Common Cents:
Who will be our next Elon Musk?
In hindsight, America loved and needed Elon Musk more than Elon Musk loves Elon Musk. That’s saying something, because the love Elon has for himself may go down as one of the greatest “bromances” of all time.
Much of this adulation, certainly, is well-deserved. As a co-founder of PayPal, Musk created one of the foundations of e-commerce. Then he decided the economics of spacecraft needed some tweaking, so he learned how to build rockets from books and set out to make humanity a multi-planet species by colonizing Mars. While this is moving along, he starts an electric car company, mass-markets solar power and, through his ironically named Boring Company, is attempting to ease traffic congestion by digging tunnels for roads beneath Los Angeles. If I missed anything (other than his tumultuous personal life), forgive me.
Last week, Musk agreed to step down as chairman of Tesla and pay a $20 million fine after tweeting that he might take the company private at $420 once critics began to raise the possibility of Tesla being forced to file for bankruptcy. The Securities and Exchange Commission alleges Musk did not have the financing in place for such a move and even chose the $420 price as a not-particularly sly reference to the marijuana culture. The SEC action is on the heels of some additional odd behavior from Musk — smoking what appeared to be a joint during one interview and breaking down in another. He has referred to 2018 as one of the most difficult in his life. Though Tesla stock (TSLA) has rebounded from recent lows — at least as I write this — it’s still down significantly from its highs.
As I follow this unfolding saga, I also think about how desperate America seems for corporate supermen and superwomen. Steve Jobs is dead and Bill Gates has morphed into a philanthropist (and more power to him for that). There’s no arguing Jeff Bezos’s success at Amazon, but that has come incrementally enough that he’s been looking to make a splash with his own rocket company, Blue Origin. Mark Zuckerberg’s Facebook just got hacked (including Zuckerberg’s own account, allegedly) and, like Google, has been under fire for abusing user information.
You might be surprised at this point to know this isn’t a protest article. Instead, what occurs to me is that whenever there is a significant cultural shift of this magnitude in the United States, there can be a potential upside within the sectors being rewarded by the new business opportunities offered by said shift. There are also pitfalls out there for being on the wrong side of history. It appears to me we are in the middle of casting off old heroes and beginning to look for new ones, and those new ones seem to be just beyond the horizon.
Is it time to hide from the markets? No. But it is a time to stick to a tight investment policy and be very wary of yesterday’s hype.
Evan Guido is a resident of Parrish, Florida, and a Financial Advisor with Robert W. Baird & Co. Call him at 941-906-2829 or visit evanguidogroup.com. Robert W. Baird & Co. does not provide tax and legal advice.
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