Virgin births in animals are no longer rare - <AUTHOR> http://www.bbc.com/earth/story/20141219-spectacular-real-virgin-births <comment><USER2> I think what surprises me most about this is that the Boa produced only female offspring.

Per [http://en.wikipedia.org/wiki/ZW_sex- determination_system](http://en.wikipedia.org/wiki/ZW_sex- determination_system) \- humans have XY chromosomes, with XX female and XY male. Boas have ZW chromosomes, with ZZ male and ZW female. I'd expect parthogenesis to produce unviable WW offspring, and viable ZZ ones. But WW turns out to be viable, and ZZ either doesn't happen, or isn't viable.

I'd previously read about this happening in Komodo dragons, which also have ZW, and there the viable offspring were all male - which makes slightly more sense to me, genetically speaking, because the children can mate with the mother to get slightly more genetic diversity in their offspring.

Quick google, [http://www.plosbiology.org/article/info%3Adoi%2F10.1371%2Fjo...](http://www.plosbiology.org/article/info%3Adoi%2F10.1371%2Fjournal.pbio.1001643) might shed some light on this: in boas, the W and Z chromosomes look identical, in other species they look very different. That might (partially?) explain why WW is viable. But I'm way out of my depth here.

<comment><USER3> > Boas have ZW chromosomes, with ZZ male and ZW female. I'd expect > parthogenesis to produce unviable WW offspring, and viable ZZ ones.

If the female is ZW, then I'd expect three possible choices -- unviable WW, female ZW, and male ZZ -- because both Z and W are present in the female.

<comment><USER4> Apparently WW can be a viable female:

[http://news.bbc.co.uk/earth/hi/earth_news/newsid_9139000/913...](http://news.bbc.co.uk/earth/hi/earth_news/newsid_9139000/9139971.stm)

</comment></comment></comment><comment><USER5> Relevant Wikipedia quote [1] about New Mexico whiptail lizards:

 _An interesting aspect to reproduction in these asexual lizards is that mating behaviors are still seen, although the populations are all female. One female plays the role played by the male in closely related species, and mounts the female that is about to lay eggs. This behaviour is due to the hormonal cycles of the females, which cause them to behave like males shortly after laying eggs, when levels of progesterone are high, and to take the female role in mating before laying eggs, when estrogen dominates._

It blew my mind when I first stumbled upon it:

There's a species of lesbian lizards that reproduce by cloning!

[1] [http://en.wikipedia.org/wiki/Parthenogenesis#Reptiles](http://en.wikipedia.org/wiki/Parthenogenesis#Reptiles)

<comment><USER6> The way to tell if a cow is in heat, is when she stands still while other cows mount her in the same fashion a bull would. It isn't odd that very important behavior is at least partially determined by genes found on the other chromosomes.

</comment></comment><comment><USER7> I recall Josh McDowell citing the virgin birth as one of the defining reasons for believing Christ was the son of God.

I quite enjoyed Christopher Hitchens' take on Parthenogenesis: "Even if I grant you that, you still have all your work ahead of you to prove that he was divine."

Things like this add to that workload. Fascinating and festive and very HN.

<comment><USER8> The Hebrew word for young girl was very close to the word virgin, there was only a subtle difference in the spelling.

<comment><USER9> The new testament was written in Greek, not in Hebrew. And yes, back then, the word virgin could actually have allegoric meaning(young/innocent/beautiful/... girl). Imagine if she was actually the first ever mammal to asexually reproduce..

<comment><USER10> Yes, but the prophecy that Jesus fulfilled by being born of a virgin was from the _Old Testament_ (Isaiah 7:14), not the _New Testament_. (the Old Testament was written in Hebrew)

[https://www.biblegateway.com/passage/?search=isaiah+7%3A14&v...](https://www.biblegateway.com/passage/?search=isaiah+7%3A14&version=NKJV)

<comment><USER11> Yes, but Isaiah 7:14 wasn't originally written in English, and the Hebrew word "almah" didn't mean "virgin" in the Old Testament.

[http://en.wikipedia.org/wiki/Almah](http://en.wikipedia.org/wiki/Almah)

<comment><USER10> Well, in fairness (strictly going by that article) it didn't _have_ to mean "virgin" \-- but it sometimes did:

"Almah (עלמה, plural: alamot עלמות) is a Hebrew word meaning a young woman of childbearing age who has not yet had a child, and who may be an unmarried virgin or a married young woman."

I'm not saying that Wikipedia gets the final say here, just pointing out what the quoted article says.

</comment></comment></comment></comment></comment></comment><comment><USER12> As a non-bio person, I wonder what's the evolutionary reason for this not happening in more species. Sure, sexual reproduction is the way to go if you have the option, but wouldn't a wouldn't a mother capable of both asexual and sexual reproduction have higher chances of propagating her genes than a mother who is only capable of sexual reproduction. (I know I shouldn't be playing these mind games with zero knowledge of the subject, but I am curious)

<comment><USER13> _> I wonder what's the evolutionary reason for this not happening in more species._

There's rarely an "evolutionary reason" for a trait not developing. Wings would certainly be a net benefit to mice survival-wise; but unless there's a strong evolutionary pressure for such a trait to develop, it's unlikely to appear.

It's the same for asexual reproduction: unless there's a strong advantage for a species to reproduce asexually, it's likely not going to appear.

In other words, evolutionary selection is really about the strict minimum needed for a species' population to thrive; evolution selects, but it doesn't optimize.

You also have to account for things that are hard to predict: even though on paper it seems like asexual reproduction would lead to a higher chance of propagating genes, perhaps in reality the lack of diversity in the resulting offspring would be negative to the species' survival (or while it sounds like mice developing wings would be an advantage, in reality the energy needed to develop wings would make it a survival disadvantage).

An interesting case were these rules are "suspended" are in closed ecosystems where certain species have no predators and plenty of sustenance; e.g. paradise birds in pacific islands, which can develop completely superfluous feather patterns and attributes at no evolutionary "cost".

<comment><USER12> >>unless there's a strong advantage for a species to reproduce asexually, it's likely not going to appear.

I was under the (perhaps wrong) impression that asexual reproduction predated sexual reproduction in the history of life (prokaryotes predating eukaryote?) so I always thought that organisms "lost" the trait of asexual reproduction somewhere down the line. Probably an assumption without basis.

>>perhaps in reality the lack of diversity in the resulting offspring would be negative to the species' survival.

Yes. I imagine the answer would be something like that, but the question of what is the exact reason still stands.

Like i said I haven't the foggiest idea of the subject matter but always liked to think and speculate about it. Origin and Nature of Life, Physical nature of consciousness and Neuroscience in general are all topics I find fascinating. If anybody know any popular science books they can recommend on any of these topics, it would be great.

<comment><USER13> Dawkins' books, especially the earlier ones (e.g. Blind Watchmaker), are quite a good and gentle introduction.

Yes, you are right that life originally started as asexual reproduction and sexual reproduction appeared later; my answer was more about the likelihood of a species that already reproduces sexually moving towards asexual reproduction.

Regarding the question of why the asexual->sexual shift happened in the first place, the wikipedia article on asexual reproduction has this to say:

 _Current hypotheses [2] suggest that asexual reproduction may have short term benefits when rapid population growth is important or in stable environments, while sexual reproduction offers a net advantage by allowing more rapid generation of genetic diversity, allowing adaptation to changing environments._

<comment> rational-future >> Yes, you are right that life originally started as asexual reproduction and sexual reproduction appeared later

No, that's a hot research topic.

E.g. a popular hypothesis is than in an RNA world very early and simple organisms had inefficient metabolism and error-prone genetic copy. They didn't have enough energy to sustain a backup of their genetic information, RNA is not very stable, etc. So the only way to keep functioning was to constantly mate with other organisms and exchange good replacements for broken genes.

</comment></comment></comment></comment></comment><comment><USER4> Heh, what an appropriate theme for Christmas :)

</comment><comment><USER14> [https://en.wikipedia.org/wiki/Marmorkrebs](https://en.wikipedia.org/wiki/Marmorkrebs)

</comment><comment><USER15> This is nothing new. Lizards reproduce asexually in deserts often when the conditions become extremely stable--no new genetic info is needed. One day the whole world, once we've learned how to control it, will become female, or at least ones that can change into male if they wish. [http://www.scientificamerican.com/article/asexual- lizards/](http://www.scientificamerican.com/article/asexual-lizards/)

</comment><comment><USER16> I have my own terrarium inside the home with everything enclosed from outside. It includes LED lighting.

Somewhat Aphids appeared and created havoc inside. They reproduce in so many different ways, sexually, asexually or mixed that is really hard to eradicate them(in a natural way).

In the end I decided to use ladybugs to control them. Now I need something that controls ladybugs too.

<comment><USER17> Be careful, that is a long road to go down...

[http://www.amazon.com/If-You-Give-Mouse- Cookie/dp/0060245867](http://www.amazon.com/If-You-Give-Mouse- Cookie/dp/0060245867)

</comment></comment><comment><USER18> Ah, apparently the BBC forgot about the scene in the first movie _Jurassic Park_!

<comment><USER19> Why was it downvoted? It is in some way relevant.

I remember in Jurassic Park 1 the premise was that the dinos reprocuded themselves because the contained parts of an African frog DNA, a species that needs only females to reproduce.

<comment><USER18> Right. As in the script of _Jurassic Park_ at

[http://www.imdb.com/title/tt0107290/quotes](http://www.imdb.com/title/tt0107290/quotes)

early in the movie we have a discussion saying that the animals can't breed in the wild due to them all being female:

"John Hammond: [as they gather around a baby dinosaur hatching from its egg] I've been present for the birth of every little creature on this island.

