Rosalind Evans
In an eventful year marked by significant developments across various sectors, Elon Musk’s actions have emerged as a pivotal factor potentially impacting investor portfolios. As the world’s richest man embroiled himself in controversies, his decisions have echoed across the financial landscape, affecting companies like Tesla and Twitter (referred to as “X” in the quotes). Meanwhile, global occurrences, such as the lowest unemployment rate in 2022 and disruptions in the Red Sea affecting Ikea, also shape the current economic narrative.
Elon Musk’s involvement in various scandals in 2023, including endorsing antisemitic tropes and re-platforming conspiracy theorists, has raised concerns about his influence on investor portfolios. His controversial actions have led to a significant drop in ad revenue for “X,” with Musk admitting a potential failure of the company he acquired for $44 billion. This situation poses a risk not only to his private investors but also to Tesla shareholders. Tesla’s market value is about $801 billion, so its performance affects many Americans’ retirement savings.
The fluctuations in Tesla’s share prices reflect Musk’s public actions and their repercussions. Jauron Gunther Dam’s research at Georgia Southern University suggests that Musk’s frequent tweeting negatively impacts Tesla’s stock performance. Shareholders, including Jerry Braakman and progressive Tesla investors, have voiced concerns over Musk’s leadership, urging more focus on Tesla amid increasing competition and internal challenges.
In a broader context, the labour market witnessed remarkable strength in 2022, with the lowest unemployment rate ever recorded at 7.6%. This resilience continued into 2023 despite the Federal Reserve’s efforts to control inflation through interest rate hikes.
Global trade also faces challenges, with Ikea experiencing delays due to Houthi rebel attacks in the Red Sea. This disruption, affecting significant companies like BP and Maersk, underscores the fragility of global supply chains.
The juxtaposition of Elon Musk’s controversial year with significant global economic developments paints a complex picture of the current market landscape. While Musk’s actions have a tangible impact on companies like Tesla and “X,” the broader economic environment, from record-low unemployment rates to disruptions in critical trade routes, also plays a crucial role in shaping investor decisions and market stability.
