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Elon Musk Among Witnesses Expected to Take the Stand This Week in Tesla Tweet Trial

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Elon Musk is among the expected witnesses to appear this week in the ongoing federal trial accusing him of deceptively driving up the price of Tesla stock by tweeting about taking the company private, which never happened.

The August 2018 tweet in question stated that Musk had “secured” funding to take Tesla private at $420 per share. The company’s stock was slumping at the time due to production problems.

Tesla shareholders filed a class-action lawsuit suing Musk for billions of dollars in damages for money investors say they lost after the tweet inflated share price. The trial, taking place in San Francisco, is expected to last for three weeks. 

Investor Glen Littleton from Kansas City, Missouri, is seeking damages on behalf of shareholders who traded the company’s stock in the days after Musk’s tweet. 

Littleton had purchased Tesla investments with hopes that the automaker’s stock would eventually be worth far more than $420. Upon seeing Musk’s tweet, he felt compelled to sell his Tesla stock options since he knew the completed deal would have rendered them worthless. 

He stated he sold off most of his Tesla positions to try and limit his losses, but even after doing so, the value of his Tesla portfolio plunged by 75%.

“The damage was done. I was in a state of shock.”

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The case’s outcome may depend on whether Musk knowingly raised Tesla’s stock price by tweeting that he had secured money for a $72 billion takeover of the business. The stock plummeted in value when it became apparent that he lacked the funding to complete the deal a week later. 

On Wednesday, Nicholas Porritt, lead attorney for the investors, told the trial’s jury of nine that “millions of dollars were lost when his lies were exposed.” 

“Why are we here? We are here because Elon Musk, chairman and chief executive of Tesla, lied. His lies caused regular people like Glen Littleton to lose millions and millions of dollars.” 

Porritt also pointed out that not only did Musk’s tweet cause investors to lose money, but it also affected pension funds and other organizations that owned Tesla stock.

The trial’s presiding judge, U.S. District Judge Edward Chen, has already ruled that Musk’s tweet was false and reckless. 

Porritt took advantage of the judge’s verdict and told the jury they should presume Musk’s tweet was false, which the judge permitted.

“When the CEO of a public company like Tesla lies about his company and hurts investors, it’s critical that he is held accountable for that harm that he causes.”

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In his opening statements, Musk’s attorney Alex Spiro insisted that Musk was “serious” about the buyout when he tweeted about securing funding.

“You will come to learn very soon that this was not fraud, not even close.”

Spiro argued that the rise in Tesla’s stock price after the tweet was due to investors’ faith in Musk’s capabilities and reputation as a visionary.

“Mr. Musk tries to do things that have never been done before. Everyone knows that.”

According to Spiro, Musk and representatives from the Public Investment Fund of Saudi Arabia had already discussed taking Tesla private.

“He didn’t plan to tweet this. It was a split-second decision.”

Spiro said Musk used the “wrong words” in a rush to be transparent about the potential deal with the Saudi fund.

Musk is on the witness list for both sides of the case. Porritt told The Associated Press that Musk is expected to take the stand when the trial resumes on Friday, if time permits, or on Monday.

goldman sachs

Goldman Sachs Gearing Up To Lay Off Up To 3,200 Employees This Week 

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According to reports from an individual involved in Goldman Sachs, the company will be laying off up to 3,200 employees this week as a means of saving on costs. 

The source who spoke with CNN stated that more than a third of the projected layoffs will come from the firm’s trading and banking units. These cuts are a result of uncertain economic and market conditions, as Goldman Sachs has recently been feeling the impacts of a decrease in global dealmaking. Many companies are leaning away from mergers and raised capital with the firm. 

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As reported by Bloomberg, hiring for roles in other departments will continue into the new year, and a new class of analysts are also expected to start working for the firm later this year. 

At the end of the third quarter Goldman Sachs reported having around 49,100 employees after adding thousands of positions during their recovery from the pandemic; which many financial markets have also done. 

Overall, the Federal Reserve and other major banking firms have begun to raise their borrowing costs as a means of combating inflation rates throughout the nation. 

Many companies are working on saving money by any means necessary to prepare for a possible recession that would occur as a result of rising interest rates. The rate of mergers and acquisitions have overall been on the decline as well. 

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Goldman Sachs is one of the most well known firms that’s involved in these mergers and acquisitions as well. So with the recent decline in transactional activity, the firm experienced a 12% drop in revenue in the third quarter of 2022 when compared to one year ago. 

Investment banking revenue overall has decreased by 57% yearly, according to reports. 

This past October Goldman Sachs announced part of its plan to streamline operations by combining their trading and investment banking divisions, as well as combining its digital consumer bank, known as Marcus, with its wealth management sector. 

Reports indicate that shares of Goldman Sachs were up less than 1% in premarket trading as of this week. 

Goldman Sachs isn’t the only massive company planning on implementing layoffs in their 2023 plans. Amazon stated earlier this month that they plan on laying off more than 18,000 employees while Morgan Stanely have already begun layoffs in the new year.

