General Discussion: 2018 Investor Roundtable

[Brando]

Yes.

This of course does not apply to anybody with a naked short. Naked short selling - Wikipedia

The simplistic way I understand it, a naked short hasn't borrowed the stock that they've sold. Therefore they don't have the collateral requirements.

They do have the 3 or 2 day settlement period in which they will need to square up the trade (borrow or buy the stock that they've sold), so I think that makes it a short term position. And of course, the trader entering into a naked short position will need a broker or market maker that will allow them to.


I don't know what happens on a Failure to Deliver - I assume that the broker / market maker has to deliver in lieu of the trader, and thus the broker / market maker is strongly incentivized to not allow any but the very largest of customers to ever have a failure to deliver.

This is when being part of the Federal Reserve Banking Cartel [especially the "investment banks like Goldman Sachs which all changed their charters from investment to commercial banks so they could get the Bush/Obama bail out money - many merged/bought up by larger commercial banks] cause who watches or audits their trading activity? Easy to do naked trades who will catch you? How would they find out? Can you delete your internal computer records to remove losses and only show your "profits"?

PS- It is true that there are NO investment banks in the US since September 2007. interesting, no?
They are now call "Full Service Investment Banks" - Glass-Steagall; Investment banks had different regulations from commercial banks, no more, everyone under Dodd-Frank, right?

side note: I guess they don't allow pension funds to short or do naked trades? would that be correct?

 

[adiggs]

This is when being part of the Federal Reserve Banking Cartel [especially the "investment banks like Goldman Sachs which all changed their charters from investment to commercial banks so they could get the Bush/Obama bail out money - many merged/bought up by larger commercial banks] cause who watches or audits their trading activity? Easy to do naked trades who will catch you? How would they find out? Can you delete your internal computer records to remove losses and only show your "profits"?

side note: I guess they don't allow pension funds to short or do naked trades? would that be correct?

I'm well outside of anything resembling an area of expertise, but its definitely an area of interest for me.

If nothing else, every trade has a built in audit because there's a second party.

If GS sells me shares and then fails to deliver, that means I don't get my shares. On the settlement date, my broker Fidelity would report a Failure to Deliver on the trade. In the ideal case, that means that the cash I used to buy the shares also hasn't left my account yet, so I get the cash credited back to my account. In this situation, ideal should also be "routine"

Or I suppose Fidelity could use their own cash to make me whole.

The primary point being that there isn't an epidemic of people buying stock with cash, and then losing the cash AND not receiving the stock.


So the "who will catch you" is reasonably evident to me - the rest of the market. But if the end result on settlement day was I got back my cash instead of the shares I bought, I'd be unhappy or not depending on how the share price moved, but I don't see that outcome turning into lawsuits or much in the way of media coverage. If there were an epidemic of it going on that included people losing their cash AND not receiving the stock, then there would be lawsuits and media coverage (at least some).

The Wikipedia article talks about "phantom" shares being created, that can't actually resolve back to a real share, but I didn't see links to something resembling evidence that it's a real thing.

Lots more here that I don't know than that I do

 

[avoigt]

Daimler Earnings Warning for 2018 "significant below previous year"

Daimler gibt Gewinnwarnung heraus

 

[abasile]

Sales tax revenue *is* lost.

First, you pay sales tax to California when you buy the car from California (or to NY when you buy it from NY).
Then, you pay sales tax to Texas or Connecticut when you register the car there, *but you get a deduction for the sales tax you paid to California or NY*.

In nearly all states, this is how it works. So Connecticut is losing revenue to NY and Texas is losing revenue to California.

I don't doubt that you're right about CT residents taking delivery of their cars in NY.

However, in the case of a Texan taking delivery of a new Tesla vehicle in Texas, I don't think that's how it works. Because the delivery is not actually occurring in California, no sales or use tax is paid to California. I believe it is then the responsibility of the customer to register the car as a Texas car and pay the taxes and fees that are owed to Texas.

This is sort of unfortunate, because it affords little financial incentive for Texas to allow Tesla to sell directly. Barring a US Supreme Court ruling, it might take some years before there's enough political pressure to change the law in Texas. Of course, this goes against the free market ideals that Texas purportedly stands for.

 

[Brando]

can.not.resist.must.restrain.self

"what melts in the ground and not your hand?" "Hershey, Pennsylvania" {and Baltimore, Washington DC and Norfolk, Virginia} (3 Mile Island)

"How do you make Chicken Kiev?" "Take 1, 900 pound mildly radioactive, 3 eyed chicken from Chernobyl"

small update - 12 minute update - what could go wrong? nuke waste will be a problem long after electrification - I know a little off topic - sadly it is important to US West Coast at a minimum.

