question for you, how and when do
you think this plays out from where we sit today? Oh,
my lord, Jesus, be a biscuit and just stop me up.
I don't know, I don't know. I never heard that
phrase before. That's awesome. I don't know how this ends.
(46:40):
We don't have an sec we don't have regulators. We've
got compliant capital markets at least at least for maybe
not anymore. Maybe we work as a turning point. Maybe
maybe we work as a turning point. Maybe if we
don't have a million robotaxis on the ground by next spring,
as Elon promise last spring, or if they aren't a
(47:01):
thousand solar roofs being installed each week by the end
of this year, as Musk just said would be happening,
maybe that will be an issue for the markets. I
don't know. I don't consider the markets completely and totally efficient,
especially not now. I consider the markets a collective understanding
of how we feel in the present about the future,
(47:24):
not necessarily a smart understanding, isn't it Canes who said
the market can remain irrational longer than you can remain solved.
Absolutely so, I don't know where he's going to pull
out another moneymaker, though he doesn't seem to have the
cash to the revamp the smmecs, which are the two
models that actually make margin. I don't think that China
(47:46):
is going to be a huge success because we're seeing
the automarket there crater and electric vehicle manufacturers in China
are not doing well. So I don't know, but that said,
one lesson you've learned at least which will be true
until it's not. As don't count Elon Musk out right.
Oh no way, no way. I mean, if there's anything
(48:08):
I can say about Elon that is positive is that
he just won't go away. Yep. The guy's got incredible will,
He's got an incredible way will ye yeah, Iron, And
it's going to be really interesting to see how this
plays out. So thank you so much for taking the
time to talk to me. We'll stay in no doubt.
So that was fun. I expected Lynette to have strong opinions.
(48:32):
She's covered Musk from much longer and in much more
detail than I have, but I think she summed up
something we both realized. There is nothing about this that's normal.
My view is that maybe Musk will change the world,
maybe he'll get us to Mars, save the planet, rewire
our brains, but he'll do it despite his quirks, not
(48:53):
because of them, because there is nothing about his misrepresentations,
his failed promises, his treatment of him employees, and most
of all, his bullying that is good in any way
make you a killing
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