Dr. Ian Malcolm: Surely not the ones that are bred in the wild?

Henry Wu: Actually they can't breed in the wild. Population control is one of our security precautions. There's no unauthorized breeding in Jurassic Park.

Dr. Ian Malcolm: How do you know they can't breed?

Henry Wu: Well, because all the animals in Jurassic Park are female. We've engineered them that way."

and later with three of the characters wandering in the park we have

"Dr. Alan Grant: [finding egg shells] Oh my God. Do you know what this is? This is a dinosaur egg. The dinosaurs are breeding.

Tim: But Grandpa said all the dinosaurs were girls.

Dr. Alan Grant: Amphibian DNA.

Lex: What's that?

Dr. Alan Grant: Well, on the tour, the film said they used frog DNA to fill in the gene sequence gaps. They mutated the dinosaur genetic code and blended it with that of a frog's. Now, some West African frogs have been known to spontaneously change sex from male to female in a single sex environment. Malcolm was right. Look..."

So, yes, the movie anticipated the OP from the BBC.

</comment></comment></comment><comment><USER20> I can imagine the title of the next bbc article -- "Eloquent speech by a 3 months old middle eastern Homo Sapiens is no longer rare".

</comment><comment><USER21> More proof of our One True Lord:

[https://www.youtube.com/watch?v=unZI3MVIZ4o](https://www.youtube.com/watch?v=unZI3MVIZ4o)</comment>


The Coronavirus Pandemic Turned Bill Gates into a Fake Villain - <AUTHOR> https://www.buzzfeed.com/ryanhatesthis/coronavirus-bill-gates-conspiracy-theories <comment><USER2> Believe it or not back in the 90s there was arguably even more hatred towards Gates than there is now. There was an entire subculture devoted to figuring out how "Microsoft" meant "666" using some sort of numerology.

<comment><AUTHOR> The fact he got a supervillain modelled after himself in Despicable Me doesn't help much. ;-)</comment></comment>


iPhone 7 Camera Review: Rwanda - <AUTHOR> http://austinmann.com/trek/iphone-7-camera-review-rwanda <comment><USER2> > Note: It does find "dog" with no problem, but it does not yet find > "gorilla."

This is probably intentional, to avoid embarrasing false-positives: [http://www.bbc.co.uk/news/technology-33347866](http://www.bbc.co.uk/news/technology-33347866)

</comment><comment><USER3> This is a great review to see how pictures turn out in real-life but there is absolutely no scientific method or objective measure in their efforts.

You need a standard to compare things.

I stopped watching at "With the new release of telephoto lens, what is the best location to test it? Africa". That makes zero sense to me.

<comment><USER4> There are and will be plenty of reviews with in-depth comparison shots. Ars Technica already has a few and I'm sure there will be more to follow. This however is something quite different which makes it a great review.

<comment><USER3> They could have done iPhone 6s vs. iPhone 7 photos, side-by-side but they didn't.

I can't tell if the camera is great or the pictures look great because of the location. What is the point of this review?

It should be titled "iPhone 7 sample photos & videos taken at a spectacular location."

<comment><USER5> The point of the location is to make it interesting. Sure, he can go out in any local town and take a bunch of photos of normal stuff, but that would be pretty boring. This type of review is meant to both test the hardware, and be an interesting adventure / trip. You see them frequently switching between 1x and 2x, which I spent a lot of time rewinding and re-watching as someone who does a lot of travel photography through only my phone.

Let them have some fun...

</comment></comment></comment></comment><comment><USER6> That is some seriously seriously ugly bokeh in the image of Mariyane. As someone who has won three emmys for production, I would never present an image like that. The dynamic range however, is really great.

<comment><USER7> Agreed. That's the kind of image that will be greatly enhanced by the faked software bokeh coming in a software update soon.</comment></comment>


US workers may have to change social media use as firms adapt to China's rules - <AUTHOR> https://www.cnbc.com/2019/10/08/social-media-use-could-change-for-americans-after-chinas-nba-shutdown.html <comment><USER2> In two words: bite me.

there aren't too many things that i'm a raving aboslutist about, but the freedom of political speech is one of them.

If my employer attempts to step on my neck for saying things about china that china doesn't like, on my time, and my personal accounts, their next contact from me will be from an ACLU lawyer.

<comment><USER3> AFAIK, political speech is not protected against employer discrimination.

<comment><USER4> That's honestly part of the problem.

Increasingly, every single right that we have that was enumerated in the Constitution and the Bill of Rights has been encroached upon by the government via workarounds and loopholes (see: Commerce Clause).

<comment><USER5> Government encroachment of these rights has always been a problem, but the real issue is that America tries to nurture two systems within itself: a liberal, democratic government with correspondingly enshrined rights and an economy arranged around authoritarian hierarchies with no such protections.

While it's all well and good to prevent the government from quashing speech and other rights, when your boss can fire you for saying something they disagree with or if you refuse things like workplace surveillance (potentially costing you your housing and healthcare in the process), these protections seem pretty threadbare. I think we need to do more to check the authoritarianism of our economy if we have any real aspiration to adhere to them.

</comment></comment></comment></comment><comment><USER6> Name and shame companies who bow to Chinese censors

[https://github.com/caffeine- overload/bandinchina](https://github.com/caffeine-overload/bandinchina)

(Repo named after south park episode)

<comment><USER7> I think you might be the owner of the repo so I'd suggest here instead of there.

I think this could be a wikipedia page, and sources could be added.

<comment><USER8> This would be an excellent Wikipedia page. Fantastic idea!

</comment></comment></comment><comment><USER9> Before we were voicing everything on the Internet there was both a separation between professional lives and private lives and far more localized communities that had lower interaction with each other.

With the way many are using the Internet is blurs or removes the lines between private and public along with removing regional group barriers.

So, I used to be able to run my mouth locally on some topic and have no work or global repercussions. Now, you do that on the Internet, it could be seen be people thousands of miles away, and it could impact ones career.

It's not just technology but how we choose to use it and guide others to do so as well.

<comment><USER10> In practice, most people can still enjoy a degree of separation unless they're in a relatively public role and/or haven't tried to separate their personal and professional personas on, e.g., Twitter.

That said, the walls between personal and professional can break down in a big hurry if some ill-considered (or just unconventional) remark/action/etc. goes viral. Companies will cut their connections with most individuals very quickly if that's the easiest and least embarrassing response to an online mob.

<comment><USER11> We need to be a bit more accurate though so that we can concentrate minds on solving the real problem. From what I can see, companies are not "embarrassed", they are "afraid".

They don't care about online mobs, they care about the drop in revenue that will come from lost business. Reputations that take years to recover impact revenues for each of those years. That's the issue.

If we could think of a way to insulate companies from lost revenue, the problem could be solved. To date, there have only been clumsy, amateurish attempts to do this. Actions like, telling everyone, "Hey, go spend your money with this company!" Which for a lot of reasons rarely, if ever, works. We have to come up with something that would provide decision makers at these firms more certainty.

<comment><USER10> I'm not sure how you even go about "insulating companies from lost revenue" though. The online mob may not be responding rationally (or in a way you agree with) but groups of people certainly have the right to publicly denounce and call for boycotts of a company.

Which, as you say can be damaging to their brand and ultimately their revenue, ability to hire people, etc. The fact is that the path of least resistance to mitigate and close out the damaging outcry as quickly as possible is often to apologize, fire someone, make some harmless concession, etc.

</comment></comment></comment></comment><comment><USER12> The only thing that is going to stop this is when these companies start losing money. They would sell their first born if they thought it would increase their stock prices.

I would boycott these companies but to be honest I don't have any accounts with them in the first place and I am actively closing accounts and reducing my presents on the internet.

<comment><USER13> > reducing my presents on the internet.

Presence?

Though I also agree that you shouldn't have presents on the internet, either.

<comment><USER12> Yep, that's the one. I think that is one of those words that I always use wrong until someone points it out.

</comment></comment></comment><comment><USER14> How long is it going to be before someone sets up a betting service on which companies will bend the knee fastest?

</comment><comment><USER15> Protections from government influence on free speech is a fundamental American cultural value. Just because it's a foreign government doesn't mean we shouldn't continue to abide by that value.

</comment><comment><USER16> While companies should be held to account for caving to economic pressure, and boycotting them is justified, I think it's important to recognise that this pressure exists, and for all companies, not only those yet to have an infamous PR incident.

It is the responsibility of government to counteract such pressure and protect business from becoming proxy to foreign interference in domestic political discourse, not to mention protecting such discourse in itself.

</comment><comment><USER17> I remember when news used to tell you about things that _did_ happen instead of things that might happen.

Until a company actually does this, this is just clickbait speculation.

<comment><USER18> Does Blizzard's muzzling/suspension of a Hearthstone tournament player count? Sure, the player isn't an employee, but essentially earns money by playing.

[https://news.ycombinator.com/item?id=21190265](https://news.ycombinator.com/item?id=21190265)

<comment><USER17> Not really. Blizzard cites a specific rule that all the tournament players agree to that allows them to do that. Most employees don't have any such agreement with their employer.

Even so, with at-will employment, employees have _always_ been subject to being fired for saying something controversial on social media, so this is nothing new.

<comment><USER19> I mean there will always be legal excuse.

Corporations hr departments have firing down to a fine art.

</comment></comment></comment></comment><comment><USER20> They can bite me as well. This a foreign nation exerting its will over our politics via economic control. The govt should make strides to curb this imo.

<comment><USER21> Hopefully tariffs and sanctions convince them to back off. This kind of commercial censorship is arguably a trade infringement that can be responded against in kind.

</comment></comment><comment><USER22> Neither Beijing nor my employer get a say in what I post online, whether it concerns the resemblance between Xi Jinping and Winnie the Pooh or the true paternity of Jesus H. Christ (my money is on Zeus).

