Tesla and SpaceX CEO Elon Musk is a regular in the news headlines. From his Tesla-centric tweets to stock market surges of Gamestop, Signal, and Clubhouse - his tweets have become the gospel truth. His remarks about the COVID-19 pandemic initiated debates and kicked-off insightful research. But, should you really bet all your money and life on those tweets?
Elon Musk on Twitter
Elon Musks’s famous episode with the SEC (Securities Exchange Committee) is not unheard of. The SpaceX and Tesla CEO tweeted – “Am considering taking Tesla private at $420. Funding secured”.
It shot up Tesla’s stocks to the top, but soon Musk revealed that his claims about the funding weren’t precisely accurate, and he landed in grave trouble with the SEC. In another disturbing tweet, he ended up getting sued for tweeting “pedo guy” for a rescue driver.
There isn’t just one isolated incident. The tech nerd turned millionaire has been notorious for tweets that have turned stock markets upside down.
On a fine Sunday, Musk tweeted – “on Clubhouse tonight at 10 pm LA time.” This tweet was followed by a 45% soar in the shares of Clubhouse Media Group. The irony is Musk did not even tweet about the company; he was referring to the privately owned Clubhouse audio app.
A couple of days before, Musk added “#bitcoin” to his bio, and bitcoin saw a surge by 15%. A similar incident occurred in the same week. Musk tweeted, “Gamestonk!” and the shares of Gamestop exploded by 157%. The tweet ended up raising the value of Gamestop by $10 billion.
The Signal Boom
This unnatural manipulation of the market was also seen when Tesla CEO urged his followers to use the encrypted messaging app – Signal. Some investors attempted promptly buying the stocks but ended up investing in a components producer – Signal Advance. This small venture saw its stock up by a whopping 1110%
Wall Street experts notice that instead of analysts and insiders driving security exchange demands, stocks shoot or plummet as per tweets by Digital Media Moghuls. They advise that when an investment isn’t driven by the fundamental workings of the market, investors have to remain cautious. Beginner investors are set to lose a lot once share prices take their natural course. In other words, investors would be better off by not considering cryptic tweets as investment recommendation.
Musk tweets undermined the dangers of Covid
While his tweets have definitely been market bending, there is another aspect that many began to worry about in 2020. During the crippling pandemic, the world literally moved online, and Musk became an even popular global influencer. The death toll kept increasing every day, and for a while, no hope could be seen. Many turned to Musk and his tweets – the man who knows and does everything. With 45 million devoted followers on Twitter and his hand on the hilt, he can and did influence practically everything.
Musk came out with the most worrisome string of tweets during the COVID-19 pandemic. He grossly underestimated the pandemic throughout and tweeted, calling the pandemic panic “dumb.” In late March, Musk responded to a Twitter user by saying, “N-95 masks are a pain to wear btw. Less onerous masks are better most of the time.”
At a time when cases in Italy were increasing exponentially, Musk tweeted that cases were “leveling out in Italy” and falsely claimed that children are immune to the virus. Soon enough, he was also at the helm of online chaos when he tweeted about using a malaria drug as COVID–19 treatment. This statement was not scientifically researched or was proven to improve COVID symptoms.
While nobody is perfect, and everyone can be wrong sometimes, the ripple effect created by one tweet cannot be ignored. With a huge following and such devout fans, his platform should be wisely used for any comment. Such tweets not only create chinks in the armor of an image and a fan following he proudly crafted, but also promise false hope to people in delicate circumstances.
The Elon Musk cult is endangered
Over the years, with the release of his biography titled Elon Musk: SpaceX, Tesla, and a Quest For a Fantastic Future, the visionary entrepreneur has come to enjoy parallelism drawn with Tony Stark, aka Iron Man from the Marvel Universe. However, his recent ill-researched tweets and SEC fiasco where he ended up paying a fine of $20 million push us to believe he is just another ruthless industrialist.
The problem here is, when Musk tweets that by April COVID-19 cases in America will be almost zero, a follower would most likely believe him. He is Elon Musk; he meets with the best researchers and, therefore, would be right in predicting so. The reality remains far from expectations. Most of his tweets about the pandemic were wrong and only created online chaos on social media platforms.
Some of his followers realised that he was wrong. They posted relevant research such as the importance of N-95 masks and how social distancing will reduce the spread of this virus. Musk, however, did not respond or accept his mistake.
Ben Hallert, a long time SpaceX fan and Tesla shareholder, comments in The Atlantic, “Sometimes it just seems like the smarter people are, the more vulnerable they are to overestimating how much they know about something outside of their specialty”. He adds that he cannot wait to see the SpaceX take flight, but also genuinely wishes that his idol, Mr. Elon Musk, should probably stop tweeting.