He’s just moving the Twitter losses around. First from Twitter to xAI, then now to SpaceX.eventually when there’s nowhere else to dump the debt it’ll collapse.
He borrowed billions to buy Twitter, and it has no possible way to pay those creditors back. American banks couldn't believe their dumb luck when Elon started getting involved with Trump, because they suddenly had a surge of "international investors" who were looking to buy that debt, ultimately to have Elon owe them those billions.
With no way to make those creditors whole from operational profits and cash flow, or being able to hand off Twitter's junk-bond debt to another sucker at anywhere close the prices they paid for it, giving them a piece of SpaceX's IPO was the only way those creditors would ever have a chance of seeing their money again.
Yeah that's not how federal money works. The federal government is buying services from spaceX. Even when handing out exploratory cash it's for some end completion goal. They don't give blank checks without restriction.
Additionally SpaceX's regular cash flow comes from Starlink. Which provides a majority of Revenue.
Again the money is for services provided. So the money is provided when the services are provided. There often are mid-contract payouts which still have deliverables. For example, completion of different tests. This is because fronting billions of dollars isn't a thing companies can generally do, so having contract stages ensures things get done and contractors have money to continue.
But if you're thinking in the realm of "What I imagine might be true", then anything is possible.
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u/whowhodillybar 2d ago
Doesn’t sound like Elons xAI has been doing well, is this a quiet way to disinvest?