"Ilon's effect"

As one tweet of the founder of Tesla and SpaceX, can bring cryptocurrency and stocks of companies into space (even those with which it is in no way connected)

In recent years, the creator of Tesla and SpaceX, in recent years, is definitely enjoying his colossal influence on Twitter, where he has more than 53 million subscribers. With one careless tweet, he can drop or bring to the incredible level of quotation not only his enterprises, but also of other public companies. A couple of years ago, he had already incurred the anger of the US Securities Commission (SEC), which accused him of misleading investors, but this did not stop the businessman. Over the past six months, he switched from the stock market to the cryptocurrency industry and provoked an increase in the Bitcoin course by tens of percent - which quickly used the Tesla company, which at the end of April earned more than $ 100 million at the end of April. We tell you how Elon Musk learned to excite the stock markets with one tweet and bring the anger of the American regulator.

For the first time, Musk felt all the power of his twitter five years ago. Investors and ordinary buyers at that time were obsessed with the news about the development of the new model of the Tesla, Model 3 electric car - this car was supposed to become the most affordable model in the company's line. In June 2016, the American media began to disseminate that Samsung will be the supplier of batteries for Model 3, but the founder of Tesla decided to make clarity.

“I would like to clarify that the batteries for Model 3 Tesla are exclusively working with Panasonic. News materials, which are approved by another, are incorrect, ”Ilon Musk tweeted then.

After this statement, the Panasonic shares increased by 4 percent, and the capitalization of the entire company was about $ 800 million. At the same time, Samsung SDI papers - units of the South Korean Corporation Samsung to create batteries, batteries and displays - fell by 8 percent, as a result of which its market capitalization decreased by $ 580 million.

In fairness, the excitement around Tesla Model 3 was then so that almost any rumor about the details of its development gave rise to traffic in financial markets. Thus, the shares of the Taiwanese company Hota Industrial Manoufacturing, which was the only supplier of the Tesla electric boards, in April 2016 fell sharply after the news that Tesla was probably looking for another supplier.

Sale of Easter eggs

Two years passed, and on April 1, 2018, Musk decided to play its subscribers by publishing a Tesla bankruptcy series. “Despite the incredible efforts to borrow funds, including the desperate mass sale of Easter eggs, we regret that Tesla completely and irrevocably went bankrupt. It was so bankrupt that you can’t even imagine, ”the head of the company wrote .

The fact that this was a joke was quite obvious - in the next tweet Musk said that after these news he was found lying near Tesla Model 3, surrounded by bottles of Teslakila and with traces of dried tears on his cheeks. “This, of course, was not an official statement, so what's the point? Happiness in the new month! ”Musk finished his tirade.

Investors did not appreciate the joke at all, and the time for such speculations was chosen unsuccessfully - Tesla at that time really stormed. A month before comic tweets in California, an accident occurred with the participation of Tesla Model X. The car crashed into the chipper, as a result of which the driver died at the wheel. The causes of the accident were not established at that time, but rumors were distributed on the network that the autopilot became the fault of everything.

After a couple of weeks, Tesla was again in the center of the scandal-the company announced the recall of 123 thousand Model S electric cars due to possible problems with the steering amplifier. The company emphasized that any accidents did not precede this review, but the negative background could no longer be changed.

In addition, Tesla did not fulfill its own promises for investors: by the end of 2017, the company planned to produce 5 thousand Model 3 sedans per week, but did not cope and moved the terms for reaching this goal for six months. As a result, the Moody= rating agency lowered Tesla’s credit rating to B3 level and changed the forecast from stable to negative, which immediately entailed the drop in Tesla's quotations by 8.2 percent during the day.

Jokes about bankruptcy that appeared on such a restless background, Musk only excited investors, and according to the results of the auction on April 2, the shares of the automaker fell by another 5 percent. However, this was only the beginning-in the same year, because of the tweet, Musk lost the post of chairman of the board of directors of Tesla.

