Elon Musk turns into Trump on Twitter

Elon Musk of Tesla fame has a knack for getting his name in the headlines. There is barely a week goes by when his name doesn’t appear in the media somewhere, whether it is the mainstream media or more niche sectors of the press. This week he has taken on the Wall Street Journal (WSJ), because he is fed up of journalists’ criticisms of Tesla.

As always, Musk launches his attacks on Twitter. This time he presented the WSJ and its columnist Holman Jenkins as “sock puppets for “big oil.” In one tweet he asked his followers: “Please support my campaign to rebrand WSJ as sock puppets emoji.”

Francois Asure at CCN finds it very odd that Musk should behave somewhat like Trump on Twitter, suggesting that surely as a creative genius, Musk can do better than hurl “Trump-style epithets” at such an esteemed institution. Asure was referring to the way in which Trump branded Hillary Clinton, “Crooked Hillary”, and he also called Kim Jong-Un “Little Rocket Man.” Presumably he didn’t call him that when he met him at their famous summit meeting.

Instead, Musk appears to be adopting Trump’s tactics with the WSJ, simply because he doesn’t think the paper gives him fair coverage. It sounds a lot like Trump’s ongoing battle with The New York Times, CNN and his other perceived media enemies that he is sure tell lies about him. It often comes across as childish petulance on trump’s part, and Musk’s response to this WSJarticle, “Tesla Can’t Stop Dreaming Big.” The introduction reads: “Elon Musk’s plans to turn Tesla into a dominant automobile player have become a liability instead of an asset.” It is a less than glowing account of Tesla and the upheavals within the company. It also questions Musk’s leadership style and the way in which he uses his personality –“erratic, bombastic and alternative” –to draw attention to his brands.

As Asure remarks, “For the CEO to use Twitter to communicate with shareholders is about as unusual as a U.S. president turning to the social media platform to craft a message.” And as he rightly points out, the way in which Musk courts media attention is always likely to lead to some negative reviews. It is not difficult to see why the WSJ cites Musk as a liability for Tesla; he positions himself as bigger than his car brand. If you stopped the average man in the street, I’d say it is likely that they know more about what Musk gets up to than the engineering or design of a Tesla model.

And why did he choose to use “big oil” as his idea of an insult? Simply because his fan base is into electric cars, and oil, a fossil fuel, is the nemesis of those who are environmentally conscious. The oil industry probably doesn’t love Elon Musk much either, but as Asure points out, the oil industry often gets a “free pass” in the press, whereas the Tesla story is much more entertaining for any journalist.

And Musk often makes big claims that he can’t follow through on, which is more grist for the media’s mill. But, the point of this whole story is to illustrate how social media has become the battleground for characters like Musk and Trump. When their backs are against the wall they hit out in tweet form. And it often backfires on them, because calling people names makes things personal that should be treated with gravitas and diplomacy. However, neither Trump nor Musk possesses much of these qualities. While Musk’s tweets are entertaining, as are Trump’s, he is in danger of allowing his game playing to obliterate his Tesla brand; just as Trump’s outbursts have lowered the tone of the Office of the President of the United States.

Should we focus more on bitcoin’s use case than its price?

The crypto rollercoaster has morphed into ride with only slight dips and rises this month. It seems s if every few days traders need to take a rest and the bitcoin price sags a bit, The majority of the leading altcoins appear to follow what happens with bitcoin, although not uniformly.

As we head into next week, it’s hard to predict what we might see, although the weekends tend to bring some dips, suggesting that on Friday traders think about exiting the market for a couple of days. Jim Preissler writing at Forbessuggests: “Heading into the new week, expect possible dips to still be well supported at $4,700 in BTC and $154 in ETH. $5,800 and $187 could be tough resistance.’

As Preissler points out, XRP does not seem to have benefited from the latest crypto rally as much as BTC. ETH and LTC and there appears to be resistance at the $0.38 mark. ETH has been consistently outperforming XRP since February and it doesn’t look like there is going to be much change there.

