If anybody had any doubt that the SEC would put its regulatory interests ahead of holding a high-profile CEO accountable for a brazen violation of securities laws, rest assured - the agency's $40 million fine against Tesla CEO Elon Musk was little more than a slap on the wrist, appearing nearly identical to a settlement offer that Musk had rejected as recently as Thursday morning.

Of course, Musk was probably brought to the point of capitulation not by the SEC's threats (Musk knows as well as anybody that barring him from Tesla would likely cause billions of dollars of market value to vanish overnight) but by the most painful rout in Tesla shares in three years.

Musk

Unwilling to give the bears even a day to reassess, Musk had already set out over the weekend to repair the damage wrought by this most bizarre of corporate scandals (it memorably involved Musk's prolific twitter habit and an inside joke about marijuana). With his twitter use now constrained by the terms of the settlement, Musk instead likely "leaked" two unambiguously bullish emails to CNBC, in which he exhorted Tesla staff to go all-out on Sunday, the last day of the quarter, to achieve an important production benchmark for the Tesla Model 3. In the emails, he claimed that the company is "very close" to finally turning a profit after years of burning cash.

We are very close to achieving profitability and proving the naysayers wrong, but to be certain, we must execute really well tomorrow (Sunday).

If we go all out tomorrow, we will achieve an epic victory beyond all expectations.

Since Musk must now pre-clear any tweets with potentially market-moving implications, it appears that leaking bullish emails has become his new strategy of choice for "punching the shorts in the nose." And just as we expected, between the settlement news and the teaser ahead of Tesla's Q3 earnings report later this week, Tesla shares are up roughly 14% in premarket trading, portending an "epic" (to use Musk's own words) rebound in Tesla shares after the open.

These gains were egged on by sell-side analysts at Morgan Stanley, which said that Tesla’s fast settlement with the SEC "significantly reduces risk of spillover effects on capital markets, company morale and brand value."

In other words, Tesla bulls can breath a sigh of relief: The "Musk premium" will likely remain intact for the foreseeable future...