War in SEC

A few months after the unsuccessful first -April joke, Musk wrote about plans to withdraw Tesla from the exchange. “I am thinking of making Tesla a private ransom of $ 420 [for one security]. Financing is provided, ”Tesla founder tweeted . A huge bonus was laid in the indicated amount relative to the market price - at that time it was about $ 350, so after the statement of the Tesla quoted mask, they instantly rushed up.

The US Commission on Securities and the US Market could no longer transfer such a free handling of the financial market. A month after the publication, the SEC mask filed a lawsuit against him, citing the fact that he misled the investors with his tweet: there was no financing under this deal, and divisting was never carried out in the end.

In her claim, the SEC demanded to remove the mask from the post of chairman of the board of directors of Tesla and appoint two more independent directors there, create a new committee that will control and pretend all the public statements of the mask regarding Tesla and the company and the company of the total fine of $ 40 million.

“The package of legal protection funds was designed specifically to eliminate unlawful behavior and protection of investors by strengthening corporate supervision in Tesla,” said Stefani Avakyan, similar director of the security department. After a couple of months, the SEC and Musk concluded a settlement agreement: the entrepreneur had to agree with all the above requirements of the American regulator.

This story painfully hit Tesla in the financial market-from August to October 2018, the company lost about $ 12 billion. However, this did not stop the mask - he continued to ironize the situation on his Twitter : “I just wanted to notice that the commission for the enrichment of speculators [Shortseller Enrichment Commission or Sec] does incredible work! And the change in the name is in the subject! ” This tweet also did not go unnoticed - the price of Tesla shares on the same day fell by 5 percent and continued to decline for several more days. Despite this, Musk continued to kindle the scandal: in an interview with CBS, he said that “does not respect the SEC,” and no one is consistent with his tweets, despite the agreement with the SEC.

Such a bold statement was not left unattended: in February 2019, the SEC accused the mask of violating the terms of the settlement agreement after he, without prior consistent with Tesla lawyers, published on his twitter a forecast with distorted data on the production volumes of the company's electric cars. Ultimately, the SEC and Musk signed another agreement-it has a clear list of those by which the businessman should receive written approval by Tesla before publishing something in social networks.

Cryptopuses on the meme exchange

Musk made its contribution not only to the volatility of traditional financial markets - it also provoked a mass of excitement in the cryptocurrency market. At the beginning of 2021, the businessman often began to mention in his tweets the Dogecoin cryptocurrency created in honor of the DOGE Internet meme . At that time, Dogecoin cost a penny and was rather a tribute to memes than real money. However, Musk talked about the purchase of Dogecoin for his son, posted various memes, called Dogecoin the possible “future of the world of cryptocurrencies” and at the same time warned about the problems it had. The key problem of Dogecoin Musk considered the consolidation of most of the emission among a limited, very small number of cryptocurrencies, and urged large holders of this currency to sell their coins.

With the tweet of the mask, the rampant growth of Dogecoin began, which continues to this day. For example, on April 1, he joked that his company SpaceX would send Dogecoin to the moon - and on the same day the course of this cryptocurrency took a 20 percent. As a result, by the beginning of May, she pierced her historical maximum of $ 0.54 per 1 Dogecoin, and her entire capitalization amounted to $ 70.5 billion - the fourth largest cryptocurrency in the world is now Dogecoin.

And if only the son of the mask earned on Dogecoin’s height, then at the jumps in the Bitcoin course provoked by the businessman's tweet, his Tesla company was made a lot of profit.

In February, the manufacturer of electric cars unexpectedly notified the SEC about plans to purchase bitcoins in the amount of $ 1.5 billion and after a few days he closed this deal on the Coinbase Exchange. Against the background of these news, the Bitcoin course on the very first day increased by 13 percent and broke a historical maximum of $ 44 thousand per coin.

Musk called the storage of money in bitcoins “simply less stupid liquidity than savings in fiat currencies”, but claimed that the company’s actions still do not quite reflect his opinion.

