By any measure, Elon Musk is a powerful chief executive. But that power could be put to the test by what may be his tenuous financial position.

In a wide-ranging reportThe Wall Street Journal says that despite the fact that Musk is worth billions of dollars on paper, he's been surprisingly "illiquid." And his use of Tesla stock to support his loans could put the company at risk.

According to the Journal, Musk owns approximately $28 billion in Tesla stock, giving him about 20 percent ownership in the company. But to fund his lifestyle, Musk needs cash. And to get that cash, he's turned to loans, granted to him because he uses his Tesla stock as collateral.

Of course, discussing someone's personal finances is generally off limits, but Musk is in a decidedly different position because his personal finances may have a direct impact on Tesla itself. In fact, Tesla even puts in its regulatory filings that Musk's debt burden could hurt the company.

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"If the price of our common stock were to decline substantially and Mr. Musk were unable to avoid a sale of the pledged shares (for example, by contributing additional collateral or reducing his leverage), Mr. Musk may be forced by one or more of the banking institutions to sell shares of Tesla common stock under the terms of his loans," Tesla wrote in a recent regulatory filing. "Any such sales could cause the price of our common stock to decline."

The problem, according to data obtained by the Journal, is the banks have the right to call loans if Tesla's stock price falls below a certain level, because the collateral--the company's stock--would be worth less. Musk, who's on the hook for those loans, would then need to pay up. The problem is, he may not have the cash to pay up, requiring him to use stock. Such a sell-off could send the company's shares plummeting more quickly than even an errant tweet.

It's such a concern for Tesla that the company has even instituted a policy that limits how much stock he can use for personal loan collateral, according to the Journal.

But there's another problem.

Musk needs to hold on to those shares for control over Tesla. Unlike other companies, like Facebook, which allow for Mark Zuckerberg to maintain voting control over the social network regardless of his ownership in common shares, Musk is just like every other shareholder. If he's forced to sell his stock, he loses control--something that could put him and his job at risk.

So, what is Musk left to do? Get more shares. That's probably why his executive compensation package awards him stock instead of cash. The more stock he gets, the more he can liquidate without affecting his control. It could also help him reduce his reliance on loans.

Just how bad is Musk's cash position? It's impossible to say. But the Tesla chief, who's selling both of his homes in California, has said before that his "cash position is very limited." When he was getting a divorce several years ago, he said he "ran out of cash entirely," according to court documents.

Like most things Musk does, there's a lesson to be learned here for other business owners. For one, consider stock options, stock classes, and maintaining control. Second, remember: for all-things-business, cash is still king. And while debt has its place, it can be dangerous, even for billionaires.

For his part, Musk seems less concerned publicly. In a tweet last week, Musk said he's not selling his homes for cash."Devoting myself to Mars and Earth," he tweeted. "Possessions just weigh you down."