Tesla is set to finish 2022 as one of the worst-performing stocks of the year. In the two months since owner Elon Musk purchased Twitter, shares of Tesla have dropped 45%. In total, the stock is down 65% since January.
Instead of uncertainty in Musk, himself, since the Twitter acquisition, the billionaire says interest rates are to blame.
“In simple terms: as bank savings account interest rates, which are guaranteed, start to approach stock market returns, which are not guaranteed, people will increasingly move their money out of stocks into cash, thus causing stocks to drop,” Musk recently wrote on Twitter.
Tesla investor and Future Fund manager Gary Black challenged him in the replies. He cited differences between Telsa’s fall-off and the rest of the market.
“Elon – you can’t compare a very short duration bank with long duration $TSLA stock…,” Black wrote back. “Since you closed on TWTR, TSLA [is down] -38% vs NDX [Nasdaq 100] -1%. If it was all [interest] rates, NDX would be down a similar amount.”
Musk has sold nearly $40 billion worth of Tesla stock since last year. As recently as earlier this month, he dropped off another $3.6 billion. Afterward, he vowed to stop selling Tesla stock until at least 2024; however, he’s broken similar promises in the past.
Additionally, Tesla is offering a $7,500 discount on Model 3 and Model Y vehicles delivered in the U.S. this month.
Musk said last week that he intends to resign as head of Twitter once the company identifies a successor. He previously ran a poll asking whether he should do so.
[Via]