Tesla Revs Up Bond Buyers to Support Model 3

The video discusses a company's plan to sell $1.5 billion in bonds to fund its Model 3 electric car and improve its balance sheet. Despite being below investment grade and having no profit, the bond is in high demand, with interest rates expected to be under 5%. Investors are driven by a fear of missing out, despite the company's financial instability. The bond's covenants favor the company, allowing it to use its Giga factory as collateral, which poses risks to bondholders.

What is the purpose of Tesla's bond sale?

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How much of the bond had been sold within a few hours of its announcement?

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What is the significance of the interest rate being under 5% for Tesla's bonds?

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Why are investors willing to accept a lower yield for Tesla's bonds despite the company's financial situation?

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What are the covenants associated with Tesla's bond sale, and how do they affect investors?

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