Omkar Godbole at Coindesk suggests that what is needed to move the market along is a breach of BTC’s new resistance level of $5.200. As I write on 17th April, we have a slight glimpse of that as BTC touched $5,200.14. The market-leading cryptocurrency picked up a strong bid at lows below $4,200 on April 2 and jumped to 4.5-month highs above $5,300 on April 8, confirming a bullish reversal. However, over the last couple of days that rally paused, which Godbole attributed to BTC being overbought amongst other factors. But momentum seems to moving in an upward direction again. And, as Godbole has pointed out, “the longer duration outlook will remain bullish as long as prices are trading above $4,236.”

For the moment, bitcoin is trading above that level, but are we too focused on price?

As more real life use cases for bitcoin appear, such as the news that UK’s largest travel agency Corporate Traveller is now accepting bitcoin for payments, and the town of Innisfil in Ontario accepts BTC to pay property taxes, it is to be hoped that the public sees more advantages to using bitcoin for a range of payment purposes. That should encourage more belief in the cryptocurrency, and boost the number of people owning e-wallets and joining exchanges to purchase crypto. Slowly, slowly, cryptocurrency is edging forward toward mass adoption. We are a long way from that yet, but there’s no need to panic. It takes time to adjust to the new, even when the use case and the benefits are clear to a few. Just think back to the beginning of the Internet and the length of time it took the average consumer to feel comfortable with it. When people understand the benefits of using bitcoin and focus less on the price it is trading at, I believe that is when we’ll see a sea change in the crypto market.

Jack Dorsey: the billionaire on a $1.40 salary

I’ve discovered something truly strange: Jack Dorsey, one of the co-founders of Twitter, takes home an annual salary of $1.40. Why this odd amount? Well, it is a nod to the original 140-character limit for a tweet. He would of course be within his rights to ask for $2.80, since Twitter expanded the maximum number of characters that can be used to 280.

Dorsey is, of course, known for being a billionaire, and Twitter generated a revenue of $909 million in the last quarter of 2018 alone. His SEC filing revealed: “As a testament to his commitment to and belief in Twitter’s long-term value creation potential, our CEO, Jack Dorsey, declined all compensation and benefits for 2015, 2016, and 2017, and in 2018 he declined all compensation and benefits other than a salary of $1.40.”

Why does Dorsey do it?

Gerelyn Terzo writing at CCN suggests it makes him and his company look good, and Terzo remarks, “His creativity to reflect the Twitter character limit is second-to-none.” But let’s not forget that in 2018 he offloaded a lot of stock. He sold 1.7 million shares from Square to net him $80 million after taxes. And by the way, he only takes home an annual salary of $2.75 from Square. This company, which makes devices for small businesses to accept credit card payment sin person, was struggling to become profitable, but in 2018 its stock climbed by 80%. And the majority of Dorsey’s fortune is tied up in Square equity. As Forbes reports, “Thanks largely to the run-up in the stock, he is now worth $1.9 billion more than at the start of the year. His net worth currently stands at $4.7 billion, with his 61 million shares of Square accounting for $3.9 billion.” By contrast, Dorsey hasn’t touched his Twitter shares this year and they surged by 50% in value in 2018, giving him a stake worth $600 million.

Dorsey isn’t alone

Dorsey isn’t the only billionaire who takes a nominal salary. Donald Trump donates his $400,000 presidential salary to different causes and Elon Musk never cashes in his annual salary of $45,936, which he is forced to accept under Californian law. Mark Zuckerberg of Facebook is paid $1 per annum, as is Evan Spiegel at Snap.