U.S. Stocks Climbing Despite Uncertainty Surrounding Presidential Election

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Tech-led stocks in the US began climbing when the market opened up on Wednesday morning, despite there being a lack of clarity in terms of who will win the 2020 presidential election. 

According to reports, The Dow Jones Industrial Average increased by 500 points, or 1.7%. The S&P 500 traded 2.3% higher while the tech-heavy Nasdaq Composite increased by 3.2%. Mike Lewis is the managing director of US equity cash trading at Barclays, and spoke with the press this morning about these surges. 

“I think that the outlook going forward for markets is this is going to be more about policy and the Fed than it’s going to be about politics, which is a good thing for markets.”

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Key swing states like Wisconsin and Pennsylvania could take a while to fully determine how the votes will lean. Both candidates and their camps are confident in their paths to victory this week.

Amazon, Microsoft and Apple all saw spikes of at least 3% in their stocks while Facebook increased by 7%, and Google-parent company Alphabet jumped more than 5%. Traders on Wall Street attribute these spikes to a multitude of factors. The possibility that Republicans will maintain control of the Senate is a positive for the groups, as a Democrat congress could have weighed down on the high-growth sector, according to Barry Bannister, Stifel Head of Institutional Equity Strategy.

“It appears investors may be satisfied with at least half a Republican Senate and no tax increase, knowing they have a ‘Fed put’ if fiscal assistance is slower in coming. This favors Growth stocks over Value near-term.”

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Traders are also still grappling with the idea of a contested election, as Wall Street strategists claim that could have major consequences for the stock market. “News of a contested election could cause a sharp drop in stocks in the very short term, but we do not see it as a bearish gamechanger,” Tom Essaye, founder of the Sevens Report, said.

Traders are also watching the Senate race closely as the result of that race will have major implications on the future of the market as a whole. A Democrat win in the Senate and a Biden presidency has a lot of traders worried about the higher tax rates that would impact technology shares especially. 

On the other hand, some traders think a blue wave in the Senate and White House could lead to a larger stimulus package for Americans as we continue to battle the coronavirus pandemic; which would also boost stocks linked to the larger economy. 

“When this is all said and done, I still believe equities will move higher regardless of who wins the Oval Office. The coronavirus pandemic and U.S. monetary policy will be bigger market drivers over the long haul,” said Ryan Nauman, market strategist at Informa Financial intelligence.

Real Estate Investing

The Pros and Cons of Investing in Real Estate

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Investments are a smart way to expand your wealth, as the returns on long-term investments can be substantial. However, when considering how to invest your money, it’s important to take into account various options. While investing in the stock market is common and relatively safe, it may be a better choice in some cases to invest in real estate instead. Buying land as an investment is fundamentally different from investing in stocks, and as such, before you make a decision, it’s best to consider how these differences are likely to impact your returns.

According to Andres Pira, the CEO of Blue Horizons Developments, there are many advantages to investing in real estate. When buying property instead of stocks, you have more control over your profits. Investing in the stock market requires buying stocks when they are low and selling them when they are high, and it can be difficult or sometimes impossible to predict how the stock market will behave. Real estate, on the other hand, is more fixed, as variables like size, location, and features remain in the buyer’s control. Additionally, when selling real estate, you have the power to negotiate your price depending on who you’re selling to, which you cannot do with stocks.

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Another advantage of real estate investments is found in their consistency. If you’re a landlord, you can expect a consistent cash flow in the form of regular monthly payments from your tenants. Generally, as time goes on, the cost of rent increases to match inflation, meaning that if you’re a landlord, you can expect monthly payments to increase with time. While the stock market offers the potential for an unexpectedly high payout, it carries with it a risk of losing a substantial amount of money, given the difficulty of predicting economic changes.

Investing in real estate is also unique in the sense that it enables certain tax advantages. For instance, real estate owners can take advantage of a depreciation expense, which allows them to save money on their taxes significantly and use those savings to reinvest, pay back loans, and more. Real estate can be a tricky market to invest in, however, and investors need to be careful about the property they choose to buy by putting substantial time and effort into research and other due diligence.

There are also a number of disadvantages to real estate investments. For one, property is very expensive; while you can invest in the stock market with a relatively small amount of money and still expect moderate returns on your investment in due time, properties that are worth investing in require a substantial down payment and other upfront costs such as improvements and repairs, as well as ongoing payments like property taxes, insurance, and more. 

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And while investing in the stock market can be as easy as signing up for an app, real estate investments take a substantial amount of your time, particularly if you’re new to the business, as there is a lot to learn when managing real estate investments, during which time mistakes can be very costly.

If you want to invest in real estate, you can be expected to be in it for the long haul, as the best way to invest in real estate involves taking advantage of a long-term strategy for maximizing profits. And while being a landlord seems to be an easy way to generate passive income, tenants can cause any number of problems, and sometimes even sue their landlords over disagreements about their living situation. To make matters worse, the law in many jurisdictions tends to favor tenants over landlords, as a tenant’s right to a suitable living environment is weighted against a landlord’s right to make money off their investment. For these reasons and more, it is essential to exercise good judgment and care when expanding your investment portfolio to include real estate, but managing properties successfully can be very profitable.