</comment><comment><USER23> If Apple has "removed" the Taiwanese flag now, soon maybe they'll automatically translate what people say into NewSpeak which is acceptable for the China market. Just saying...

</comment><comment><USER24> The title of this article is designed to trigger the target audience before they even open the link.

<comment><USER25> Agreed. There's really no new information here, just that a reporter got someone from an institute to speculate on corporate social media policy.

<comment><USER26> "speculate"

</comment></comment></comment><comment><USER27> At some point there will have to be a confrontation with China over its tyranny.

<comment><USER28> This is not Chinese tyranny, this is the American tyranny called at-will employment.

</comment></comment><comment><USER29> Or maybe we should start standing up to an authoritarian regime.

oh wait, capitalism. Nevermind. Let's pander to them instead.

</comment><comment><USER30> > _Cathay Pacific CEO Rupert Hogg stepped down after one of the airline's > pilots was found to have taken part in the protests._

Wow, that is crazy.

<comment><USER31> They asked him for a list of employees who participated, and he sent them a list with 1 name: his own. Resigned immediately after. It was a badass move.

<comment><USER32> Badass move from a badass man with a badass name.

I can't seem to find any indication that it actually happened, though. You happen to have a source? I'd love to read more about the badass that is The Hogg.

<comment><USER31> [https://www.newsweek.com/cathay-ceo-refused-name-hong- kong-p...](https://www.newsweek.com/cathay-ceo-refused-name-hong-kong- protesters-chinese-government-named-himself-instead-resigned-1455371)

[https://www.ibtimes.com/cathay-pacific-ceo-praised-not- givin...](https://www.ibtimes.com/cathay-pacific-ceo-praised-not-giving-names- staff-joining-hong-kong-protest-2815487)

<comment><USER33> You provided two links which both reference the same news source, which cites their source as

> One of the first netizens to share this news, David Ng, a student at the > Education University of Hong Kong, told Taiwan News that this information > came from a trusted source who works as a manager for Cathay Pacific Airways

<comment><USER31> Not sure what you want from me, I don't have internal company memos or anything. I'm just sharing what I read in news articles.</comment></comment></comment></comment></comment></comment>


Show HN: An API for "where are you now?" - <AUTHOR> http://pinlogic.co <comment><USER2> Super interesting, especially if this makes it easy to share your location via any app. How does the API work? Is there a cost for developers? What is your vision regarding distribution?

<comment><AUTHOR> The API is essentially taking a crude geolocation processes and refining it into something more useful. It shouldn't cost anything until the usage gets quite high. We're aiming to have it embedded into breakdown/delivery/emergency job management systems.

</comment></comment><comment><USER3> Interesting concept. Does it require the receiver to have google maps (or similar play services) installed to view locations or is it entirely browser based?

</comment><comment><USER4> Is it a once off connection with the deliver company or can they get your location a number of times after the initial contact?

<comment><AUTHOR> Only with the user's consent, if the user refreshes or revisits the URL they will resubmit a fresh location.

</comment></comment><comment><USER5> Interesting. What pain does it solve?

<comment><AUTHOR> It essentially replaces telling someone verbally where you are. For breakdown assistance they can now get the customer's exact location without that person needing an app or trying to describe their location. The same goes for delivery or emergency.

<comment><USER6> Not needing an app to share location to a requester is cool. I didn't immediately get that this was what the app was for either - the fact that the user doesn't need an app is hidden from the frontpage under the 'more' link. I think if I wasn't motivated to find out what this was for I would have just skipped on to something else. Would suggest amending the frontpage so that users are bashed over the head with this right from the get-go.

</comment></comment></comment><comment><USER7> Really wish the guy delivering my takeaway last night used this API.

</comment><comment><USER8> Hi, Sounds great. How easy is it to integrate into my existing code?

<comment><AUTHOR> Very easy! You just need to make a Http request to our server. You'll need a web hook to receive a location (or you can get it sent to an email address for testing)

</comment></comment><comment><USER9> Very cool - nice one Pin Logic team!

</comment><comment><USER10> How does pricing work

<comment><AUTHOR> If you're referring to the credits, 1 credit is a single API call, 50 credits for an API call including an SMS send (as it costs more). So the free tier should have ample credits for some decent testing or even for production (5000 credits). See pinlogic.co/pricing for more</comment></comment>


SEC Sues Musk and Seeks Ban for His Tweets on Go-Private Deal - <AUTHOR> https://www.bloomberg.com/news/articles/2018-09-27/elon-musk-is-sued-by-securities-and-exchange-commission-docket-jml0doi2 <comment><USER2> This comment I made a few weeks ago is coming alot closer to the truth than I would have expected.

I hope for Space X and Tesla's sake that the reports of a directory and Executive ban don't come true.

[https://news.ycombinator.com/item?id=18016250#18016292](https://news.ycombinator.com/item?id=18016250#18016292)

SpaceX is doing well, Tesla has pulled itself back from the brink and may actually become a profitable car company.

All Elon had to do was keep his head down and not pick twitter fights....

 __EDIT __one thing I should point out is that some people have questioned if the tweet had any adverse affect at all on the shorts, given that the stock is down now.

The answer is hell yes and the fact that the stock ash gone down since the tweet only strengthens the shorts case.

The reason is that when you are short the biggest issue you have is that the stock could go against you, in this case that means it could go up. So to guard against that you generally have a price level in which you would exit the trade.

So when Elon tweeted, a whole whack of shorts got stopped out, intentional or by their risk limits. Infact there is a lawsuit already filed by Citron due to this. That momentary bump, while short lived was more than enough to close out some short positions.

If he's found to be in the wrong here by the SEC, then it seems like it wouldn't be too hard to find him guilty in the coming lawsuits.

<comment><USER3> I'd hope the company itself would be fine. I really hate this idea of the grand visionary. A good friend of mine who is a mechanical engineer despises Musk.

I listened to a bit of his Joe Regan interview and when Regan asked him how he has the time to do all of the things he does, there are smoke jokes about him being an alien, but not once did he say, "Well I have an amazing team of engineers" and credit all the thousands of people in his organizations that actually do the work.

He made it sound like he just constantly engineers things, but I find it hard to believe that at any point he's sitting down with CAD and fluid dynamic applications and mapping out experiments for rocket prototypes. I don't doubt he's capable of doing that with his background (or learning how to do it) but it's much more likely there is a whole team of really dedicated experts that he just leaves uncredited.

Are Apple products different now that Jobs are gone? One could argue that, but the core people that make and design all their overpriced, planned obsolescence devices are still there, often uncredited, while everyone else likes to focus on the captain of a ship.

<comment><USER4> _Are Apple products different now that Jobs are gone?_

Yes. Jobs as local despot acted as a curb to bad decisions. Jobs had a vision which acted as a countervailing force to keep Apple from being completely sucked into being a money grubbing luxury goods company.

 _the core people that make and design all their overpriced, planned obsolescence devices are still there, often uncredited, while everyone else likes to focus on the captain of a ship._

We know from the historical record that Jobs had quite good judgement, even in technical fields, and we know that he countermanded and convinced executives and managers to steer them in the right direction. I suspect that the Apple of today is descending into being just a money-grubbing luxury goods company.

<comment><USER5> This is just revisionist history and completely wrong.

Steve Jobs pretty much set Apple on the premium goods track when he returned. The iMac, iPod, iPad, iPhone were all developed under his watch and all were premium priced.

Apple has pushed the margins higher but that's only because the market can absorb it. Computing is more central to people's lives and they are willing to pay a premium for a good experience.

<comment><USER6> I've started to think Apple is more competitive on laptops than it looks from the price.

Every time I've priced out a laptop with similar configuration to my MBP (including a good-quality display, NvME SSD, good battery life), it always ends up costing about the same as an MBP. And then Apple's customer service definitely tips in their favor (I've been spoiled by fast, convenient, competent repair service at the Apple store).

So either everyone is making big margins on well-configured laptops, or the perception of over-priced MBP's is misplaced.

<comment><USER7> I was just commenting to my wife how remarkable I find it that my 2012 Macbook Pro 15 Retina is meeting all my needs as a software consultant. I used to think 3 years, maybe 4, was the useful lifespan of a high-end machine for daily professional use. In a few months it'll be 7 (seven) years old. It has 3 or 4 dead pixels, but everything else about it is working flawlessly. Maybe they don't make em like they used to, but man have I gotten my money's worth out of this one.

<comment><USER8> I'm posting this from a Macbook Pro I bought in November 2008. My family uses it daily.

My daily work computer is a 2012 Macbook Air which I dropped from a standing height 4 years ago. It has one bent corner but still runs great.

<comment><USER9> I still have iMacs from 2007 that are being used by my kids. I only upgraded the HDD to SSD a couple of years ago and they work flawlessly. No viruses, no tech support needed for 10 years.

That is just amazing hardware, but on the other hand, I have a pair of AirPods that just can't autoconnect to my MacBook unless I fiddle with the Bluetooth and speaker icons in the toolbar every time. And AirPods were fucking expensive and both are produced by Apple. What gives? How can they be so incompetent in making a wireless device connect to another wireless device?

<comment><USER7> Yeah Bluetooth sucks, and this is compounded by Apple's subpar BT handling in macOS.

That said, my Sennheiser HD1 headphones are absolutely amazing, and I don't miss being physically tethered to my laptop.

</comment></comment></comment></comment></comment></comment></comment></comment></comment><comment><USER10> He definitely lost it. And it's going to cost him. This is an open and shut case against Musk. He definitely sent out that tweet. Yes, maybe just not enough sleep and too many drugs. Not a good excuse.