 

[RobStark]

Frustrated GM investors ask what more CEO Barra can do | Reuters

"The Detroit carmaker's stock is down 22 percent since Barra took over in January 2014. After hitting an all-time high of $46.48 on Oct. 24, 2017, the shares have declined 33 percent. In the same period, the Standard & Poor's 500 index .SPX has climbed 7.8 percent."

Daimler CEO Zetsche stumbles on his victory lap

 

[Oil4AsphaultOnly]

I don't doubt that you're right about CT residents taking delivery of their cars in NY.

However, in the case of a Texan taking delivery of a new Tesla vehicle in Texas, I don't think that's how it works. Because the delivery is not actually occurring in California, no sales or use tax is paid to California. I believe it is then the responsibility of the customer to register the car as a Texas car and pay the taxes and fees that are owed to Texas.

This is sort of unfortunate, because it affords little financial incentive for Texas to allow Tesla to sell directly. Barring a US Supreme Court ruling, it might take some years before there's enough political pressure to change the law in Texas. Of course, this goes against the free market ideals that Texas purportedly stands for.

Yes about the taxes being paid directly to TX, but the customer gets more help now. See post #14: Deliveries to Texas (sales tax & other details...)

 

[Brando]

Friend avoided sales taxes (high in his home state) buying new car out of state and had temp job at national parks.The loophole was car was officially not new after 90 days, when he returned and then got home state plates. complicated; local laws vary and change.
What loopholes can you find?

 

[Brando]

Yes.

This of course does not apply to anybody with a naked short. Naked short selling - Wikipedia

The simplistic way I understand it, a naked short hasn't borrowed the stock that they've sold. Therefore they don't have the collateral requirements.

They do have the 3 or 2 day settlement period in which they will need to square up the trade (borrow or buy the stock that they've sold), so I think that makes it a short term position. And of course, the trader entering into a naked short position will need a broker or market maker that will allow them to.


I don't know what happens on a Failure to Deliver - I assume that the broker / market maker has to deliver in lieu of the trader, and thus the broker / market maker is strongly incentivized to not allow any but the very largest of customers to ever have a failure to deliver.

This clearly explains it all - read very very carefully - from above Wikipedia article. legal under certain circumstances

n 2008, the SEC banned what it called "abusive naked short selling"[2] in the United States, as well as some other jurisdictions, as a method of driving down share prices. Failing to deliver shares is legal under certain circumstances, and naked short selling is not per se illegal.[3][4][5] In the United States, naked short selling is covered by various SEC regulations which prohibit the practice.[6]

Perhaps being Goldman Sachs is a certain circumstance? Or just any Wall St. Bank?
Wall Street Bankster would never, ever do abusive naked short selling cause the SEC banned it, right?
I also know that phantom shares are so hard to find. Well because they are like phantoms.
Got to love THE Market. Invisible hand and all. Never makes a mistake and always fair.

good luck to all

 

[RobStark]

Porsche CEO downplays IPO, expects record sales

"Record pace

Porsche sold 196,562 vehicles during the first nine months of the year, with Europe showing a 9 percent increase and China, the world's largest car market, growing by 4 percent.

"In the light of these good numbers we expect that we can reach last year's record again," Blume said in e-mailed comments on Thursday.

The Volkswagen Group subsidiary delivered 246,375 vehicles in 2017."

 

[SPadival]

Any idea why @ValueAnalyst is banned?

 

[JRP3]

Trolling with the disagree button probably.

 

[Icer]

OT/Multilevel Nuked

Contribution to:
The ValueAnalyst 1st Memorial :Taking Things Personally & Reacting Badly Files


Television weather man
pointing while talking, as always:
"...This is the radioactive cloud from Chernobyl ...
coming our way.
heh, No problem!

But If it rains don't go outside.
Next up SPORTS!"

*
It rained
*
Radioactive rain
through the window

Later

For the first time the sound of the rain on the roof
caused him to lose sleep

*

A classic, true tale
From the Taking Things Personally & Reacting Badly Files
Vol 1

 

[Intl Professor]

In my view this is borderline gossip and speculation wrong at best. Stop this here.

 

[winfield100]

In my view this is borderline gossip and speculation wrong at best. Stop this here.

since folks keep talking Chernobyl and nuclear "accidents"
Chernobyl Appendix 1: Sequence of Events - World Nuclear Association

 

[neroden]

I'm well outside of anything resembling an area of expertise, but its definitely an area of interest for me.

