This is funny to me, because I told my wife just before the IPO that one of the first things they would do would probably be to buy an AI company. Because XAI is shit and probably just about worthless. But with the IPO they would get the money to buy something.
But Cursor looks like a pretty week addition, just 1½ year ago cursor was bid up to $ 2.5 billion, up from a seed capital 2 years earlier of only $8 million!SpaceX paying $60 billion now seems insane, and it reeks of a bad deal, entering at just the wrong time.
https://en.wikipedia.org/wiki/Cursor_(company)
In April 2025, an AI help-desk program named “Sam” invented a non-existent login policy, triggering user cancellations before staff intervened and issued refunds.
So even within a relatively limited scope of operation, their AI manged to hallucinate so thoroughly it disrupted normal operation!!
Several commentators said this was the plan all along. Before the IPO, many people speculated that the outrageously high valuation was designed so that current shareholders could sell of stock and make up for their losses in Twitter, etc. They predicted an early spike and a quick sell-off accompanied by a massive drop.
Where did that money come from? A lot of it came from public pensions (specifically index funds), which are required to hold a certain amount of all listed public stocks.
Makes me want to vomit. Fucking stealing from us all because the best we can hope to aspire to is a 401k and they just change the rules when it suits them, steal from us all, and because it was the general public defrauded they get a pat on the back and congratulations for “earning” more money, such good businessmen. Let’s elect more people to steal from us.
Index funds don’t update their investment balance instantly, in part specifically to avoid this kind of problem. Most major indices require a stock to trade publicly for a minimum period (often 3 to 6 months) before they’ll include them, and they rebalance on a fixed schedule - usually quarterly or semi-annually. A stock must wait for the next official rebalancing date to be added.
The things that might have been bit are Active Mutual Funds and Sector ETFs. These funds are focused much more tightly on specific sectors of the market and often buy “immediately” to ensure that they don’t miss out on up-and-comers. FOMO can bite these more easily. But for that very reason they’re not something that conservative investors like public pensions would invest heavily in, they’re explicitly meant for the more gamble-oriented stuff. If you explicitly take a risk with your money then you should expect to lose it sometimes.
No space X only had to wait 5 days to be added to broad market indexes, “roughly” 15 days for the nasdaq 100, “as little as one week” for the Russell 1000 and the S&P 500 has also waived the year waiting period for Space X so all the guard rails you’re talking about have been removed so this grift can happen.
The S&P Dow Jones Index Committee explicitly rejected proposals to fast-track SpaceX.
The Russel 1000 and NASDAQ 100 did have “fast-track” rules for large IPOs like this. However, they have an additional guardrail that I think you overlooked here. When SpaceX went public only about 4% of the company’s total shares were released to the public (the public “float”). The remaining 95%+ of the shares belonging to Elon Musk, early venture capitalists, and long-time employees are legally locked down and can’t be sold for 90 to 180 days after the IPO. Index funds are weighted based on free float (only the shares actively trading), the amount of stock the fast-tracking index funds are actually forced to buy right now is very small, representing a fraction of 1% of most portfolios.
So no, this really didn’t fleece 401ks and other conservative investment funds. They have rules in place specifically to prevent this sort of thing and outside forces can’t “force” them to break those rules. Musk and other early shareholders were unable to dump their stocks during that initial IPO price spike and pension funds weren’t buying the stocks up in significant quantities.
But the weight in those indices is still low, and it hasn’t entered the S&P 500 yet.
In the Nasdaq 100 index, it’s estimated to enter at 0.50–0.70%
https://www.hl.co.uk/news/what-does-the-spacex-ipo-mean-for-index-investors
Besides existing comments, this doesn’t make sense. If it were about the “outrageously high valuation”, it wouldn’t be about their stock dipping due to events after the IPO. You’re linking unrelated things.
Wait, you mean the worlds most corrupt billionaire was just…doing a pump and dump? Who could possible have seen this coming.
After the first time its whatever but now after like 30 pump and dump Musk is basically a warning “what’s the next scam?”.
It’s up 15% from the 160 market price the day it went live, even more for the $130 IPO that only billionaires and institutions could get. Wouldn’t exactly call that a “plunge” as most people who got in early are still way up.
musks poison pill of the stock makes it a nutty investment regardless of where it goes. I have a feeling though we are going to see similar things if musk gets away with it.
Literally every piece of news on the IPO was about how the valuation was way, way too high. Who the fuck didn’t see the drop coming?
I actually expect it to go higher than its earlier high, but then I would not be surprised to see it go much (much) lower than where it IPOed at.
Well, it hasn’t dropped below its initial valuation yet.
All of Musks enterprises have insane valuations without dropping too much / quickly. It is a bit unexpected. I would never actively invest in any of them though.
Shares of SpaceX declined by more than 6% to just under $179 as of Thursday afternoon
Morningstar analysts lowered its fair value estimate for SpaceX to $62 from $63
Plenty of room to fall.
SpaceX can only make enough money for that kind of valuation if it can get major returns from mining in space.
Honestly, what should happen is that it absorbs Tesla, then drops to about $10 share.