Tesla might do better with a new CEO. They're past the vision stage. Tesla's problems today are all those of running a big auto plant.

Musk might do better focusing on Space-X.

<comment><USER11> Elon Musk has always had a disdain for the responsibility of running a public company, it seems perfectly reasonable that he tweet, in exasperation, that he wishes to make the company private. Why do so many people in this thread want the only guy making (rockets && green cars && batteries && solar && ...) to fail so badly? The guy smokes weed once on camera, now he's a witch and needs to be hunted down? We care about the wrong things.

<comment><USER12> Why they want him to fail badly?

They're maliciously envious - which is the product of an overly good self- image colliding with reality. They wish him harm because if he fails, he'll no longer remind them that that's how it looks like to actually achieve something.

<comment><USER13> Who are "they"? Anyway I can think of two parties: short sellers, who actively bet on Tesla shares losing value - and who are very likely behind all the negative press about Tesla, including making sure every accident a Tesla ends up in (especially if it's down to autopilot or involves fire or a death) stays in the news for weeks if possible.

The other would be competing car makers, who only now are starting to realize that electric cars are the future, except they're 5-10 years behind Tesla. I'm sure they'll catch up soon enough, given how they're much better at mass production than Tesla is atm, but they're way behind. Tesla will probably pivot to focus on their other endeavours - batteries (building the largest battery factory in the world), charging stations (building the largest charging station network in the world), green energy (solar panels and large scale battery storage), etc.

<comment><USER12> Short sellers and competitors have a financial reason to not like Musks success. Average Joe does not and still there are enough of them hating him and/or begruding his success. It's "them" that I was talking about.

</comment></comment></comment></comment></comment><comment><USER14> I think there's a bit of overexcitement going on in this thread; it doesn't look to me like Musk is going to jail on this one.

This part is interesting:

> The SEC had crafted a settlement with Musk that it was preparing to file > Thursday morning, the Wall Street Journal reported, citing unidentified > people familiar with the matter. Musk's lawyers called SEC lawyers to say > they were no longer interested in proceeding with the agreement, it said.

If his lawyers had a settlement lined up, and then retracted it, that means that they are confident they can win a better outcome in court. The deal they were going to cut did not involve Musk going to jail, so the outcome that Musk's expensive lawyers are betting on by retracting the settlement presumably also doesn't involve that.

<comment><USER15> Part of the deal was that he step down as CEO. I think that was not acceptable to him. Ultimately, I believe he will lose. A strong operator to handle traditional car company problems will make TSLA sky rocket

<comment><USER16> Source pls?

<comment><USER15> Faber just said on CNBC the settlement was couldn't be chairman for 2 years, add a couple independent directors, and pay a personal fine. I initially heard "step down"... But it seems just from the board for a couple years

</comment></comment></comment></comment><comment><USER17> He was trying to bankrupt the short-sellers, and he was doing it by lying: the price would soar, their options would be called, and they'd lose their shirts, all for a lie. When you're head of a public company, that's a crime. Not only will the SEC come after him, but the short sellers can probably sue him too. I have huge respect for his engineering ability, but he has messed up badly. He's overextended and it seems his conduct lately shows that he's melting down from overwork.

<comment><USER18> > He was trying to bankrupt the short-sellers, and he was doing it by lying

I'm out of the loop - can you point me to some proof of this?

<comment> village-idiot The actual complaint includes a few tweets by Musk warning shorts to get out within a specific timeframe.

<comment><USER19> So they were warned of possible actions that might cost them, like going private.

Damn if you do, damn if you don't.

<comment> village-idiot Yeah, but he wasn't actually going private. He did not follow any procedure to do that (casual talks without firm agreements don't count).

What it does do is establish a plausible motive for stock manipulation, which is a problem for a jury trial.

</comment></comment></comment></comment></comment><comment><USER20> The book The PayPal Wars: Battles with eBay, the Media, the Mafia, and the Rest of Planet Earth, details Musk's time at Paypal and pretty much describes him as an eventual hindrance rather than a help. He was eventually ousted from the company. Peter Thiel was the one that was able to nurse the company to success.

He was vital to get the company started but eventually, he was difficult to work with. Looks to me that history repeats itself. He's a great visionary but that does not translate to a great CEO.

He needs to get a new CEO at Tesla and focus on another company where I'm sure he'll make a great impact. He truly has great vision but the everyday minutia of running a company probably irritates and bores him.

<comment><USER21> I can only think of Elon as the only person to create THREE multi billion dollar companies in wildly different industries.

Elon is a fantastic CEO AND visionary. I personally know people who could be making double specifically work at spacex because they believe in his vision. Elon is able to get Supreme talent and productivity for pennies on the dollar. He's able to market Tesla and spaceX to billions with such a positive favoriability unlike anything we've ever seen. SpaceX and Tesla don't have a marketing budget because of Elon. Car companies spend billions marketing, Elon tweets saving billions for Tesla which he reinvests in r&d.

The entire world will lose if Elon is forced out. He's the biggest fighter for climate change and space travel in modern history, greater than Al Gore in marketing and execution, greater than Buzz Aldrin, Tyson, and cosmos. I'd much rather have an honest relatable Elon Musk than a suit. I'd rather have creativity than suffocating structure.

Elon is a great CEO. I would pick him over almost anyone alive.

<comment><USER22> To be fair, Musk created neither Tesla nor Paypal.

<comment><USER21> Well he turned Tesla into a multi billion dollar behemoth in a short time and revolutionized the electric car industry. He didn't create Tesla but he did "create" Tesla the billion dollar company.

PayPal is more complicated agreed. Elon's portion of it might be a billion due to inflation? But regardless he set the basis for it.

</comment></comment></comment></comment><comment><USER23> I very much hate to see this. Not for Musk's sake, as he has been pretty much asking for something like this to happen. I hate it because of the damage it will do to Tesla and SpaceX when he's likely banned from leading a company.

Tesla's not exactly lighting the world on fire in terms of potential long term success, but SpaceX really has been doing well in recent years. The fact that they are already refurbishing solid rocket boosters is a BIG deal. Losing a CEO is a very turbulent thing, and this will only set back their progress towards affordable space flight. I hope both companies are already grooming a suitable replacement.

<comment><USER24> > I hate it because of the damage it will do to Tesla and SpaceX when he's > likely banned from leading a company.

He would only be banned from leading a public company; SpaceX is still private (and, heck, maybe he could realize his plan of taking Tesla private, too.)

So, SpaceX wouldn't be directly effected.

<comment><USER25> SpaceX could be affected by him losing his security clearance for illegal drug use though.

<comment><USER26> So US interests could be harmed by damage to an important US company, itself entirely due to backwards US drug policies? I don't think Musk is the problem in that case...

<comment><USER27> Yes, because he showed such amazing judgment. It's obviously the law that's messed up.

<comment><USER28> It obviously is. Countless billions of dollars wasted and millions deprived of their freedom for what? Prohibition will go down in history as one of the biggest mistakes of our time.

</comment></comment></comment></comment></comment></comment><comment><USER29> Does anyone else find it amazing that these days social media posts are becoming official government documentation? Who would've thought that the very platforms where we once just shared pictures of cats are starting to run our our elections and stock markets.

<comment><USER30> Tesla made it easy for them. From the SEC filing:

> 13\. On November 5, 2013, Tesla publicly filed a Form 8-K with the > Commission stating that it intended to use Musk's Twitter account as a means > of announcing material information to the public about Tesla and its > products and services and has encouraged investors to review the information > about Tesla published by Musk via his Twitter account.

<comment><USER31> >Musk's Twitter account as a means of announcing material information to the public about Tesla and its products and services

I do not understand why he did not hire a PR firm to run his Twitter given the high stakes of each of his tweets. This is really bad judgement on his part.

<comment><USER30> I had the exact same thought. Probably a lot of ego and hubris was involved.

</comment></comment></comment></comment><comment><USER32> The actual complain: [https://www.documentcloud.org/documents/4950588-SEC-v- Elon-M...](https://www.documentcloud.org/documents/4950588-SEC-v-Elon- Musk.html)

<comment><USER33> PDF: [https://assets.documentcloud.org/documents/4950588/SEC-v- Elo...](https://assets.documentcloud.org/documents/4950588/SEC-v-Elon- Musk.pdf)

</comment></comment><comment><USER34> SEC wants to remove him from the head of the company: [https://twitter.com/kadhimshubber/status/1045407900259295233](https://twitter.com/kadhimshubber/status/1045407900259295233)

<comment><USER35> Are there any previous examples of someone doing something similar to what Musk did and the punishments they received? I don't normally follow SEC cases, but this seems like a pretty extreme potential punishment compared to the slap on the wrist that many people were predicting.

<comment><USER36> Yes. SEC litigation releases, press releases, report major updates to cases including the resolution. Here is a Google search for "prohibited acting officer", the key legal phrase/keywords, on the relevant section of the SEC website.

[https://www.google.com/search?q=prohibited+acting+officer+si...](https://www.google.com/search?q=prohibited+acting+officer+site%3Awww.sec.gov%2Flitigation%2Flitreleases)

<comment><USER35> I was asking what the punishment is for similar crimes and that isn't the same as asking for what crimes have caused a similar punishment. I looked through the first few results on that page and they all seemed, in my opinion, to be more severe crimes than what Musk is accused of doing.

<comment><USER36> Add "misleading" to the search and the first few results seem similar to what Elon did. Making public, false, and misleading statements to investors is something the SEC gets pretty upset about.

[https://www.google.com/search?q=misleading+prohibited+acting...](https://www.google.com/search?q=misleading+prohibited+acting+officer+site%3Awww.sec.gov%2Flitigation%2Flitreleases)

<comment><USER35> From the first result [1]:

>In its August 28, 2012 Complaint, the Commission alleged that, between 2005 and 2008, Wwebnet, Inc., a video software company, and Kelly made false and misleading statements and omissions to investors, including...