If nothing else, every trade has a built in audit because there's a second party.

If GS sells me shares and then fails to deliver, that means I don't get my shares. On the settlement date, my broker Fidelity would report a Failure to Deliver on the trade. In the ideal case, that means that the cash I used to buy the shares also hasn't left my account yet, so I get the cash credited back to my account. In this situation, ideal should also be "routine"

Or I suppose Fidelity could use their own cash to make me whole.

The primary point being that there isn't an epidemic of people buying stock with cash, and then losing the cash AND not receiving the stock.


So the "who will catch you" is reasonably evident to me - the rest of the market. But if the end result on settlement day was I got back my cash instead of the shares I bought, I'd be unhappy or not depending on how the share price moved, but I don't see that outcome turning into lawsuits or much in the way of media coverage. If there were an epidemic of it going on that included people losing their cash AND not receiving the stock, then there would be lawsuits and media coverage (at least some).

The Wikipedia article talks about "phantom" shares being created, that can't actually resolve back to a real share, but I didn't see links to something resembling evidence that it's a real thing.

Lots more here that I don't know than that I do

So, first thing to understand: *this is what clearinghouses and exchanges are for*.

Your trade is usually made with a broker. The broker, on your behalf, trades with the *exchange*. The exchange matches you up to someone on the other side of the trade (whether a market maker, or another broker acting on behalf of another client).

The *exchange* has contractual obligations to make you, and your broker, whole. So if you buy shares and the other client "fails to deliver", the *exchange* buys the shares (probably from a market maker) and gives them to you. The exchange does not have the option of defaulting; they're legally on the hook. Your broker can demand the shares from the exchange -- even in certificate form if you demand it. I believe the exchange is civilly and criminally liable if they don't deliver them on demand.

The exchange then goes after the broker or market maker on the the other side of the trade who failed to deliver. That broker or market maker has a very strong incentive to pony up the shares, because the exchange will throw them off the exchange and ban them from trading if they don't do so. But the exchange will often given them excessive time to deliver, because these are their buddies and they *usually* aren't facing masses of customers demanding that certificates be issued in their name as stockholders of record. This is where the shenanigans can start coming into play. You can end up with a market maker or broker owing shares to the exchange and not having them. In the worst case, a true short squeeze where there are no shares for sale at any price, the market maker or broker who is in a naked short position will default -- have their remaining assets seized by the exchange in compensation -- and potentially be thrown in prison.

Obviously they don't let themselves get this exposed, at least not for the last several decades... usually whoever's unable to deliver will end up buying shares off someone else (who may also fail to deliver) which can lead to a merry-go-round of delivery failures, but leave the "legitimate purchasers" with shares and leave the naked short-sellers going after each other for shares while the exchange breathes down their necks.

 

[larmor]

Total speculation: recent facetious tweet by EM about buying fortnite, worth $8B followed up youtube video of digital chart/pie graphs... Is this a telegraphed message of upcoming revenue/profits...

 

[brian45011]

Texas is losing revenue to California.

Very little. Texas collects and retains 6.25% vehicle sales tax on nearly every Tesla sold to a Texas resident. The exception is when a Texas resident travels to California to take possession of the vehicle and pays California's 7.5% vehicle sales tax and other fees. Under those circumstances the credit applies, but only up to the 6.25%. Texas buyers who take possession in California pay an extra 1.25% (plus miscellaneous fees) that buyers who have their vehicle delivered to a Texas Service Center (or their residence) do not.

 

[Brando]

Can both camps - FOR and AGAINST Tesla - at least agree on this one video??
@winfield100 - surely you can come up with an appropriate literary/philosophical/historical quote?

 

[winfield100]

Can both camps - FOR and AGAINST Tesla - at least agree on this one video??
@winfield100 - surely you can come up with an appropriate literary/philosophical/historical quote?

good golly miss molly, um give it a try
"...questions such as 'What is the meaning of life?' are themselves meaningless. The question implies - indeed an answer to it would demand - a moral framework beyond the only moral framework we can comprehend without resorting to superstition (and thus abandoning the moral framework informing - and symbiotic with - language itself)"
A Few Notes on the Culture, by Iain M Banks
(basically, just read the ~10 Culture books by writer Iain M Banks,
or
(more or less)
"Do not be like that most ungracious preacher, who whilst showing me the steep and rocky path to heaven, himself the primrose path of dalliance treads"
(should i change my handle to "buddy jesus")(amusement ensues)