Tesla Stock Is Sliding on More Musk Antics. The Surprise Is the Rest of the Market Isn’t.

While there is a broader conversation to have about billionaires paying enough taxes, in the near term, Musk’s social media interventions are undoubtedly becoming less and less amusing to Tesla investors. His comments last week that a deal with rental-car company Hertz hasn’t yet been signed caused a similar premarket tumble.

Musk has repeatedly said Tesla is overvalued, and the stock has surged in recent months. So perhaps he is set on selling some stock but hoping to frame it as listening to his followers. He also faces a possible tax bill of $15 billion on stock options in the coming months, CNBC reported.

Tesla now is so large that its weight in the S&P 500 is only just below that of the entire energy sector. So it is remarkable, if not worrying, that futures on the benchmark index were as stable Monday morning as Musk’s actions are volatile. Investors are ignoring a big red light right in front of them.

—Callum Keown

*** Join Barron’s senior managing editor Lauren R. Rublin and deputy editor Ben Levisohn today at noon as they discuss the outlook for financial markets and individual stocks, and talk about how to spot a bubble. Listen here.

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Twitterverse Tells Elon Musk to Sell 10% of His Tesla Shares

Tesla CEO Elon Musk asked his 62.7 million Twitter followers if he should sell 10% of his stock in the company, vowing to abide by what the poll said. More than 3.5 million weighed in, and the final vote count was 58% “Yes,” and 42% “No.”

• Musk posed the online poll amid a national debate over whether the ultrarich are paying their fair share of taxes. Congress recently considered, then dropped, a plan to tax the unrealized investment gains of billionaires to help pay for the Biden administration’s $1.85 trillion social spending plan.
• Musk, whose estimated wealth of $338 billion makes him the world’s wealthiest man, said because he doesn’t receive a cash salary or bonus as CEO of Tesla and of privately held SpaceX, “the only way for me to pay taxes personally is to sell stock.”
• Senate Finance Committee Chairman Ron Wyden (D., Ore.) on Saturday responded to Musk’s Twitter poll, saying: “Whether or not the world’s wealthiest man pays any taxes at all shouldn’t depend on the results of a Twitter poll. It’s time for the Billionaires Income Tax.”
• Tesla’s shares have risen about 75% in value over the past three months, including a 43% jump in October after Hertz Global Holdings announced plans to order 100,000 Tesla vehicles for its rental fleet. Last week, Musk tweeted that no deal with Hertz had been signed.

What’s Next: Musk owns 17.2% of Tesla’s shares, or 170.4 million, according to FactSet. Selling 10% of those shares could yield about $21 billion, based on Friday’s closing price of $1,222.09.

—Janet H. Cho

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Biden Looks to Rollout of $1 Trillion Infrastructure Plan

President Joe Biden is expected to hold events nationwide this week, including a trip to Baltimore’s port on Wednesday, to tout the $1 trillion infrastructure bill that has gone to his desk for signature, before turning his attention to pushing through the $1.85 trillion package of social and climate change spending.

• Biden said he would sign the infrastructure bill as soon as lawmakers could join him at a formal signing ceremony. Congress is taking a week-long break now, scheduled to return Nov. 15 facing a number of agenda items.
• Sen. Bernie Sanders (I., Vt.) said conservative House Democrats committed to vote for the $1.85 trillion social and climate spending plan no later than the week of Nov. 15. House Speaker Nancy Pelosi said the bill will pass “when the House returns” that week.
• The bill includes spending on upgrading the nation’s energy grid and moving toward clean energy, including $5 billion for a national network of electric-vehicle charging stations, $2.5 billion to electrify school buses, and funding to upgrade transmission lines and other electric-grid infrastructure.
• Energy Secretary Jennifer Granholm said Sunday that Americans will pay more to heat their homes this winter, with projections for natural gas costing 30% more and heating oil costs rising 43%. The Energy Information Administration will update those projections this week.

What’s Next: Tom Block, Washington policy strategist at Fundstrat Global Advisors, told Barron’s infrastructure spending should have “a positive impact for years to come” as projects on roads, bridges and high-speed railway get under way. He doesn’t expect the larger bill to be finished until “closer to Christmas than Thanksgiving.”

