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What a Tweet! Tesla slumps after Musk asks Twitter if he should sell

Elon Musk is known for his bizarre posts on social media – and has often fallen foul of financial regulators with his controversial tweets.

But the Tesla chief executive made possibly his most unusual move yet over the weekend.

The world’s richest man – with a total net worth of £251billion – asked his Twitter followers to decide whether he should sell a massive 10 per cent chunk of his holding in the electric car company.

Tesla chief exec Elon Musk (pictured) asked his Twitter followers to decide whether he should sell a massive 10% chunk of his holding in the electric car company

Tesla chief exec Elon Musk (pictured) asked his Twitter followers to decide whether he should sell a massive 10% chunk of his holding in the electric car company

Around 3.5m users of the social media site cast their vote in the poll, and 57.9 per cent said yes.

If Musk honours their decision, as he has promised, he will have to sell around 17m shares – which are worth £15billion at today’s price.

With that many shares coming onto the market, Tesla stock slumped nearly 7 per cent before recovering to a 3 per cent drop. It was the latest example of Musk, 50, causing shockwaves with his tweets.

Over the years his comments on social media have caused wild swings in Tesla’s share price, shaken up the value of crypto-currencies such as bitcoin and dogecoin and provoked US regulators to launch lawsuits against him.

The eccentric entrepreneur and father-of-six, who has run Tesla since 2008, said at the weekend that ‘much was being made’ of the fact that most of his wealth is stored in shares, meaning he pays little in tax.

Musk tweeted: ‘I do not take a cash salary or bonus from anywhere.

‘I only have stock, thus the only way for me to pay taxes personally is to sell stock.’

Running a poll on Twitter, he added: ‘Much is made lately of unrealised gains being a means of tax avoidance, so I propose selling 10 per cent of my Tesla stock. 

‘Do you agree?’ It seemed that Twitter users did as the vote closed on Sunday night. And asked whether it had gone the way he wanted it to, Musk said: ‘I was prepared to accept either outcome.’ 

The bizarre vote came weeks after he slammed President Biden’s plan to launch a tax on billionaires in the United States, which would leave Musk with a mammoth bill.

Under the proposals, the US president will levy a tax held on the assets of the country’s very richest – even if they do not take a cash income.

Referring to the reform, Musk tweeted last month: ‘Eventually, they run out of other people’s money and then they come for you.’

Earlier this year, it was revealed that Musk and his rival, Amazon founder Jeff Bezos, have in recent years paid nothing in federal income tax.

Ron Wyden, an Oregon Democrat and chairman of the Senate finance committee who has led the plans for the tax reform, dismissed Musk’s poll as a stunt.

He said: ‘Whether or not the world’s wealthiest man pays any taxes at all shouldn’t depend on the results of a Twitter poll.

‘It’s time for the Billionaires Income Tax.’ Musk responded with a crude tweet referring to Wyden’s genitals.

He also changed his Twitter name to ‘Lord Edge’ – an apparent reference to the term ‘edgelord’, which according to Oxford Languages is used to describe ‘a person who affects a provocative or extreme persona, especially online’.

The Twitter poll was the latest example of Musk – who recently split from pop star girlfriend Grimes – using the social media platform in a way which has raised eyebrows.

In 2018, he baselessly branded a British cave explorer who had been trying to rescue a group of boys stuck in a Thai cave ‘pedo guy’. Musk won a lawsuit when the explorer tried to accuse him of defamation.

The billionaire’s lawyers claimed in court that the phrase ‘pedo guy’ was clearly meant as an insult – which is considered protected speech – and that Musk had never actually meant to imply the rescuer was a paedophile. 

Musk has also become known as a vocal backer of various crypto-currencies. He tweeted in support of bitcoin several times, pushing up the price of the digital asset.

He even said Tesla would start accepting bitcoin payments for its cars, but later rolled back stating the crypto-currency was too energy intensive, which saw its value tumble.

Musk now seems to be throwing his weight behind dogecoin, a crypto-currency based on a dog which was initially launched as a joke.

Since he tweeted about the coin in early March, its value has rocketed by 460 per cent.

Car trouble: Tesla's valuation has already been destabilised by Musk's Twitter activity

Car trouble: Tesla’s valuation has already been destabilised by Musk’s Twitter activity

This is still a way off the peaks it hit in May on the back of Musk’s support – meaning any traders who had bought dogecoin at its heights may now be smarting.

But it wouldn’t be the first time Musk has angered investors. An April fool’s joke in 2018 backfired when he tweeted that Tesla had gone ‘completely and totally bankrupt’. 

While many shareholders recognised the post as a joke, others were fumed when Tesla shares slumped 7 per cent as the stock market opened the following day.

That same year, Musk locked horns with US financial regulator, the Securities and Exchange Commission (SEC), after tweeting that he planned to take Tesla private and had the funding to do so – a move which sent the shares soaring.

A deal never materialised. After a lengthy lawsuit, which was eventually settled for £15million each from Musk and Tesla, the SEC ordered that all of Musk’s tweets must be approved by his company in future.

But the slap on the wrist failed to deter Musk and the SEC wrote to Tesla in 2019 and 2020 about more tweets which supposedly violated the settlement.

And on Twitter just last month, Musk said he would sell Tesla stock and donate it to the UN’s World Food Program if leaders at the organisation could describe exactly how the money would ‘solve world hunger’.

It was unclear whether he actually planned to give away any of the money he will raise from his proposed share sale after the Twitter poll.

AJ Bell’s investment director Russ Mould added: ‘Some investors might be taking Musk’s comments with a pinch of salt.

‘He has often made comments on Twitter, implying one thing and then doing the opposite soon after.’

But his actions could irritate shareholders whose interests he is supposed to protect, Mould warned, because ‘the incident has already destabilised the company’s valuation.’

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