The accusations there are repeated and occurred over the course of several years. Musk has been accused of a single case of wrong doing. Musk's seems to be a much lesser crime. Also by still including the punishment in that search you are missing any similar accusations that received lesser or more severe punishments.

[1] - [https://www.sec.gov/litigation/litreleases/2015/lr23177.htm](https://www.sec.gov/litigation/litreleases/2015/lr23177.htm)

<comment><USER36> The answer to your original question is "yes". The SEC does not like when CEOs make misleading statements even once. All I did is point you in the right direction. I am not going to go through 100s of cases to find something that is exactly like the Elon Musk case for you. You are welcome to change the Google search yourself.

<comment><USER35> You are obviously under no obligation to do research to answer my question. I wasn't expecting anyone to spend time reviewing hundreds of cases to answer my question. I frankly don't care enough about the answer to review hundreds of cases myself. I simply proposed a question towards anyone who is more familiar with SEC punishments than I am. However, if you are going to answer my question I think it is fair for me to debate the validity of that answer.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER37> I'm perplexed how Musk could act without thinking of the consequences? Now I fear that he will be banned from SpaceX as well, when you are convicted of fraud by SEC, it will impact your duties at other companies.

It takes decades to build a reputation but it can be destroyed overnight with a single tweet.

<comment><USER38> The guy hasn't been sleeping and short sellers had essentially all but cornered him to the extent he would go bankrupt. I don't blame him too much except that he hasn't got his #2 with whom he can vent out, calm down and strategize. Gates had Ballmer, Page has Brin, Zuck has Sanders. Who does Musk has? Not acquiring #2 is his single biggest failure.

<comment><USER39> He absolutely has one in Shotwell on the SpaceX side.

Maybe that's part of the reason that Tesla is the company causing him all the issues.

</comment></comment></comment><comment><USER40> CNBC article: [https://www.cnbc.com/2018/09/27/tesla-falls-4percent-on- repo...](https://www.cnbc.com/2018/09/27/tesla-falls-4percent-on-report-elon- musk-sued-by-sec.html)

SEC Press release: [https://www.sec.gov/news/press- release/2018-219](https://www.sec.gov/news/press-release/2018-219)

United States Securities and Exchange Commission v. Musk [PDF uploaded to Scribd by CNBC]: [https://www.scribd.com/document/389617063/United-States- Secu...](https://www.scribd.com/document/389617063/United-States-Securities- and-Exchange-Commission-v-Musk#from_embed)

</comment><comment><USER41> As I said nine days ago in this box and was roundly downvoted therefor: "Good chance that Musk will get placed on the bad actors list and will be unable to serve as an officer or executive of Telsa." What I don't understand is how this took 10% of the price of Tesla shares. How is it possible that this event, which was a 100% certainty, was not already baked into the price?

<comment><USER42> I think most people thought Musk would get off with a fine. For a company partially driven by a cult of personality (at the very least given a significant benefit of the doubt). That hope was diminished and without Musk the entire company will be perceived differently.

</comment></comment><comment><USER43> "The suit seeks an order from a judge barring Musk from serving as an officer or director of a public company, a request often made in SEC lawsuits, as well as unspecified monetary penalties."

Does this imply that they want to remove him from being CEO and from the board of directors?

<comment><USER44> Or to simply make it a private company and stay CEO...

<comment><USER45> > make it a private company and stay CEO

Yeah, with what money?

</comment></comment></comment><comment><USER46> I'm willing to bet the only thing that will come of this is a fine and a slap on the wrist.

<comment><USER47> ...and irrepairable loss of investor trust

<comment><USER46> I don't believe so. I have been a Tesla owner and investor for a long time now. I know where Elon comes from, what missions and goals he has stated for years now, and what he is trying to accomplish.

I promise you, Elon legitimately thought there would be an opportunity to go private again. He's said he wanted to do so in the past, and even has said they never wanted to go public, but were left with no choice. I don't think any part of Elon was trying to commit fraud or security manipulation. He made a mistake, we all do. He said something that should not have been said at that given point of time. I'm sure he was excited. He even said he typed that tweet in the car after leaving SpaceX.

Should he be fined? That is up to the SEC. Will I and many other investor lose trust in what Elon's mission is? Absolutely not.

<comment><USER48> > I promise you, Elon legitimately thought there would be an opportunity to go > private again.

That's cool and all. And that's probably why the DoJ case will fail (at least, I'm betting that the DoJ case will turn up nothing).

But this is the SEC: they only have to prove recklessness or negligence. That Musk was NEGLIGENT in his ability to properly vet the information before tweeting.

In particular:

> Musk knew or was reckless in not knowing that each of these statements was > false and/or misleading because he did not have an adequate basis in fact > for his assertions.

[https://www.scribd.com/document/389617063/United-States- Secu...](https://www.scribd.com/document/389617063/United-States-Securities- and-Exchange-Commission-v-Musk)

As a CEO, his responsibility is to report on the news of the company to his investors in a responsible manner. If Musk is negligent and/or reckless about the facts, then that is ALONE sufficient to have him removed from the position.

That's the thing about this SEC case. They do not have to prove scienter (criminal knowledge of wrongdoing) or malice. They only have to prove recklessness or negligence.

EDIT: Upon further review, paragraph 79 claims that Elon Musk has scienter of these events. So the SEC is in fact claiming that Elon Musk deliberately knew that making these statements were wrong, and did it anyway. This is above and beyond "reckless" or "negligent" !!

<comment><USER49> I find it hilarious that intent is under doubt. Somehow people have forgotten "short burn off the century". If shorts squeeze did happen, there would be cheering everywhere.

<comment><USER48> Personally, I don't doubt intent. But "Beyond a reasonable doubt", as well as the necessity for a "malice" in the DoJ's case makes me think that... the DoJ has way too hard of a case to pull together.

I mean, I might be proven wrong. But... showing off a couple of rage tweets in court to prove malice doesn't seem plausible to me. Would a Jury of 12 (and remember: all 12 have to agree) be convinced over a couple of "who likes short-shorts" tweets?

If a SINGLE jury member, 1 out of the 12, disagrees, then you get a hung case aka a mistrial. As per the rules of the DoJ investigation anyway. That's why I don't think the DoJ will go anywhere, because proof and evidence is at a way harder standard in a criminal case.

</comment></comment></comment></comment></comment></comment><comment><USER50> This is a serious deal. The rest of the year is going to be a real test for Tesla! It'll be real interesting to see if they can rebound from this.

I wonder if the Tesla board is thinking of doing an Uber and replace Musk with a more calmer executive! Wouldn't be surprised if he gets fired after this.

<comment><USER51> > I wonder if the Tesla board is thinking of doing an Uber and replace Musk > with a more calmer executive! Wouldn't be surprised if he gets fired after > this.

I would be. They have stood by him so far, this isn't going to push them over the edge. Besides, who would they replace him with?

If the SEC fines him, he'll pay the fine and get on with his life.

<comment><USER52> Unless they ban him from being an executive at a publicly traded company

<comment><USER44> Couldn't he assign the janitor to be the official 'CEO', but then give himself title of 'Visionary' and still make all the decisions?

<comment><USER53> The SEC would not find this amusing.

<comment><USER54> Putin would!

<comment><USER55> Please don't do this here.

</comment></comment></comment></comment></comment></comment></comment><comment><USER56> >According to Musk, he calculated the $420 price per share based on a 20% premium over that day's closing share price because he thought 20% was a "standard premium" in going-private transactions. This calculation resulted in a price of $419, and Musk stated tha the rounded the price up to $420 because he had recently learned about the number's significance in marijuana culture and thought his girlfriend "would find it funny, which admittedly is not a great reason to pick a price."

[https://www.documentcloud.org/documents/4950588-SEC-v- Elon-M...](https://www.documentcloud.org/documents/4950588-SEC-v-Elon- Musk.html) (Page 7-8)

Wow, what a dumb thing to do and even dumber to admit to it.

<comment><USER57> It's better for him if it's an obvious marijuana reference. That way he can argue it was a joke that no reasonable investor would have relied upon.

<comment><USER58> I'm curious, does "reasonable" actually matter in a case like this? Say he tweeted "I just killed someone LOL" and the stock price drops. Could that also be construed as misleading investors?

<comment><USER57> The SEC needs to prove he made a "materially" false and misleading statement. The Supreme Court has defined a "material" fact for purposes of the securities laws to mean that there is:

> a substantial likelihood that the...fact would have been viewed by the > reasonable investor as having significantly altered the "total mix" of > information made available.

If a statement is an obvious joke, no reasonable investor could have viewed it as altering the mix of relevant information.

<comment><USER59> Could the SEC use as evidence the fact that the price went up post-tweet, and down after Tesla recanted? That is arguably objective evidence of reasonable investors taking his tweet as a material fact to their trading strategies (i.e. by buying stock).

<comment><USER57> Yes. Its not dispositive, because "reasonable" is a legal abstraction (so it admits the possibility that there are unreasonable investors who don't get the joke), but it's evidence.

</comment></comment></comment></comment></comment></comment><comment><USER60> Page 21: "Prayer for Relief"

interesting that this kind of language is accepted legalese

par. 80.IV and 80.V seeks both civil penalties _and_ removal from office.

Is it feasible that Musk/Tesla can negotiate only penalties, thus keeping him on the board? Given Musk's position of power over the board, and importance to the company, I could see the board agreeing to it, but would the government.

<comment><USER61> The language doesn't surprise me particularly.

