Elon Musk’s bad feeling and the trade of fear – Economic Policy

Today, if you want to keep your spirits up and not stay hidden under the duvet, it is better not to read the economic press. It’s the total blues, to believe that it’s one-upmanship to the one who will announce the end of the world.

We are truly in the business of fear. Out of sympathy, I save you the trouble of reading the headlines of this depressive press, I read it for you. I will summarize these gloomy forecasts for you: famine threatens the world, especially the countries of sub-Saharan Africa. If you have escaped starvation, then we are promised a winter without heating in Europe. And if despite everything, you manage to survive these calamities, then the recession will catch up with you. Former President Jacques Chirac had already warned when trouble comes, it usually comes in squadrons.

As Marc Fiorentino points out, these predictions are not wrong, but they are probably exaggerated. If only because they come from institutions, certainly respectable, but which saw nothing coming. Don’t forget that the economists who work at the World Bank, the IMF, the OECD and the ECB have all told us that there is no risk of inflation. And when inflation took hold, they tell us that it was temporary and now that they have understood that they have screwed up their forecasts, they tell us that this inflation is going to be strong and last for years. It’s classic, I’m not the only observer to see it, the pendulum swings from unbridled optimism to the most devastating pessimism.

Some even comfort themselves in this misfortune by specifying that even Elon Musk, the richest man in the world, wrote a Tweet in which he indicates that he has a bad feeling for the economy and that he has decided to lay off 10% of Tesla staff. Isn’t this proof that things are going badly and will be even worse tomorrow? Yes and no. The Bloomberg news agency recalled that it was its competitor Reuters who announced the dismissals of 10% of Tesla staff before being denied by the facts. In fact, as always with Musk, he tweets faster than he thinks. As soon as this information was sent, Elon Musk clarified in two other tweets that it was only Tesla employees and not staff paid by the task before retracting again and sending another tweet in which he specifies to the final that he will even hire staff and that it is only the salaried part that will remain stable.

In fact, Elon Musk makes com. He understood that Tesla has lost 35% of its stock market value since the start of the year. Investors accuse him of dispersing in particular with the possible purchase of Twitter. Elon Musk has understood the message well and wants to show that he is ready to make strong decisions to turn Tesla around. But his order books are full and even if the costs of raw materials have increased, he passes it on to his customers: the proof, he has increased the price of the Model 3 by 7,000 euros in six months. Clearly, Elon Musk says he has a bad feeling, but his own business isn’t that bad. Musk is a master of communication. His com’ on Twitter has saved him billions of dollars in advertising, but for several weeks, his communication has turned against him.

For the rest, it’s true, economic forecasts are important, you have to listen to them carefully, but don’t forget, as the economist Galbraight said, that they also sometimes have the function of making astrology respectable!

We are truly in the business of fear. Out of sympathy, I save you the trouble of reading the headlines of this depressive press, I read it for you. I will summarize these gloomy forecasts for you: famine threatens the world, especially the countries of sub-Saharan Africa. If you have escaped starvation, then we are promised a winter without heating in Europe. And if despite everything, you manage to survive these calamities, then the recession will catch up with you. Former President Jacques Chirac had already warned when trouble comes, it usually comes in squadrons. As Marc Fiorentino points out, these forecasts are not wrong, but they are probably exaggerated. If only because they come from institutions, certainly respectable, but which saw nothing coming. Don’t forget that the economists who work at the World Bank, the IMF, the OECD and the ECB have all told us that there is no risk of inflation. And when inflation took hold, they tell us that it was temporary and now that they have understood that they have screwed up their forecasts, they tell us that this inflation is going to be strong and last for years. It’s classic, I’m not the only observer to see it, the pendulum swings from unbridled optimism to the most devastating pessimism. Some even comfort themselves in this misfortune by specifying that even Elon Musk, the richest man in the world, wrote a Tweet in which he indicates that he has a bad feeling for the economy and that he has decided to lay off 10% of Tesla staff. Isn’t this proof that things are going badly and will be even worse tomorrow? Yes and no. The Bloomberg news agency recalled that it was its competitor Reuters who announced the dismissals of 10% of Tesla staff before being denied by the facts. In fact, as always with Musk, he tweets faster than he thinks. As soon as this information was sent, Elon Musk clarified in two other tweets that it was only Tesla employees and not staff paid by the task before retracting again and sending another tweet in which he specifies to the final that he will even hire staff and that it is only the salaried part that will remain stable. In fact, Elon Musk is in communication. He understood that Tesla has lost 35% of its stock market value since the start of the year. Investors accuse him of dispersing in particular with the possible purchase of Twitter. Elon Musk has understood the message well and wants to show that he is ready to make strong decisions to turn Tesla around. But his order books are full and even if the costs of raw materials have increased, he passes it on to his customers: the proof, he has increased the price of the Model 3 by 7,000 euros in six months. Clearly, Elon Musk says he has a bad feeling, but his own business isn’t that bad. Musk is a master of communication. His com’ on Twitter has allowed him to save billions of dollars in advertising, but for a few weeks, his communication has turned against him. For the rest, it’s true, economic forecasts are important, you have to listen to them carefully , but do not forget, as the economist Galbraight said, that they also sometimes have the function of making astrology respectable!

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