Elon Musk slams indexing, regulators in public markets rant

investmentnews.com:

Elon Musk is lashing out at the state of US financial markets.

In a wide-ranging talk with ARK Investment Management’s Cathie Wood Thursday, he bemoaned the high regulatory burden faced by publicly traded companies, the pressure from shareholders that limits efficiency, and how passive investing is stoking volatility.

The complaints add to a litany of grievances Musk has raised over the years about the tradeoffs of tapping public markets to build some of his many ventures. His disdain for the rigidity of US securities laws has sometimes led to trouble with regulators, including a high-profile fight with watchdogs over tweets about Tesla Inc. Musk is also the chief executive of SpaceX, one of the world’s most valuable closely held companies.

“There’s a lot of pressure, like immense pressure on a public company to not have a bad quarter. So this can actually result in a less efficient operation where you’re going to great lengths at the end of the quarter to not disappoint people,” Musk said in a Spaces discussion streamed live on the social-media platform X. The “time horizons do not match between investors versus a company’s long-term vision.”

— Cathie Wood (@CathieDWood) December 21, 2023

Musk has tangled in the past with the Securities and Exchange Commission, which he dubbed the “Shortseller Enrichment Commission” in 2018. That year, the billionaire agreed to pay a $20 million fine to resolve the agency’s complaints about tweets suggesting he was taking Tesla private. As part of the deal, he agreed to clear future posts about his firm with an internal monitor, or “Twitter sitter.”

Musk later bought the social media platform, renaming it X. Earlier this month, he asked the US Supreme Court to consider invalidating that