"Pray" is an old word that means to ask. Hence "prithee", which is kind of a mashed together "pray thee" (which means "ask you"). And "prayer" is noun form of that verb.

Yes, the words are really old (archaic-sounding if not actually archaic), but that happens all the time in legalese.

And yes, they have religious connotations, but they are also used in secular ways. For example, from Shakespeare's "Romeo and Juliet": "I pray thee, good Mercutio, let's retire: The day is hot, the Capulets abroad".

<comment><USER62> I first came across "pray" (as a non-native speaker) through Sherlock Holmes. "Pray sit down" is ubiquitous in his stories.

</comment></comment></comment><comment><USER63> Glad it's only a CEO, imagine what a president could do with Twitter!

<comment><USER64> Someone has to explain that to me. Is the POTUS all powerful and can pretty much say anything?

<comment><USER65> No, but the republican majority in congress refuses to hold him accountable, and possibly voters too. Time will tell.

It is rather absurd that a CEO is seemingly held to higher standards then the president.

</comment></comment></comment><comment><USER66> A short while ago (per my comment history), I asked whether Elon Musk should remain as CEO of Tesla.

I think, for my part, the answer is clearly no. He might be brilliant, he has undeniably had a hand in creating something awesome with Tesla and SpaceX's technology, but he's now a danger to the very thing he helped build. This is just _one_ of the lawsuits filed against him or Tesla in recent weeks that have him as the primary cause. I want Tesla's mission to be achieved, I want them to succeed, and to me, Elon Musk is one of the biggest stumbling blocks in their way now.

Where does the buck stop? In my opinion, with Tesla's board, and Elon's ouster as CEO.

Edit: Worth noting that Elon's removal as CEO is one of the remedies the SEC seeks as well, and could thus be part of any settlement. (I'm not knowledgeable enough to handicap how likely that is.)

Another edit: Tesla has no D&O insurance, and therefore might be liable for whatever misconduct Elon is found to have done. That's a pretty big deal, and also a bad move on Tesla's part in not insuring against their (known quantity loose cannon) CEO. See [https://www.dandodiary.com/2018/08/articles/securities- litig...](https://www.dandodiary.com/2018/08/articles/securities- litigation/tesla-investors-file-securities-suits-elon-musks-take-private- tweets/)

<comment><USER67> If Elon Musk is removed as CEO at Tesla, Tesla is over.

I find it curious that an innovative American company pushing to help our carbon problem by going electric is so lambasted, shorted, constantly under attack. It cannot be argued that Tesla pushed forward both electric cars and self-driving vehicles as a major force (original self-driving push was a DoD X-Prize)

Personally I like when American companies succeed and push innovation forward. I would have zero hope of that happening if they bring in some generic C level executive like back in the day at Apple when they ousted Steve Jobs and brought in John Sculley.

<comment><USER57> > It cannot be argued that Tesla pushed forward both electric cars and self- > driving vehicles as a major force (original self-driving push was a DoD > X-Prize

Sure it can. Tesla has done basically nothing for self-driving cars, it's technology is glorified lane-keeping. As to electric cars, the Model S is the third best-selling electric car ever, after the Nissan Leaf and the Chevy Volt. Both of those cars were introduced _before_ the Model S. Electric cars are not yet mainstream, but when the become mainstream, they're going to look a lot more like a Chevy Volt than a Model S or Model 3. (The sport-sedan market Tesla is targeting is a niche, even if a very lucrative one. What people really want is a $25,000-35,000 small cross-over SUV or pickup truck.)

<comment><USER68> You are missing a few facts that completely oppose the point of your comment: the model S is not Tesla's first electric - that would be the Roadster, which was release a couple years before the other cars you mention. Chevy Volt is not full electric and can't get very far on pure electric. And the Nissan Leaf is a glorified golf cart that doesn't surpass 100 miles on a charge.

The frank truth is that both the better design and range of Tesla vehicles set the stage for electric cars to be adopted by everyone rather than just special interest groups.

You can be assured that every manufacturer in the world, such as BMW, is building up electric manufacturing capability due to the success of Tesla, and not Nissan.

<comment><USER57> The Volt was also not GM's first EV. Both the Roadster and GM's EV 1 were niche products. You can call the Leaf a golf cart, but it's sold more vehicles than the Model S. Yes the Model S has more performance, but it's also a vastly more expensive car.

As to other manufacturers, they were "building up electric manufacturing capability" before Tesla. Toyota was selling thr first RAV 4 EV before Tesla was even founded. Tesla didn't have the first EV. It may have the best EV now, but that hardly says anything—it's much easier to make a $50-100,000 EV than on at a mainstream price point. The remaining question is who is on track to create products in the form factors people care about (not sports sedans) at prices they can afford? At this rate, that's not Tesla either.

<comment><USER68> Are you aware that the RAV 4 EV used Tesla batteries?

Regarding the Roadster being "niche", it still looked like a normal car at least, unlike the EV 1, and any other electric car at the time. Furthermore, they had a roadmap to more affordable cars that still fit the moniker "normal". Other car companies were just running their EV projects as experiments, or as a way to appease California legislators to meet quotas, or simply retrofitting a non electric frame with batteries in a way that left much to be desired.

No one was trying to make a non-toy full electric car until Tesla.

<comment><USER57> The first RAV 4 EV came out in 1997. Tesla was founded in 2003.

> No one was trying to make a non-toy full electric car until Tesla.

The Roadster was a toy, costing over $100,000 and selling approximately 2,500 vehicles, in the same ballpark as the EV1. The idea that it spurred GM and Nissan to build completely different EVs for the opposite end of the market is delusional. The timing also doesn't work. It took Tesla several years to bring the Roadster to the prototype stage. Counting back a similar length of time from when the Volt was unveiled as a concept car, that means GM would've been working on it since 2004 or so, years before the Roadster came out.

</comment></comment></comment></comment></comment></comment></comment><comment><USER69> He responded:

"This unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way."

[https://techcrunch.com/2018/09/27/tesla-ceo-elon-musk- respon...](https://techcrunch.com/2018/09/27/tesla-ceo-elon-musk-responds-to- sec-securities-fraud-charges/)

</comment><comment><USER70> I'm quite doubtful this suit will succeed. To succeed the SEC would need to prove intent to disrupt the market. You can certainly show that he had a reason to attack short sellers, but he also has a long history of communicating in exactly that manner. He probably also has plenty of evidence of meetings that justify the statement. If that assumption is correct, given his historical use of this medium of communication, I can't see how you prove intent.

<comment><USER71> > He probably also has plenty of evidence of meetings that justify the > statement.

By Musk's own description I don't see how any reasonable human being could interpret the meetings he said he had with the Saudis as meaning "funding secured". The verbal gymnastics he tried to use when explaining his tweet in saying "I knew we could get a deal" made me think "Come on Elon, I don't even think _you_ believe the bullshit you're peddling."

</comment></comment><comment><USER72> It looks more and more that Tesla will follow a trajectory similar to GM: [https://hbr.org/2018/04/to-understand-the-future-of-tesla- lo...](https://hbr.org/2018/04/to-understand-the-future-of-tesla-look-to-the- history-of-gm)

(If you didn't know about early GM, like I didn't, the article is worth reading.)

</comment><comment><USER73> The theoretical "go private" option under current circumstances is probably out. Tesla would have to rely on Regulation D[0] to privately place its securities in connection with going private. Being deemed a "Bad Actor" with respect to Tesla could eliminate that option as long as Musk is still a "Covered Person", which includes directors and executives, and, importantly, large owners of the issuer[1]. As SpaceX presumably relies on Regulation D to place its securities, this may have also already implicated SpaceX's ability to rely on Regulation D going forward.

[0] [https://www.sec.gov/fast-answers/answers- regdhtm.html](https://www.sec.gov/fast-answers/answers-regdhtm.html) [1] [https://www.lexology.com/library/detail.aspx?g=6a9b59e7-1b37...](https://www.lexology.com/library/detail.aspx?g=6a9b59e7-1b37-476b-8edf-812f35935c91)

</comment><comment><USER74> I thought the most fascinating part of the article was the following exchange:

>"About 20 minutes later, the company's chief financial officer texted Musk: "Elon, am sure you have thought about a broader communication on your rationale and structure to employees and potential investors. Would it help if [Tesla's head of communications], [Tesla's General Counsel], and I draft a blog post or employee email for you?"

Musk responded, "Yeah, that would be great."

Tesla's Chief Financial Officer then replied, "Working on it. Will send you shortly.""

The CFO seems oddly nonchalant with this crazy development. Or is this just sarcasm?

The individual then offers to draft up comms without even first inquiring about that "rationale."? Is this what passed for normal at Tesla or were the "WTF" and exclamation points redacted?

</comment><comment><USER75> The irony of it all is that Elon Musk probably ended up making the people shorting TSLA a lot of money with that stupid tweet.

Down to $266 in after hours trading:

[https://www.nasdaq.com/symbol/tsla/after- hours](https://www.nasdaq.com/symbol/tsla/after-hours)

Ouch.

</comment><comment><USER76> Interesting legal point, does Musk have any legal duty to the Tesla shorts? If I'm not mistaken they don't officially own the shares they short so I'm thinking not.

On the other hand if the "shorts" are actively working against the interests of "long" holders of Tesla stock and Musk works against their interests (but in the interests of shareholders) how can that run afoul of the rules?

Not a lawyer so it may not be as black and white as this but I would interested to hear from those that are familiar with legal precedents on this issue.

</comment><comment><USER77> How many different lawsuits and investigations is Elon now the subject of? There's this, the separate DOJ investigation, the lawsuits from private investors who exited their short positions, the libel suit from the British guy, possibly an Air Force investigation about the weed... am I missing any?

