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Everyone me kevin here get ready for a massive price reduction request coming to the twitter deal personally i think the twitter deal is going to get cut by 31. That would bring. The twitter. Share price that is the deal price down.

From. 5420 5420 down to just 69 of that value to about 3740. That's my estimation. Why am.

I saying that well take a look at this article. Today from the washington post. The washington post. Says that this is a washington post exclusive that elon musk's deal to buy twitter is in peril.

And this is what i love three people familiar with the matter said well maybe those individuals. Her elon musk. His brother. And his attorney.

Who knows the point is these sorts of leaks are planned and i'm going to go through not only what the article said. But some other additional commentary as well because there are a lot of folks who like to say why doesn't elon just honor his deal he made a deal he should go through with his contract. What we're going to talk about exactly that so first. What does the article tell us tell us well.

It tells us that number one at the moment. Elon musk and the team have stopped engaging in discussions around financing. The 44 billion dollar deal you know this is important that elon musk has paused his fundraising beyond the 32 billion dollars. He's already said that he's raised here's why right now twitter's share price is selling for about 37 to 3750 that.

Means if you bought the. Twitter. Stock. Today at let's.

Say. 3750. Sense it would have to go up 45 percent to get to 5420. If the deal goes through that means you could potentially get a 45 gain.

If the deal goes through at full price. The stock market right now is telling you that's unlikely and by elon pausing additional funding. It implies that he's either going to walk away from the deal maybe he truly is pausing the deal or he's going to renegotiate and doesn't actually need more money given that he's already raised about 69 percent of the capital that he needs and twitter. Share price is selling for 31 below.

Where the deal was originally officiated. It's in my opinion. Very likely that elon musk is going to be asking for 31 price reduction. All the way to about 69 percent of the original deal value.

But we learned a little bit more. But i just want to make it clear that on a funding perspective and on what what the stock market is. Saying. Price wise both align.

With elon. Asking for somewhere between a 30 to 31 percent strike off of this deal. Or price reduction. Basically.

We also heard that quote talks with investors have cool. And that's because the firehouse or fire hose rather of information that twitter said they would give elon musk to verify spam bots has actually created more doubts for elon and elon's team and they've gone as far as saying that the information twitter has provided hasn't actually verified twitter's claim that only five percent of users are bots now elon musk did agree to a one billion dollar breakup fee that means if elon musk just decides to walk away from the deal he has to pay twitter one billion dollars. Which he's unlikely to want to do this is why i think rather than just walking away from the deal. Elon.

Musk is likely to pressure for a price reduction. That way he can draw out the negotiation and process. He's not walking away from the deal. So.

He's not giving up the one billion dollars. Yet instead he can buy time by renegotiating. A lower price now twitter might be motivated to say no now we're going to sue you for that one billion dollars. They're not going to get that one billion dollars automatically.

But that kind of lawsuit would leave a lot of overhang for twitter stock would probably create a lot of stress for the board and executive staff and create more distractions for the company and actually hurt the company by more than the tune of a billion dollars. Now is elon musk being dishonest for potentially wanting to ask for a price reduction. Here in my opinion. The answer to this is a hard no the reason for that is simple.

When you make a contract you make a contract under the belief. That both sides are providing honest information. However. If twitter.

Says bots are five percent maybe. A little bit more and the reality is that bots on the platform are actually 25 or 50 percent of the users on the platform. Then elon's been misled and this is only information that he could really discover through his business discovery within the actual deal now we know that earlier in the process elon musk quote waived due diligence in putting together the transaction but if red flags pop up that indicate that information that elon musk was originally basing his opinion on have now created a material change in the underlying value of the company. Then elon musk should be at least within his right to argue that he should not suffer a one billion dollar breakup fee and instead twitter should either give him his money back or lower the price.

My guess is based on where twitter is trading right now the market's telling us this deal is probably going to go through with about a 30 to 31 price drop to about 69 of the original deal volume or ordeal. Agreed price and this lines up with how much money. Elon musk. Has already raised and a 30 to 31 reduction.

Likely. Also represents the overstatement of users. That is if elon thought there were five percent bots and were really a 35. Bots.

That seems like it would be a fair compensation for that reality. Unless of course twitter wants to clean up their uh their statistics and the way they provide information but if they do that they might have to go back and change their sec disclosures and they end up in the same place. So again. I want to be clear here.

I personally think and i've said this since it. Started i think the arbitrage between the twitter share price today and 5420 is a mirage. I think it's a very risky investment and it's not one that i'm making i do own one twitter share because i was gifted that but beyond that this is not an arbitrage play that i want to make and i think elon's going to be dropping the bomb for a big negotiation and a price reduction of at least 30 percent. In fact he might even start with a price reduction of 50.

At least a request of 50. So that way there's more pressure on the stock price. And maybe twitter will meet him in the middle or he'll certainly end up getting 30 percent. That's my expectation.

We'll see let me know what you think in the comments down below. Now. I do also want to just address like hey is this me just trying to be negative about the twitter deal because i want to see tesla go up personally. I i think those are relatively disconnected.

So. And i've said this many times on the channel before like i hear a lot of people are like oh. Well you know if elon buys twitter. It's gonna be distracted.

I actually think the twitter deal would be positive for tesla. So i kind of hope the deal goes through because i think tesla is probably going to get easy licensing agreements for re. Really good language learning algorithms. Which elon musk would likely institute or create for not only fighting spam.

But also for moderating free speech and content. Which i think will be very very important to the future of robots and neural uh artificial intelligence essentially for uh for vocalization and for speech. I think those those are critical and so i think twitter is a great opportunity for that not necessarily wanting the world to be run by very sarcastic and trolley style. People that are robots.

But i think twitter will give some serious language learning opportunities especially since we could see sentiment change immediately in almost real time right for example we could get breaking news on a story and we can see how sentiment and emotions change. Over time and these are all huge learning opportunities. So you've got this combination of emotion and news on twitter. That really in a text based context.

You don't have in many other places you'd have to transcribe videos. Which is possible to do. But is more complicated than just using the text that people are writing right so. I don't know i'm fascinated by the twitter opportunities for language learning especially since hey 140 characters on twitter small file sizes can all fit on a little thumb drive.