—Janet H. Cho

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SoftBank’s Vision Fund Reports Record Loss

SoftBank Group said Monday that its Vision Fund booked a 825.1 billion yen ($7.3 billion) loss in the quarter ended in September, as chairman Masayoshi Son announced a $8.8 billion share buyback program, to be deployed over the next 12 months.

• The Vision Fund, SoftBank’s Saudi-backed flagship investment vehicle, suffered severe losses due in part to the group’s holdings in South Korean e-commerce giant Coupang , the value of which fell by $6.7 billion.
• The value of SoftBank’s investment in Didi , the Chinese ride-hailing company, declined by $6.1 billion, and the stake in online property platform KE Holdings lost $2.2 billion in value in the quarter.
• The SoftBank group lost 397.9 billion yen overall in the period.
• The 1 trillion yen share buyback plan’s announcement comes after pressure from some major SoftBank investors such as activist hedge fund Elliott Management. SoftBank had already completed a massive, 2.5 trillion yen buyback program in May.

What’s Next: A second SoftBank fund will focus its investments in other parts of the world, notably on Indian companies. Son and other company managers have decided to take a stake of 17% in the so-called Vision 2, in a bid to convince outside parties to invest in the new venture.

—Pierre Briançon

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White House Officials Defend Biden Administration’s Vaccine Mandate

U.S. Surgeon General Dr. Vivek Murthy on Sunday defended the Biden administration’s vaccine mandates for companies, telling ABC that when the U.S. has come so far but is still seeing 75,000 new infections a day, it’s important to take “every measure possible to make our workplaces safer.”

• When asked about the 27 states that have filed suit against the rule, Murthy said, “what’s really hurting the economy is actually Covid itself.” Companies that have imposed mandates have seen their vaccination rates increase 20%.
• The Fifth Circuit Court of Appeals in New Orleans temporarily blocked new federal rules requiring employers with 100 or more workers to make sure they are vaccinated or tested weekly by Jan. 4. Seema Nanda, the Labor Department’s top legal advisor, said the Occupational Safety and Health Act gives the government the authority to act.
• White House chief of staff Ron Klain told NBC he was confident the vaccine mandate would be upheld, saying if Labor Department rules “can tell people to wear a hard hat on the job, to be careful around chemicals, it could put in place these simple measures to keep our workers safe.”
• Apple will drop mask requirements at many U.S. stores, Amazon.com told fully vaccinated warehouse workers they can stop wearing masks, and JPMorgan Chase has relaxed its mask rules at U.S. locations with high vaccination rates. Federal guidelines still recommend masks in high-transmission areas.

What’s Next: The U.S. is lifting restrictions on international travelers starting today. Visitors flying to the U.S. must show proof of vaccination with an approved vaccine and a negative test result within three days of travel, with limited exceptions. Visitors coming in by land only need proof of vaccination.

—Janet H. Cho

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Buffett’s Berkshire Hathaway Has Record Cash Pile

Warren Buffett has a record amount of money to acquire companies or otherwise put to work at his conglomerate, and yet it seems as if the only deal he has been making lately is in buying shares of Berkshire Hathaway’s stock.

• Berkshire Hathaway ’s cash pile was $149 billion at the end of the third quarter, but Buffett and his investment team haven’t made a substantial deal lately. Instead, Berkshire bought $7.6 billion of its own stock in the quarter.
• So far this year, Berkshire has bought $20.2 billion of its own stock after changing its policy on buybacks three years ago. The B shares of Berkshire are up 24% so far this year compared with the S&P 500’s 25% gain.
• At the same time, Berkshire sold a net $2 billion of stocks in the quarter, according to estimates by Barron’s, based on information in Berkshire’s third-quarter regulatory filing.
• Buffett’s company is closely followed for its stockholdings, which totaled $310.7 billion at the end of the quarter. Its largest holding, shares of Apple, totaled $128.4 billion on Sept. 30, or 907 million shares.

What’s Next: Buffett has said that prices to acquire companies are high, as private-equity firms and blank-check companies compete for transactions.

—Liz Moyer

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MarketWatch Wants to Hear From You

As the pandemic continues to disrupt airline operations, how can Americans prepare themselves for traveling during a potentially chaotic holiday season?

A MarketWatch correspondent will answer this question soon. Meanwhile, send any questions you would like answered to [email protected].

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—Newsletter edited by Liz Moyer, Camilla Imperiali, Steve Goldstein, Callum Keown