Even if every one of these turns out to be nbd, I wonder if it makes sense to remove Elon just on the grounds that a) it's embarrassing and b) he can't address all of these at once and still effectively run two companies.

<comment><USER78> Isn't that kind of the point of piling lawsuits onto someone promising that you see as competition?

<comment><USER79> Yes, exactly, I win every time because I just make my competition shoot itself in the foot over and over, very simple.

</comment></comment></comment><comment><USER80> What a joke, there are plenty of scumbag and criminal leaders of corporations and this is the guy who doesn't walk. It'll be a sad day for the world if this guy goes to jail.

<comment><USER81> It's like this clip from the 1990s Batman cartoon regarding the Joker's view on the IRS.

[https://www.youtube.com/watch?v=G56VgsLfKY4](https://www.youtube.com/watch?v=G56VgsLfKY4)

Securities crime is almost always prosecuted in the US because of how much of our economy depends on it being free of outside manipulation. This is why all stock trades are tracked so intensely. A crook may be able to systemically deprive people of health insurance and get away with it, but he/she will almost certainly go to prison if caught manipulating the stock market for personal gain.

<comment><USER80> I believe it, but it's kind of stupid that GS or JPM "analysts" can "downgrade" a stock and move it by 4%, and this happens literally every day, but some guy who is going to put humans on Mars and fly them around the moon is going to get shit for a tweet that was obviously a joke to anyone who isn't a total moron.

<comment><USER82> A tweet that moved the stock by >4%.

</comment></comment></comment></comment><comment><USER83> Alas, on the path to greater things achieved, quarrels of mankind see no relief; to build a house of time and stone, requires an ounce of flesh and bone.

</comment><comment><USER84> tesla might have succeeded if this guy was not ceo. if he is doing these kinds of shenanigans in public, i can only imagine how he runs things internal. also, from the lawsuit it seems like he is surrounded by yes men. nobody told him what he did was stupid, instead the other executives immediately jumped on board of promise train.

</comment><comment><USER63> Hopefully it only hits Tesla (which never understood people excitement) and a deal can be made he's staying head honcho (resarch? vision?) at SpaceX where I really think he can help humanity (hopefully Mars will not become a land grab as the US was, but I fear it's the same again)

<comment><USER85> This seems incredibly unlikely because his actions were so independent of Tesla. They aren't pursuing Tesla right now, they're pursuing Musk personally.

</comment></comment><comment><USER40> What would be the argument in his defense?

<comment><USER86> The shorts against Tesla were enormous. Millions (billions?) were put against Tesla. You can't tell me that the shorters did not invest extra money to make their short profitable. That extra money would go into PR to make Tesla look like failing company. That is not fair play either... Basically Musk gave a punch back after being bullied and stressed.

Self-defense?

Also the Tweet started with: "I am thinking of". Not matter of fact, but just announcing what you are thinking of.

Anyway... maybe he can be CEO by proxy or focus more on leading the engineers.

<comment><USER87> > The shorts against Tesla were enormous. Millions (billions?) were put > against Tesla.

It's definitely billions (about $10 billion short interest as of mid- September-[0], not including options contracts). I'm very much a small-time investor and I'm personally short well over a million dollars of $TSLA.

[0] - [https://www.nasdaq.com/symbol/tsla/short- interest](https://www.nasdaq.com/symbol/tsla/short-interest)

</comment></comment></comment><comment><USER88> Here's the actual filing: [https://www.sec.gov/litigation/complaints/2018/comp- pr2018-2...](https://www.sec.gov/litigation/complaints/2018/comp- pr2018-219.pdf)

</comment><comment><USER89> Musk is Tesla, and people loves Musk whatever he do. The same way a couple years ago, the Apple Board pulled out Steve Jobs from his company, they are now trying to do the same with Musk on Tesla. BAD Move. Tesla without Musk is nothing

</comment><comment><USER90> I just hope Musk doesn't end up suiciding cause of all of this. =/

</comment><comment><USER91> To me it's weird because when I heard the news I assumed he was full of shit. And the market realized pretty quickly as well. Wished I had shorted the stock...

</comment><comment><USER30> Lawsuit secured.

</comment><comment><USER92> the actual filing is more interesting: [https://cdn.pacermonitor.com/pdfserver/3KSLKOY/96034763/Unit...](https://cdn.pacermonitor.com/pdfserver/3KSLKOY/96034763/United_States_Securities_and_Exchange_v_Musk__nysdce-18-08865__0001.0.pdf)

</comment><comment><USER93> For a genius he's a bit of a moron

<comment><USER94> Unless he's an evil genius. There are financial advantages to tanking the value of your stock in the short term, especially if your primary goal is to increase your ownership in the company. I believe on more than one occasion he has made controversial statements which tanked the price, then purchased millions worth of shares to "inspire confidence".

</comment></comment><comment><USER95> Is there any logic in forcing the share price down in order to make a go private deal possible?

</comment><comment><USER96> Wealthy narcissistic attention seekers should be subject to the law just like the rest of us.

</comment><comment><USER97> So if he's banned from running a public company, could he... take Tesla private?

</comment><comment><USER98> All I can say is that the Star Trek: Discovery name drop will age extremely poorly.

</comment><comment><USER92> does the SEC have a case? Elon can say the post was a joke (probably the truth), or that he sincerely intended to take the company private at $420 after smoking a joint with a potential backer but then later thought better of it, say he even confessed that his tweet was a deliberate attempt to mislead short-sited investors in a lapse of moral judgement; it would still be just a note on a social network, not an official company announcement. what if he left his phone unattended and someone made that tweet, would the SEC be suing him for negligently managing his twitter stream? isn't the real problem that too many "investors" are making short-sited decisions based on nonsense posted to social networks?

<comment><USER99> from the filing:

> _In November 5, 2013, Tesla publicly filed a Form 8-K with the Commission > stating that it intended to use Musk's Twitter account as a means of > announcing material information to the public about Tesla and its products > and services and has encouraged investors to review the information about > Tesla published by Musk via his Twitter account._

</comment></comment><comment><USER100> Life lesson: never tweet.

</comment><comment><USER101> The day Elon Musk ceases being CEO of Tesla is when I'll buy TSLA. Until then, it's too much of a volatile shit show with his unpredictable behavior too closely resembling that of the 45th president of the United States.

</comment><comment><USER38> TLDR; According to article, SEC did do the "swift" investigation and it seems they were convinced Musk had no hard evidence to back up his $420 claim. They even drafted settlement agreement that was supposed to be signed which I'm guessing involved removing Musk from exec position. However at last minute Musk's lawyers decided not to go for settlement and now they are going to fight the case. I'm thinking they probably cooked something with Saudi to corroborate the claims - may be in exchange for some future deal. For whatever reason, Musk lawyers have figured things out so at this point Tesla is buy for me.

</comment><comment><USER34> The good thing is that none of his companies are named after himself...

</comment><comment><USER102> Musk did not want to quit Tesla, but wanted out: tweetice.

</comment><comment><USER99> this thread seems to have "won": [https://news.ycombinator.com/item?id=18088118](https://news.ycombinator.com/item?id=18088118)

<comment><USER103> It did! But it seems fair to go with the earlier submission, so we did.

</comment></comment><comment><USER104> YESSSSSSSS

sic em boys

Now my opinion will be supported by the full faith and credit of the United States of America

Gamma team activated. Its an options reference. Its always been about the Greeks.

</comment><comment><USER34> Twitter is like keeping a loaded gun in the house with kids.

Politicians, Business leaders, community influencers...

BEWARE

<comment><USER105> (removed)

<comment><USER106> This isn't really the context here. It's a tweet from 10 years ago. He wrote a tweet, lying about having secured funding to take Tesla private, even giving the weird price of $420. His tweet was not taken out of context or misconstructed, he did this tweet very willingly and this tweet meant exactly what he wanted it to say.

<comment><USER105> Oh yes, you're correct, and sometimes I go on a tangent and leave comments that aren't in the exact same context from when I first started thinking. :)

</comment></comment></comment></comment><comment><USER107> The Neon Neon album about Musk is going to be straight fire.

</comment><comment><USER108> Imagine if he knew this would happen, and the reason he went on rogan was a strategic play to win public favour. (I mean I love Elon, but it's not totally improbable.)

<comment><USER75> If this is your idea of winning public favor then you suck at strategy :)

</comment></comment><comment><USER109> > "In truth and in fact, Musk had not even discussed, much less confirmed, key > deal terms, including price, with any potential funding source,"

Interesting. How do they know? Did someone from SEC called Musk and he said: "Nah, we're just in talks with investors, nothing lined up yet".

<comment><USER110> Close enough, he blogged about it [https://www.tesla.com/blog/staying- public](https://www.tesla.com/blog/staying-public)

<comment><USER109> Ah, gotcha. Thanks a lot for the link.

</comment></comment></comment><comment><USER111> The proposed punishment is statutorily allowed for the infraction. Sadly, in this climate, it's not clear whether this is standard operating procedure for this, though, or whether a particularly vindictive response because of some political slight Musk may have committed towards the administration or the SEC.

</comment><comment><USER112> It is really sad to see this happening to Elon. He is one the handful of visionaries who wants to change the world for the better. He could have easily choosen to sell our private information for adds but he went for reducing our dependence on fossil fuels. And then he sends an idiotic tweet in the middle of the day. Such a shame!!!

<comment><USER113> Not just one idiotic tweet.

</comment></comment><comment><USER114> He could offer to sell his personal shares for $420 a pop. SEC would have no case, Elon gets more $$ to put into Boring. Win win.

</comment><comment><USER115> Most of the executives are gone. And the ones that remain are getting sued. Tough times for Tesla.

