Elon's package is Peak Meme Fuckery

You probably heard that Tesla shareholders approved a $1 Trillion pay package. That's not entirely correct, in fact the way that this has been reported is quite misleading; what they approved is a series of stock performance and productivity stairsteps designed to meme Tesla into the stratosphere.

The original filing is here; it's Proposal Four (for those who like to consume the original docs.)

All-in-all it's meme-era PR genius; the immediate and predictable response from the media is "OMG, they're paying this guy $1 Trillion while 40 million people on SNAP starve" and making it appear to be a well-accepted fact that we live in a universe where in 10 years

• There will be 1 million self driving Tesla taxis in commercial use
• Tesla will be making $400 Billion per year profit.
• There will be 1 million humanoid robots surrounding us
• Telsa will have valuation in excess of $8.5 Trillion.

Essentially, Elon is awarded 35,311,992 Tesla shares every time he achieves a performance benchmark. Each performance benchmark is a sustained market capitalization plus some other milestone, starting with more attainable milestones like vehicles delivered or FSD subscriptions sold. The first goal is $2T market capitalization. If there is a six month period in which the trailing average of Tesla's market cap exceeds $2T, and Elon gets 35,311,992 shares, or 1% of total, which would be valued at about $20B. Then there's another benchmark at $2.5 T and so forth, up to $8.5 T.

Some of these are doable, some are insane: The only corporation in history to have breached $140B in EBITDA is Saudi Aramco, which pulls oil out of the ground and sells it at a massive markup to the entire world. Tesla is currently about $15B.

The full list of milestones

• 20 Million Tesla Vehicles Delivered
• 10 Million Active FSD Subscriptions
• 1 Million Bots Delivered
• 1 Million Robotaxis
• $50 Billion of Adjusted EBITDA
• $80 Billion of Adjusted EBITDA
• $130 Billion of Adjusted EBITDA
• $210 Billion of Adjusted EBITDA​
• $300 Billion of Adjusted EBITD
• $400 Billion of Adjusted EBITD
• $400 Billion of Adjusted EBITD
• $400 Billion of Adjusted EBITD

(Nice nod to Fibonacci in there)

The $1T total package number the media is throwing around is accounting for the appreciation in the maximum scenario - Even while his first tranche of shares is only worth $20B when he gets it, these are then worth $85B later when he reaches the highest threshold. If he only reaches $2T and gets the EBITDA up to $50B and it stays there, Elon will only have earned a $20B bonus, not quite $1T.

A Balaji-Bet and Elon's staircase

This PR genius here is to incorporate two instruments in memeconomics 1) An incremental stairway to heaven and 2) a Balaji-Bet. In this golden age of memes, suggestibility and reality are hard to distinguish. There mere suggestibility may allow some milestones to behave like self-fulfilling prophesies The stock valuation is an obvious example.

Imagine if someone told you that in 10 years Samsung would have delivered 1 million humanoid robots. You'd be quite skeptical, probably dismissive. But if you learned that there was $1T riding on this bet, and it would involve the company earnings doing a 25x, and many people are following and participating in this bet, and New York Times was reporting it as if it was a done deal, you might take it seriously. You might even go to their website and check out the prototypes.

Not only does it become imaginable, it becomes participatory. Drink the Kool-aid, join the team of cyber-hornets. You can buy the stock, you can look into maybe preordering one of the robots. What will you name him (her, or they?) Will you bring the bot on your yacht after you retire with your Tesla profits - or maybe leave Fibonacci (he's got a name now) to look after your home while you travel. Many possibilities. Or maybe you get two bots, ever think of that?

The Balaji-Bet works similar wonders on the greedy mind. You think surely, this is stupid, but, then again, is it stupid? Obviously $1M Bitcoin is not going to happen this year, but who says it can't happen next year? It's already gone up several orders of magnitude, what's one more?

Meme Psychology

Let's play this forward. Today Tesla's marketcap is around $1.4 T. So it has to go up about 50% and stay there for six months to get the first milestone. (Modulo one of the other operational milestones are achieved.) Reasonable, right? Very. The more you think about, the more it seems almost guaranteed: Elon is going to make sure he's going to get that goal, and all of his fans and supporters are going to help him. He might borrow money against his bags to bid the price up, he might make false promises about deliverables. But his main job, his job for which he has trained his entire life - will be to convince everybody that $2T is an inevitable self-fulfilling prophesy.

Once the price starts to move in that direction, the inevitability will become clear, and those who bought earlier will be rewarded for their trust in the process. Basic FOMO comes in: Since we all are quite certain that the stock will increase by 50% and stay there, we can make easy money loading up the stock now and taking a few profits in the 6 month period. Everybody will be doing it, you will feel so stupid if you miss such an obvious trade.

But maybe people don't sell when in hits $2T. Just another 25% and we're at $2.5T. Certainly Elon won't falter to get it here, nor will his crowd of Tesla fans want this to end. Onward to $3T!

You see how this goes. Each is next step is an inevitable, achievable stairstep.

We already know that Tesla's price is largely divorced from fundamental metrics like P/E - so going from 250 P/E to 300 P/E to 400 P/E isn't a leap out of bounds. The GameStop rally didn't really have an endgame or any levels to unlock.. Bitcoin has had a series of goals ("laser eyes to $100k") but these are just numerological signs that aren't tied to anything - Satoshi doesn't get to print themself new Bitcoins if the price of Bitcoin averages over $100k for six months.

Bitcoin infinite loopers have been explaining this for 15 years and have been rewarded : Bitcoin is risky at $10 but there's a chance it might go to $100, where's it's mildly risky but with a chance it goes to $1000, where it seems perhaps less risky, now that more people have bought in, plus there's the chance it goes to $10000, which now seems likely, especially since by then the next stop will be $100k, which makes $1M seem inevitable. They were right, it's now at $100k and certainly there's a 1/10 chance it goes to $1M The mere suggestibility of all these outcomes make the outcomes attainable.

But are the operational objectives doable?

The stock prices can be memed up an order of magnitude. That's the easy part. But can Elon achieve any of these other things? It depends on Tesla developing new revenue streams that they don't have.

But if this whole thing becomes a participatory meme, anything is possible.

Elon's politics are slithery; he would embrace Mamdani in a heartbeat if Mamdani promised to contract Tesla for 100,000 robotaxis. He'd certainly be happy to supply ICE with a million border patrol droids. Don't worry, he'll let us know which party we need to vote for to help him.

And just like that we're using our imagination, expanding our Overton Window to include a world in which Elon's robots are running everything, and we got rich by frontrunning it all.

Without the Elon cult, these objectives seem laughable. No corporation has come near the $400B EBITDA, ever, but that doesn't mean it's not possible.

We also don't know what financial games Tesla and Elon could get involved with. Tesla could raise money by diluting (raising market cap in the process), and then0 investing this into xAI, spaceX or one of his other companies, who could contract back for some robots. Or these other companies could just borrow massive amounts of money at near zero interest rates, and pump this into Tesla contracts. Nobody would look down on this (except for the haters who already hate Elon.)

Much Elon, Very Dystopia

Elon has clearly made it his goal to be some Palpatinic Tech Emperor of Universe. His skills are amassing capital, using leverage and vertically integrating. Step 1 was to convince the world he was somehow capable of unimaginable feats; There's a ton of people who have bought this. There's also many other people who, while they haven't bought into the superhero fantasy, they've bought into the profitable proposition that other people will continue to buy the superhero fantasy and so you can get rich by frontrunning; of course there's people who are frontrunning them.

As he knows, taking the impossible to the imaginable to the inevitable is just meme psychology.