Bankers prefer big money

Significantly, banking CEOs, do not take the same approach as the founders of media and tech giants like Twitter and Facebook. They are firmly wedded to their eye-watering salaries, despite the banking crash of 2007. Swiss Bank UBS is currently under scrutiny for its CEO’s excessive salary of $14 million. But Jamie Dimon at JP Morgan Chase is paid $30 million per annum. No wonder that when the banker was in front of Congress last week, he was closely questioned about why some of the bank’s staff were finding it impossible to reach the end of the month without needing overdraft facilities. Katie Porter’s questioning of Dimon should have made him squirm, but his face didn’t move a single muscle as he responded to her questions with, “”I don’t know, I’d have to think about that.”

But the real question here is: are the likes of Jack Dorsey really the good guys, and the bankers the baddies? Perhaps it is their employees who can answer that question?

Brexit brings FUD to finance

Brexit is like a long-running soap opera, or a comedy. At times it has come close to being a ‘real life’ version of ‘Fawlty Towers’, the comedy series starring Monty Python’s John Cleese as the ‘Little Englander’ manager of a seaside hotel. It has also resembled a Monty Python sketch, as the Dutch prime minister Mark Rutte, suggested.

But, while we may look on with our mouths wide open in shock at the shambolic mess at the Mother of Parliaments, there are of course serious concerns about the effects of the endless delays. Just yesterday the leaders of the EU 27 granted the UK a further extension until 31st October to sort it out. Is it going to be enough, UK businesses are asking, and they are more fed up with the uncertainty about the future of the UK and its future trading relationship with the EU than many others. And, understandably so. Over the past few months we have heard any number of stories about how the loss of the Single Market and a Customs Union will impact on British businesses in the manufacturing sector, and the automobile industry has already taken a hit, albeit for other reasons as well as Brexit. However, the UK economy relies much more heavily on service industries, especially financial services.

Money is flowing back to the EU

Since the UK voted to leave the EU in June 2016, the passporting rights of the City’s institutions has been of concern. There have been many warnings that the biggest players would decamp to Paris, Frankfurt or Dublin, but so far this hasn’t happened in a major way. However, we have seen money flow out of the UK to the EU. For example, Frankfurt Main Finance noted that it would be moving $800 billion back to Germany this year. And it is estimated that a trillion dollars worth of assets have been relocated from the City to other EU countries.

As Roger Aitken writes for Forbes, the chaos has had a “chilling effect” on financial institutions. How can they plan for the future, or introduce new strategies, when they have no idea what is looming around the corner? As he says: “With no clear framework for how cross-border transactions and interactions will be coordinated in the aftermath of any exit, the desire to take any risks is entirely absent.”

It’s an opportunity for some

Yet there are those who see Brexit as an opportunity. Asaf Elimelech, CEO of trading platform Plus500, which provides online trading services with contracts for difference (CFDs) has noted: “Brexit may be an unwelcome distraction in political terms, but it has been a fertile source of CFD trading opportunities for customers.” However, his seems to be a lone voice in the wilderness.

By contrast, EverFX, the official sponsor of Sevilla FC, has put a halt to its application for a Financial Conduct Authority (FCA) licence that would allow it to operate in the UK. Its CEO George Karoullas

said: ““The whole Brexit debacle has spread a feeling of uncertainty across all industries and economies in Europe, and the trading vertical is not an exception. We consider the U.K. one of the most lucrative, interesting, and challenging markets in the world, and were thrilled at exploring what it has to offer.”,

For now the uncertainty potentially continues until the end of October. The City’s financial institutions have no clearer view of whether they will be able to maintain passporting rights that allow EU firms to have a single license in an EU country and apply it across the region’s Single Market without further approval hurdles, and until that is resolved, we can expect to see hope fade and fear increase amongst the financiers and bankers. The drastic effect that Brexit is having, and will continue to have for some time, on the British economy cannot be underestimated, yet the Leave Voters still think it will all be just fine. Perhaps they should reflect on the fact that the rest of the world sees it very differently, and so does business, which is living with fear, uncertainty and doubt (FUD).