Don’t Blame Elon Musk for Being the Richest Man on Earth – He’s Just the Product of a Flawed System
A great reset is necessary.
Humans are living beings apart. We all dream of becoming rich, and when we see ultra-rich humans being constantly highlighted by the media, we end up hating and blaming them. As such, the unofficial title of the richest person on the planet is not something so desirable in reality.
Bill Gates held this role throughout the '90s and 2000s, and it made him hated by many people who denounced the excesses of capitalism. It is probably for this reason that Bill Gates decided in the early 2000s to withdraw from Microsoft to devote himself to philanthropic activities through his foundation.
After about 20 years, we can say that his image has changed positively in the general public's hearts.
Bill Gates and then Jeff Bezos have been under fire for being the richest man in the world
In the second half of the 2010s, it was Jeff Bezos who became the richest man on the planet. He then drew criticism from all sides about the disastrous working conditions at Amazon for the least qualified and lowest-paid workers. Jeff Bezos has become the symbol of billionaires who take advantage of the exploitation of the poorest to enrich themselves indecently.
The fact that he then invests a large part of his fortune in the conquest of space rather than in helping his fellow human beings on Earth has also been much decried. It is probably also for this reason that Jeff Bezos has just decided to leave his position as CEO of Amazon to devote half his time to philanthropic activities.
Like Bill Gates in his time, Jeff Bezos has been reviled because of his unenviable title of the richest man on the planet.
Jeff Bezos must have seen with some pleasure that Elon Musk had finally surpassed him as the richest man on the planet since September 2021. This will allow him to be spared from criticism. If the situation is the same as before concerning him, the fact that a man is richer than him will attract the majority of criticism.
It is always so. It is the richest man on the planet who is the most exposed and therefore the most criticized.
It's now Elon Musk's turn to be singled out with a fortune that briefly exceeded $300 billion
With his fortune reaching virtually 330 billion dollars until 10 days ago, Elon Musk has been pointed out by American politicians as a symbol of those American billionaires who saw their fortune explode during the COVID-19 pandemic, but who do not contribute enough to the American system by escaping taxation.
It must be said that Elon Musk has chosen not to receive a salary as CEO of Tesla for over ten years. Instead, he had obtained options on Tesla shares to be exercised for ten years at his convenience. Elon Musk got this in 2012 and 2018.
Elon Musk's wealth is therefore composed of the valuation of his Tesla shares and his shares in SpaceX mainly. All this does not allow him to be taxed since his wealth is mostly made up of unrealized gains. Hence the idea launched by some politicians to create a special tax for unrealized gains targeting American billionaires.
This tax raised a general outcry and was finally dropped from Joe Biden's infrastructure project that has just been voted by the American Congress to build the America of tomorrow.
Elon Musk sold Tesla shares not to pay taxes, but simply as a logical strategic move
At the beginning of last weekend, Elon Musk took the opportunity to launch a poll on Twitter asking his 63 million followers if he should sell 10% of his Tesla shares or not. Elon Musk then played the card of the billionaire who cannot pay taxes other than by selling his shares because he does not receive a salary.
His followers who love his way of communicating have voted massively for the yes to more than 57%. Elon Musk said he would do it. In the aftermath, Tesla's share price collapsed on the stock market liquidating in two days more than 180 billion dollars at the beginning of the week of November 8, 2021.
In reality, Elon Musk had planned to sell Tesla shares since September 2021. It was already written in black and white and decided. Elon Musk had to sell shares to recover cash to exercise options from 2012 expiring in 2022. These options gave him the possibility of buying 22.86 million dollars of Tesla shares at $6.24 per unit. With Tesla's stock above $1,000, Elon Musk would have been crazy not to make such a strategic move.
Over the week, Elon Musk sold more than 6 million Tesla shares, giving him the equivalent of $6.9 billion in cash. Elon Musk took profits at the right time since Tesla's market cap has exploded since the beginning of the COVID-19 pandemic. In the end, Elon Musk comes out ahead as he has more Tesla shares than before while having more than $5 billion in cash after paying the taxes he had to pay.
If his estimated wealth has dropped in recent days below $300 billion to just above $270 billion, this is probably only temporary. Indeed, Tesla's share price may be recovering now that this episode is over.
Elon Musk is simply the product of a flawed system
In reality, Tesla's stock market explosion over the last eighteen months is more due to the flaws of the current system than to Elon Musk's genius. Thus, it seems to me useless to blame Elon Musk for the fact that he is the richest man on the planet and that he prefers to use his colossal means to colonize Mars or dominate the electric car market rather than to help solve world hunger.
The current system gives full power to central bankers to print as much fiat money out of thin air as they deem necessary. This is the original sin among the seven deadly sins from which the current system suffers. Since the beginning of the COVID-19 pandemic, the Fed has printed out of thin air more than 35% of all US dollars currently in circulation. This ultra-accommodating monetary policy conducted by the Fed has been accompanied by a reduction in key interest rates to zero and a massive program of buying back at least $120 billion in assets each month.
American investors were thus literally pushed into the equity market via a TINA effect ("There Is No Alternative"). Tech companies have benefited fully from these massive investments by retail investors and a FOMO effect has been created around tech companies' shares. At the top of the list is Tesla, whose market cap has exploded. The latter represented more than 330 times its profits until a few days ago!
Elon Musk's fortune has exploded at the same time since he owns more than 20% of Tesla's shares.
Final Thoughts
Instead of blaming Elon Musk unfairly, you should blame an unfair system that has allowed American billionaires to see their wealth increase by more than $2.1T in only eighteen months. The Cantillon Effect is at work here with the ultra-rich getting richer and richer while the poor are suffering more and more daily due to inflation that has reached 6.2% in October 2021 in America. A first since 1990...
The current system shows its limits in broad daylight and if Elon Musk is not free of reproaches for some of his excesses, you should rather fight to demand a great reset of the current monetary and financial system to obtain more justice for the greatest number.
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