</comment><comment><USER116> What if it was true, what if he was working with a group to secure funding to take the company private? Would that make the claim that he was 'deceiving' the investors invalid? I don't really know anything about this kinda thing but I would think if he was just saying that he was working towards that goal but deiced not to do it wouldn't be 'deceiving.'

<comment><USER117> When I'm making a deal, I usually keep my mouth shut about it until every document that needs to be signed, has been signed. The Musk worship on here and the Internet in general has for too long overlooked his impulsive behaviour in the capacity of his CEO role.

<comment><USER116> I don't find impulsiveness to bar someone from being am effective CEO (though I might not invest in that company). I was looking for a more reasoned answer around if it would still be illegal to say what he did if he actually had the backing he was alluding to. The answer that jonknee gave shows that my question is not the case in this instance but it was a more hypothetical.

</comment></comment></comment><comment><USER118> ....well, fuck. I had hoped like any of us rooting for Elon Inc. that this wouldn't happen. I truly hope it amounts to a slap on the wrist because I want Tesla to succeed.

I'll show my support with my wallet as soon as I am able.

<comment><USER119> Elon's judgment has been compromised by intense stress combined by lack of sleep and he is now a detriment to Tesla. For the past several months he has been a complete PR disaster. If you want Tesla to succeed as I do, you should support his ouster.

If Tesla can't survive without Elon, then maybe it doesn't deserve to. A single point of failure that is one person is not a sustainable business.

</comment></comment><comment><USER120> The suit asks to prevent Musk from being an officer of a public company. That would be a very severe punishment for him. So the way to deal with that is to take Tesla private.

Problem solved!

</comment><comment><USER121> This is his Pepsi moment. Ousted from Tesla, will have to hang low and learn more, and will buy back Tesla (with the help of William Gates)

</comment><comment><USER68> Something's not right in the US when one of the world's top innovators and fighters for renewable energy is toppled by a tired tweet, and the unaccomplished sexual molester of a leader of the US says many far worst things on nearly a daily basis for years and gets away with it.

<comment><USER122> You have to be extremely careful with your public statements when you run a publicly traded company. Full stop.

<comment><USER68> I get that, hence my statement. I don't think it should be the case.

</comment></comment></comment><comment><USER123> Probably he's gonna draw out an email by the Saudi or some other state fund declaring they're willing to take over enough Tesla stocks for effectively taking Tesla private (gotta leave some stock for Musk and employees, I guess).

For what it's worth I actually expect something alike this, the Saudi (and other Arabian) states are trying to convert their monies into something that does _not_ depend on oil since years. Tesla and every other car company with a decent EV portfolio are and will be perfect targets for that strategy.

</comment><comment><USER124> While there isn't much doubt that Musk is at fault here, I wonder how a business owner should react when perceiving that his company is threatened by some journalists and (social) media influencers who seemingly have ties with short sellers. I understand that shorting helps stabilize markets but in this case with Tesla being the most shorted stock it seems that forces were at work to stain the company's reputation in order in order to prevent important losses. Seems unethical to me as well, but maybe I am being very naive here.

<comment><USER41> If a CEO of a publicly traded company expresses a belief in a short- side/journalism conspiracy, the board of that company should relieve that person of their duties right away. All such people in recent history have been paranoid cranks who drove their companies into the ground. See: Overstock

As for Tesla specifically, there is an overt and massive "conspiracy" on the part of the long side to cheer their share price. There are numerous online news outlets that are shameless boosters of Tesla. The idea that there's a big conspiracy between short sellers and journalists has no supporting evidence whatsoever.

</comment></comment><comment><USER125> Musk being banned from serving as an officer or director of a public company... Does anyone else see this as the beginning to the rise of a super villain?

Think about it: our insanely legislated government decides that a rich and accomplished engineer/businessman can no longer run his businesses? He would totally turn evil, buy an island, and start building his super lair!

</comment><comment><USER126> On one hand, the $420 tweet was just blatantly obviously a bad idea and he should have known better.

On the other hand, it feels... strange somehow that a joke (if a slightly deadpan one) has consequences this severe. It affected the markets and it obviously wasn't without real-world consequences in any case, but something about this all just feels a little off somehow.

<comment><USER127> I wonder if they will be able to demonstrate that any damage was actually done. The $420 tweet had a reverse effect in the end, not what most people would expect from such a tweet.

<comment><USER128> If I, a not-inexperienced investor, briefly wondered if I should by a few more lots of TSLA based on the tweet, it is not unfathomable that someone actually clicked the "buy" button somewhere near the peak. In short, yeah, it would be trivial to demonstrate damage. _Someone_ was buying those pricey shares before the drop.

EDIT: down $31 in after hours, hell, _I'm_ thinking about suing. :-P

<comment><USER129> Same. I thought there was no way he say such a stupid thing as "funding secured" without haven't it locked down precisely because I thought the SEC would easily come after him if he lied about it.

Fortunately, my brother talked me out of it but I was seriously considering buying some.

<comment><USER128> _because I thought the SEC would easily come after him if he lied about it_

Which is exactly it. Folks here and elsewhere refer to it as "...obviously a joke". No, it's not so obvious, because if you joke about such things _the SEC will nail your ass to the wall_. And hence my consideration of purchase. Were the SEC _not_ to follow through, well, what are they going to say when the next joker says, "j/k"?

And so, apologists and Musk themselves are about to find out that they're fucking serious when they tell you not to make bomb jokes in the airport security line. And when your antics take 10% off your share price in one day, Musk'll start to lose some fans even, because this shareholder sure isn't the Musk fan he once was.

<comment><USER75> For me the turning point was when he joked Tesla was going bankrupt. It showed a complete misunderstanding of the role of the CEO in a public company as opposed to the CEO of a private company. You live in a glass house, that means you move with care and don't throw bricks around.

</comment></comment></comment></comment></comment></comment><comment><USER130> The subtext is that Elon intentionally bumped the stock price to screw over short sellers like Jim Chanos. But the rationale behind 10b5 is to protect _investors_ from fraud. Right, we are not concerned with protecting short- sellers who spend _all day_ on twitter making up negative stories about their targets. So the underlying rationale here has to be that Elon's $420 tweet harmed regular investors who purchased TSLA at inflated prices during the time between his initial tweet and the announcement that there would be no go- private transaction.

The irony of SEC enforcement power is that the harsher they come down on the company or its execs, the more damage they do to the very investors they are charged with protecting. And I tihnk that is why you often see relatively modest settlements. Ya know, unless the board of Tesla is tired of Elon, I think there is a decent chance they are able to reach a settlement where Elon is not barred from serving as an officer or director.

<comment><USER131> > Right, we are not concerned with protecting short-sellers who spend all day > on twitter making up negative stories about their targets.

This doesn't make sense. We don't go after them because they don't have any authoritative powers/inside knowledge about the company, so a reader cannot be misled by them. If an exec of a company short sells a huge chunk of the company and plants a misleading negative story about the company, SEC will go after them too.

<comment><USER130> What I mean is, we are concerned with price manipulation. But the theoretical harm of price manipulation is that some investor has overpaid based on the intentionally misleading $420 tweet. The SEC is not primarily trying to protect Jim Chanos from getting screwed on his short position. It is trying to protect the "investing public" more generally. When they talk about damages it's not going to be damages suffered by the shorts. It will be damages suffered by investors who overpaid based on $420 expectation.

Note that you are actually wrong about 10b5 here, Jim Chanos can very well commit a 10b5 violation without being an insider. Securities fraud does not depend on fiduciary status of the perpetrator, and while insider trading is fraud, there are many other types of fraud as well.

edit: Jim Chanos is too smart to commit a 10b5 violation. I am just using him as a hypothetical example!

<comment><USER49> Price manipulation hurts short sellers by causing "short burn of the century"

<comment><USER130> Yeah, and I believe some of the shorts may have cause to sue (or have already?) directly. But I tend to think the SEC's focus as to damages is not going to be that Elon screwed the shorts. It's going to be that some people bought shares of Tesla at too high a price. I could be wrong, maybe this is more of a general "integrity of markets" kind of thing, and the SEC doesn't care about direct harm at all, they just want to deter other aspiring short slayers out there.

<comment><USER131> Yeah I would be surprised if SEC treats short-sellers as different from investors. The general tone you are maintaining is short sellers are some sort of abominable gamblers who thrive on failures of other investors. Uh, no. A short seller is just another investor investing using the tools the market provides.

<comment><USER49> Exactly. I find it hilarious that some people think that SEC should make sure that a certain category of investors be in profit.

Nopes, SEC makes sure that laws and regulations are followed. Investigations in Enron also led to people losing money.

<comment><USER130> Unfortunately your notion of the SEC as neutral referee for a fair market is not reality. The SEC lacks the resources to enforce the law consistently even within a narrow mandate. Its approach is to target specific violators as a deterrant and/or to make known what it considers to be the proper interpretation of securities laws. Some people consider this to be a major defect in US securities enforcement regime and suggest that the SEC should be resourced appropriately to the immense task. Personally I have no idea what they would need to more systematically pursue violators, but wild guess would be a couple orders of magnitude more funding and personnel.

In the realm of securities fraud, I would say that the private securities bar does about 90% of the impact (in terms of judgments and settlements). And successful criminal referrals a la Enron are quite rare, proportional to the actual amount of fraud going on.

By the way, Enron was a fraud against its own investors. Enron was not about fraud against short-sellers, it was fraud against purchasers of Enron stock. Not that short-sellers don't deserve honesty, just saying that they do not typically receive much love from regulators. From what I can tell, it seems this is not solely due to the disposition of said regulators, but also because of legal uncertainty around short-sellers' rights under securities laws.</comment></comment></comment></comment></comment></comment></comment></comment>