Elon Musk, the billionaire head of Tesla, Space X, and Twitter, on Thursday predicted a “serious recession” in 2023 and promised not to sell Tesla stock next year “under any circumstances.”
Speaking in a Twitter Spaces audio forum, Musk also assured investors Tesla hadn’t “skipped a beat on execution” since he took over Twitter. Twitter required an initial period of intense focus to get its “insane … costs under control” to stop it from going “flat bankrupt” next year, Musk said.
“I was still doing Tesla work during that time as well, by the way. And I think really Tesla has really not skipped a beat on execution,” he said. “The Tesla team is doing an incredible job across the board in execution.”
Tesla share prices fell further on Thursday over concerns about slowing demand for electric vehicles. Musk’s stock sales and focus on Twitter have also been blamed as a contributing factor, but Musk rejected this on Thursday, blaming the Federal Reserve’s interest rate increases.
‘Won’t Sell Stock’
Musk sold around 22 million Tesla shares between Dec. 12 and 14, valued at roughly $3.6 billion, according to a Securities and Exchange Commission filing. He has sold around $23 billion in Tesla shares since April, with much of the funds going toward his $44 billion acquisition of Twitter.
On Thursday, he promised not to sell any more stocks for the next two years.
“You have my commitment that I won’t sell stock until, I don’t know, probably two years from now. Definitely not next year under any circumstances and probably not the year thereafter,” Musk said.
Musk said he needed to sell some of his stock “to make sure, like, there’s powder dry … to account for a worst-case scenario.” The phrase “powder dry” means to always be prepared to take action yourself. Musk has previously made promises about not selling Tesla stock before subsequently selling it.
Less Focus on Twitter
Once he gets “the engine of engineering at Twitter” humming to ensure the social network can develop new features, Musk expects the social network to take up far less of his focus.
“In the grand scheme of things, the amount of cognitive load that Twitter represents is low. I mean, it is a much simpler problem than Tesla or SpaceX, obviously, by a hundred miles,” Musk said.
“I’d say it was a high cognitive load for about a month. At this point, it is a moderate cognitive load. A month from now, it’ll be, I think, low,” he continued.
“And if I look back and say, like: ‘What are actions I could have taken? Was there something that I failed to do at Tesla that could have been done and would have improved our execution?’ I literally can not think of a single thing.”
Musk noted that he hadn’t missed a single important meeting at Tesla since taking over Twitter, with both primarily based in the Bay Area of San Francisco.
‘Serious Recession’
The real issue is not how much time Musk might be putting into Twitter versus Tesla; according to the billionaire, it is the Federal Reserve’s “radical interest rate changes” pushing up the price of cars. Musk predicted a “serious recession” next year “comparable to 2009,” with decreasing demand for big-ticket items like vehicles.
With respect to global demand for vehicles, Musk said that interest rate rises push up the costs of both new and used cars, which he noted are mostly bought with leases and loans. He said a decrease in car demand, along with the Fed’s rate increases pushing up the cost of a car, creates a “double whammy.”
“So now you have structural demand, which is obviously going to be lower in a recession, and you’ve amplified the effect of cost of a car because they’re almost all bought with debt, so you get a double whammy, is what I’m saying,” he said.
Policymakers at the Federal Reserve voted at their last monetary policy meeting on Dec. 14 to hike the benchmark federal funds rate by 50 basis points to a target range of 4.25–4.5 percent, the highest level since late 2007. It was the seventh consecutive rise since March, totaling 425 basis points.
Fed Chair Jerome Powell said at a press conference after the meeting that the fight against inflation has a long way to go. Most officials expect rates to rise over 5 percent next year, which is more than originally predicted.
“I wouldn’t see us considering rate cuts until the committee is confident that inflation is moving down to 2 percent in a sustained way,” Powell said.
‘Hard Landing’
Musk rejected the idea that his political tweets are having an impact on Tesla share prices, contending that automotive demand is “problematic almost anywhere in the world” and “not everywhere cares about my political comments.”
“I really just don’t think this is a significant factor,” he said.
In Musk’s opinion, the U.S. economy is already in a period of deflation, and the Fed’s predictions are based on old data.
“The thing that I think most people don’t realize is how—I sound like a broken record on this—how big of an impact the Fed rate level is, at over 5 percent, if we are in a deflationary environment, which I think we are in,” he said.
“Objectively, we are,” he added.
Musk said it was “blowing my mind” that the Fed has raised rates to their current level, and said he believes that they are “dealing with old information.”
“The economy right now is like a car driving around on a cliffside road, and the Fed is driving it by looking out the rearview mirror,” he said. “In fact, it’s not even looking out the rearview mirror. It’s looking at a video taken out of the rearview mirror that’s like three months old. So obviously, this is not a good way to drive a car on a windy road.”
The Epoch Times has contacted the Federal Reserve for comment.
Why One Survival Food Company Shines Above the Rest
Let’s be real. “Prepper Food” or “Survival Food” is generally awful. The vast majority of companies that push their cans, bags, or buckets desperately hope that their customers never try them and stick them in the closet or pantry instead. Why? Because if the first time they try them is after the crap hits the fan, they’ll be too shaken to call and complain about the quality.
It’s true. Most long-term storage food is made with the cheapest possible ingredients with limited taste and even less nutritional value. This is why they tout calories so much. Sure, they provide calories but does anyone really want to go into the apocalypse with food their family can’t stand?
This is what prompted the Llewellyns to launch Heaven’s Harvest. They bought survival food from multiple companies and determined they couldn’t imagine being stuck in an extended emergency with such low-quality food. They quickly discovered that freeze drying food for long-term storage doesn’t have to mean sacrificing flavor, consistency, or nutrition.
Their ingredients are all-American. In fact, they’re locally sourced and all-natural! This allows their products to be the highest quality on the market, so good that their customers often break open a bag in a pinch to eat because they want to, not just because they have to due to an emergency.
At Heaven’s Harvest, their only focus is amazing food. They don’t sell bugout bags, solar chargers, or multitools. They have one mission – feeding Americans in times of crisis.
What they DO offer is the ability for people to thrive in times of greatest need. On top of long-term storage food, they offer seeds to help Americans for the truly long-term. They want them to grow their own food if possible which is why they offer only Heirloom, Non-GMO, Non-Hybrid, Open-Pollinated seeds so their customers can build permanent food security on their own property.