The social media platform X has lost 71% of its value since it was bought by Elon Musk, according to the mutual fund Fidelity.
Fidelity, which owns a stake in X Holdings, said in a disclosure obtained by Axios that it had marked down the value of its shares by 71.5% since Musk’s purchase.
Musk acquired Twitter for $44bn in October 2022 and renamed the platform X in July 2023. Fidelity’s estimate would place the value of X at about $12.5bn.
The number of monthly users of X dropped by 15% in the first year since Musk’s takeover amid concerns over a rise in hate speech on the platform.
It never was. I argued with people on Hacker News at the time, and those idiots I was arguing with think that if someone is foolish enough to overpay for something, it’s worth the amount they paid.
They literally believe that if someone pays a million dollars for a box of dirt, that box of dirt is worth a million dollars - no concept that it’s only worth what you can sell it for.
I mean, what is your alternative definition of “worth” if it isn’t “What you can get for it”
Like you’re right that a valuation of something is not definitive to something’s worth, until somebody, anybody is willing to buy it for that much. After which, the worth could change.
So if I sell a box of first for $1 million, and somebody is willing to buy it, it is in fact worth $1 million. However once that fella buys it, it isn’t necessarily still worth $1 million anymore.
The alternate definition is “discounted future earnings”.
So if I have a cardboard box with $100 inside, it’s worth $100 even if nobody will buy it.
If I have a machine that will print an authentic $100 bill exactly once, it’s worth $100 even if nobody else believes it will work.
Thus, something can be worth more (or less) than its selling price.
The $100 contained inside the box wouldn’t be the box’s “worth”, it would be part of the box’s worth. It would be $100 PLUS whatever somebody is willing to pay for the box itself.
The $100 inside the cardboard box is Twitter’s physical assets. But the current physical assets owned by Twitter are only part of the equation, there is still an inherent worth in owning the company itself, and possible income in the future.
That doesn’t make the box’s worth $100 or $0, it makes the box’s worth “At least $100”.
But how do you define the value of a $100 bill? Is it worth one hotdog, 100 hotdogs or as many hotdogs as someone is willing to trade for it?
“Worth” and “Price” are different things. A meal that costs $20 has more worth than a box of dirt with a price sticker of $1 million.
The $44 billion Muskolini paid was Twitter’s agreed price, not it’s worth.
Not if somebody actually buys the box of dirt for $1 million. If the price sticker of $1 million doesn’t inherently assign it its value, then neither does the $20 price sticker on the meal.
You could say what makes the meal worth $20 is the fact that somebody is willing to actually pay the $20, but then the box of dirt also has somebody willing to pay $1 million dollars for it.
So if “worth” isn’t equal to the price tag, or what people are willing to pay for it, then what are you basing the worth on?
Yes, and I was inundated with techbros claiming that’s not how it works. I mean there is some argument in some cases where you can get some tax write off based on losses, but a true valuation is only what you can sell for.
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Oh yes then you were 100% right lol.
I’d say worth would be an average of all possible sale prices for an asset. As opposed to the single sale price to a megalomaniac.
That doesn’t make much sense.
Suppose I have a trinket that everyone knows you are willing to pay $100 for.
If I offer it to someone else, they should be willing to pay me something pretty close to $100. Because if I sell it to them for $99, then they can sell it to you for $100.
And in fact as soon as Elon announced he wanted to buy Twitter, the stock price shot up. Other people wanted to buy it for nearly the same price, in order to sell it to Elon.
Sounds more like the market wanted to play Elon for the fool he is. Especially considering the depreciation thus far. But hey, I don’t think he bought it for money. I think he bought it to silence his critics, destabilize an organizing platform, and get buddy buddy with the “right” people by allowing Nazis and crypto fascists back on the platform.
It’s not just Elon. If any company is being bought out at $X/share, then the stock price will quickly approach $X.
Once someone is willing to buy at $X, everyone else won’t sell for much less than $X. Imagine you have an old vinyl record and today you learned that some people are paying $100 for it. Maybe it wasn’t worth much to you yesterday, but now it’s worth a lot to you too.
All the possible sale prices for an asset would be infinite, how do you average infinity?
… Are you intentionally being obtuse or something?
…No. how exactly would you go about finding the average of every single possible sales price of an asset.
And they call Economics a science.
Calculus?
What’s the calculus equation for taking the average of every number?
https://en.m.wikipedia.org/wiki/Series_(mathematics)
The specific values to be added are an exercise for the reader.
I remember when hackernews was pro-NFTs.
I swear real engineers don’t use hackernews, and it’s full of wannabe startup dudes and rise-and-grind folks.
You may be right. I’ve also noticed it seems the user base has changed over the years. It used to be that many of the people on HN were actually devs and many of them were based in Silicon Valley. Many commenters in years past were closely connected to the companies and people in the bay area tech scene. That’s no longer the case.
Recently, I saw a thread regarding Netflix releasing their streaming data - and there were multiple people starting the reasons why Netflix released the data, and they were authoritatively posting that is was a strategic move, or that they were positioning their ad sales teams to have ammunition for 2024.
Then, a few days later, it was revealed that the reason Netflix released their stats was that is was part of the new SAG agreements. Not ONE of the Hacker News ‘experts’ were even close. Not ONE of them even mentioned the new SAG contract. They had no idea what they were talking about.
Yeah, feels like a real misunderstanding of what one person is willing to pay vs what people are willing to pay.