“Frankly, I'm not an investor, but an engineer. I do not even own the securities of any public companies except Tesla. However, when the paper currency has a negative real profitability, only the fool will not look for something in return. Bitcoin is almost the same nonsense as paper money. The key word is “almost”, ” wrote Musk.

A month later, Tesla opened the opportunity to buy her electric cars for bitcoins - which again provoked the growth of the cryptocurrency course, this time up to 55 thousand dollars per coin. And a month later, the company unexpectedly sold 10 percent of its bitcoins - in the amount of $ 272 million, having received a profit of $ 101 million from this transaction. Musk claimed that Tesla sold part of the currency to “prove the liquidity of bitcoin as an alternative to storing money on the balance”, however, Twitter users still reproached him for a targeted batch of bitcoins, inflating their capitalization and then selling a currency at the peak.

"Ilon's effect"

The incredible influence of the tweet of Ilona Mask led to a pair of curious moments. In January 2021, against the backdrop of the upcoming change in the privacy policy of WhatsApp, Musk decided to recommend to its subscribers an alternative messenger - Signal, which is considered more secure and safe. He tweeted concisely: "Use signal."

Confusion or targeted manipulations of investors who decided to use the mask tweet, led to an increase in the shares of Signal Advance - a manufacturer of medical products that have nothing to do with the messenger of the same name. In three days, the company's securities have risen in price by more than 5,000 percent, and market capitalization reached 390 million dollars.

A similar situation was formed after Musk announced on its twitter on the Clubhouse social network - at that time an still little -known American startup. After that, investors rushed to buy shares of the Clubhouse Media Group of the same name and in a short time increased their price by 100 percent. The only problem was that this is not the same Clubhouse . The FINANCIAL TIMES publication has been condemned for such an impact on the market with the Ilon effect.

However, in some cases, subscribers understood the mask just half. At the beginning of this year, the businessman tweeted "Gamestonk !!" And he attached a link to the community of private investors on the Reddit forum, after which the Gamestop shares, which had already taken off by that time thanks to the efforts of private investors, jumped 130 percent.

Twitter manipulators

In most countries of the world, manipulations are pursued by law by law, however, for this, as a rule, it is necessary to prove that a person manipulated the prices of papers intentionally or, for example, used insider information. Nuriel Rubini, a professor of economics of New York University, has already stated that SEC should “look closely” at people like the head of Tesla Ilona Mask for manipulating the securities market.

At the same time, the mask tweet is far from the only example of how easy it is to be specially or unconsciously manipulated by the financial market. For example, in 2013, hackers hacked the Twitter account of the Associated Press agency and published fake news that US President Barack Obama was allegedly wounded during an explosion in the White House. Despite the fact that AP quickly took control of the situation and asked Twitter with a request to block the account, the enormous damage to the economy has already been inflicted: the S&P 500 index against this “news” fell by 0.9 percent, which instantly entailed a drop in 130 billion dollars.

In addition, Mask is not the only person who is able to raise and lower the price of shares with one tweet. At the end of 2019, the American bank JP Morgan considered that since the arrival of the White House in January 2017, President Donald Trump has published about 10 thousand tweets, of which 146 had an impact on the situation in the markets according to JP Morgan experts. After that, the bank created the Volfefe index, the name of which was a combination of the word "volatility" and the well -known typo of Donald Trump "COVFEFE". The bot, created by the specialists of JP Morgan Bank, analyzed more than 14 thousand Tvites of Trump and compared them with fluctuations in the stock markets, finding some words that affect the behavior of investors. Among them were “China”, “billions”, “tariffs”, “dollar” and “trade”. Bank experts believed that Volfefe Index will help investors predict the behavior of the stock market, depending on the use of a particular word-trigger by the American president.

However, sometimes in order to drop shares in one tweet, you do not need to be the president of the United States, but just a big fan base. So, in 2018, the TV star Kylie Jenner tweet that she did not like the new design of the Snapchat messenger. Immediately after this, the capitalization of Snap Inc., which owns the messenger, collapsed by 1.3 billion dollars.

Maria Kolomychenko