The collapse of Silicon Valley Bank has sent investors running for the exits. But amid this crisis, opportunities could be opening up for Tesla CEO and Twitter owner Elon Musk.
Responding to a tweet that said, “Twitter should buy SVB and become a digital bank” on Friday, Musk tweeted: “I’m open to the idea.”
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The idea resonated with some Twitter users.
“What an opportunity,” wrote Twitter user Kevin Paffrath, who also runs the Meet Kevin financial YouTube channel with 1.86 million subscribers. “2-3 years to get a banking charter otherwise. Just make sure you go through those toxic assets with a fine-tooth comb!!”
Anyone who’s touching Silicon Valley Bank these days would probably want to be careful. The bank failed after depositors rushed to withdraw money last week, and the Federal Deposit Insurance Corporation quickly stepped in to seize the bank’s assets.
To be sure, while Musk tweeted that he's willing to consider a purchase of Silicon Valley Bank, no further information was provided.
Is Elon serious? Only Elon knows for sure. But you can still invest alongside the serial entrepreneur — here’s a look at how.
Tesla
Musk has created quite a few successful businesses. But he is best-known as the co-founder and CEO of EV maker Tesla (TSLA).
According to Bloomberg, Musk’s biggest asset at the moment is Tesla equity.
While Tesla stock is known for being volatile, it remains a behemoth in the automotive industry. With a market cap of around $540 billion, Tesla is several times bigger than Ford and General Motors combined.
And business is heading in the right direction.
In 2022, Tesla’s vehicle deliveries grew 40% year over year to $1.31 million. Meanwhile its production increased 47% year over year to 1.37 million.
Wall Street also sees upside in Tesla shares. For instance, Morgan Stanley analyst Adam Jonas has an ‘overweight’ rating on Tesla and a price target of $220 — roughly 27% above where the stock sits today.
Cryptocurrency
Once considered a niche asset, cryptocurrency has now entered the mainstream. A study from the CFA Institute in 2022 showed that 94% of state and government pension plans have invested in cryptocurrencies.
Of course, many investors learned about cryptocurrencies’ volatility the hard way through the massive pullback. For instance, bitcoin — the largest cryptocurrency in the world — is down 44% over the last 12 months.
Musk has been one of the more outspoken proponents of cryptocurrency.
“I still own & won’t sell my Bitcoin, Ethereum or Doge fwiw,” he said in a tweet earlier last year.
There are plenty of platforms that allow you to invest in crypto. Just be aware of fees: many exchanges charge up to 4% in commission fees just to buy and sell crypto. But some investment apps charge 0%.
Read more: Here are 3 easy alternatives to grow your hard-earned cash without the shaky stock market
Real estate
In the tweet where Musk shared his view on crypto, he also discussed the importance of owning “physical things” in an inflationary environment.
“As a general principle, for those looking for advice from this thread, it is generally better to own physical things like a home or stock in companies you think make good products, than dollars when inflation is high.”
Despite the Fed’s aggressive rate hikes, real estate remains a popular asset. The S&P CoreLogic Case-Shiller 20-City Composite Home Price NSA Index is up 4.7% over the past year.
As the price of raw materials and labor goes up, new properties are more expensive to build. And that drives up the price of existing real estate.
Well-chosen properties can provide more than just an inflation hedge. Investors also get to earn a steady stream of rental income.
But you don’t need to be a landlord to start investing in real estate. There are plenty of real estate investment trusts (REITs) as well as crowdfunding platforms that can get you started on becoming a real estate mogul.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
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