Tesla’s Bitcoin investment “a distraction” from quality issues, says investor Big Short
Tesla’s recent $ 1.5 billion investment in Bitcoin is a distraction for Chinese regulators looking into consumer complaints about quality issues, Big Short investor Michael Burry said on Monday in a series of deleted tweets. .
Burry, who predicted the housing collapse in 2007 by acknowledging a market bubble, has been particularly bearish on TSLA stock in recent memory. In January, Burry took to Twitter to say the automaker’s investors “should profit while it lasts,” speaking of Tesla’s 700% rise in value on Wall Street last year.
Michael Burry was the subject of the Hollywood hit “The Big Short”, a novel turned into a film directed by Steve Carrell and Christian Bale that showed the story of the 2007 housing collapse. Burry made billions in earnings after he put on $ 5 billion shorts and says Tesla’s situation is eerily similar to the housing crisis that happened almost a decade and a half ago.
“Chinese regulators are calling Tesla over quality issues as consumers complain about quality… but $ TSLA bought $ BTC,” Burry said. “In my mind, so many #digital confetti. “
Five separate Chinese regulatory agencies summoned Tesla after complaints were filed by buyers of Model 3. The State Administration for Market Regulation, or SAMR, said the battery fires and abnormal acceleration were two of the main concerns addressed, CNN noted. The battery fire issues could relate to a recent parking garage fire involving a Model 3 whose battery was damaged after being punctured during a drive. Tesla said the vehicle in question likely damaged its undercarriage and battery, Chinese outlets reported.
Regarding Chinese regulators, Tesla posted a statement on its official Weibo account:
“Tesla sincerely accepts advice from ministries, thinks deeply about the company’s shortcomings in the business process, and comprehensively strengthens self-inspection. We will strictly abide by Chinese laws and regulations and always respect the rights of consumers. At present, the company strengthens the internal working mechanism and process under the leadership of the relevant government department, and strengthens the internal management in all aspects. For the problems reported by consumers, we will systematically investigate, effectively implement the protection of the rights and interests of consumers, continue to implement the primary responsibility for the quality and safety of the enterprise, effectively maintain the safety public service and better contribute to the healthy and healthy development of China’s new energy vehicle market in the future.
Burry added to his flurry of tweets disapproving of Tesla’s Bitcoin investment.
“The correlation coefficient $ TSLA and $ BTC is 0.951967 in the last six months,” he said, according to Business intern. “@Elonmusk looking for perfect unity? No, Elon dreams of the impossible. He is determined to shatter unity. Correlation> 1. And he has history on his side. Investors in $ TSLA and $ BTC can do it all.
However, Tesla’s $ 1.5 billion Bitcoin investment is not frowned upon by all investors. Tasha Keeney of ARK Invest said the investment opens the door for easier international expansion, especially when it comes to corporate cash flow issues. It is easier to deal with one internationally accepted form of currency than it is to have multiple forms of international currency to convert. The risk of dealing only with Bitcoin is less serious than dealing with the volatility of so many forms of payment used internationally.
Tesla Shorts are coming off a major year of defeat, reporting losses of $ 38 billion after the share price gained 700% last year.
Disclosure: Joey Klender is a shareholder of TSLA.