No, neither Elon Musk nor his banks can easily get out of the deal to buy Twitter.

Yes, this is two issues in rapid succession. Maybe I should have held off on publishing that earlier issue a little longer. But hey, it’s the Irregular Bullshit. You were warned.


Twitter

It appears my assumption that the banks financing Elon Musk’s deal to buy Twitter can easily get out of that deal, thus undermining Musk’s ability to follow through,[1] was incorrect. Like Musk, they signed legally binding commitments.[2] Like Musk, though he seems not to give a damn,[3] they face reputational risks for reneging. And “[e]ven if they [the banks] do find a reason to get out of the deal — for example, by arguing Musk’s about-face has made the agreement significantly riskier for them — Musk could be forced by a judge to find another source of funding.”[4] Quoting at length:

The banks are only on the hook to fund the deal if it closes, and many people don’t believe Twitter will be successful in getting a court to force Musk’s hand. A more likely outcome is that the judge in Delaware Chancery Court, where the trial will take place, will force a compromise, making Musk pay Twitter a hefty fee for putting it through so much trouble, but letting him walk away in the end, said Carl Tobias, a law professor at the University of Richmond.

In that case, the banks will still get a small fee from Musk for doing the work and they no longer have to lend him anything.

There’s another reason they might be sticking with Musk for now — they want to stay in his good books, and arguing that he’s acting in bad faith might jeopardize that. Musk is still the world’s wealthiest man and will have a lot of need for debt financing in the future regardless of how the Twitter situation ends, Tobias said. “You want to keep his business if you’re a bank, because I think it’s pretty lucrative,” he said.[5]

And “Musk’s agreement with Twitter has a clause that requires him to go through with the deal even if his debt financing becomes unavailable.”[6]

Gerrit De Vynck, from whose report I quote so liberally in this update, doesn’t say how Musk might raise the money if so ordered. But based on past performance, Tesla might be in for a fall.[7]

Gerrit De Vynck, “Why Elon Musk can’t get out of Twitter deal even if his lenders bail,” Washington Post, July 15, 2022, https://www.washingtonpost.com/technology/2022/07/15/elon-musk-debt-financing-twitter/


Gilead

Abortion

Hardliner abortion opponents might welcome the opportunity to compel a ten-year old rape victim to carry the resulting pregnancy to term,[8] and some politicians, like the Indiana attorney general, might relish the political points they can score by threatening the doctor who, in the event, performed the abortion,[9] but those Republicans who count votes worry that all this won’t go over so well with swing voting suburban white women.[10]

Zachary Groz, “Out-of-state patients surge at Allegheny County abortion clinics as bans enacted elsewhere,” Pittsburgh Post-Gazette, July 13, 2022, https://www.post-gazette.com/news/health/2022/07/13/out-of-state-patients-surge-at-allegheny-county-abortion-clinics-supreme-court-dobbs-jackson/stories/202207120095

Megan Messerly and Adam Wren, “National Right to Life official: 10-year-old should have had baby,” Politico, July 14, 2022, https://www.politico.com/news/2022/07/14/anti-abotion-10-year-old-ohio-00045843

Alice Miranda Ollstein, “Indiana AG eyes criminal prosecution of 10-year-old rape victim’s abortion doc,” Politico, July 14, 2022, https://www.politico.com/news/2022/07/14/indiana-abortion-rape-ohio-00045899

Katie Shepherd, “Texas sues Biden administration for requiring abortions in medical emergencies,” Washington Post, July 14, 2022, https://www.washingtonpost.com/nation/2022/07/14/texas-sues-biden-emergency-abortion/

Matt Ford, “Why Aren’t Conservatives Celebrating the Post-Roe Future They Created?” New Republic, July 15, 2022, https://newrepublic.com/article/167055/post-roe-america-conservatives-future


  1. [1]David Benfell, “Elon Musk’s Achilles’ heel,” Not Housebroken, July 12, 2022, https://disunitedstates.org/2022/07/10/elon-musks-achilles-heel/
  2. [2]Gerrit De Vynck, “Why Elon Musk can’t get out of Twitter deal even if his lenders bail,” Washington Post, July 15, 2022, https://www.washingtonpost.com/technology/2022/07/15/elon-musk-debt-financing-twitter/
  3. [3]William D. Cohan, “The Musk Reckoning,” Puck News, July 10, 2022, https://puck.news/the-musk-reckoning/
  4. [4]Gerrit De Vynck, “Why Elon Musk can’t get out of Twitter deal even if his lenders bail,” Washington Post, July 15, 2022, https://www.washingtonpost.com/technology/2022/07/15/elon-musk-debt-financing-twitter/
  5. [5]Gerrit De Vynck, “Why Elon Musk can’t get out of Twitter deal even if his lenders bail,” Washington Post, July 15, 2022, https://www.washingtonpost.com/technology/2022/07/15/elon-musk-debt-financing-twitter/
  6. [6]Gerrit De Vynck, “Why Elon Musk can’t get out of Twitter deal even if his lenders bail,” Washington Post, July 15, 2022, https://www.washingtonpost.com/technology/2022/07/15/elon-musk-debt-financing-twitter/
  7. [7]William D. Cohan, “Elon’s Gamble: Imagining Tesla Stock Judgment Day,” Puck News, April 27, 2022, https://puck.news/elons-gamble-imagining-the-tesla-stock-judgment-day/
  8. [8]Megan Messerly and Adam Wren, “National Right to Life official: 10-year-old should have had baby,” Politico, July 14, 2022, https://www.politico.com/news/2022/07/14/anti-abotion-10-year-old-ohio-00045843
  9. [9]Alice Miranda Ollstein, “Indiana AG eyes criminal prosecution of 10-year-old rape victim’s abortion doc,” Politico, July 14, 2022, https://www.politico.com/news/2022/07/14/indiana-abortion-rape-ohio-00045899
  10. [10]Matt Ford, “Why Aren’t Conservatives Celebrating the Post-Roe Future They Created?” New Republic, July 15, 2022, https://newrepublic.com/article/167055/post-roe-america-conservatives-future

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