TSLA Market Action: 2018 Investor Roundtable

[Fact Checking]

(To be fair, my understanding is that the Japanese cultural attitudes towards those who smoke marijuana, on a scale of 1 to 10, where 1 is Jeff Sessions, and 10 is Willie Nelson, are... probably a 1.)

Then I'm quite sure they are glad that Elon didn't inhale and explained that he doesn't use weed because it's bad for productivity!

But yeah, short FUD has been trying to push a wedge between Panasonic and Tesla for years, because it's a very productive partnership, but what matters most is that both Panasonic and Tesla are going to earn a boatload of money from the Gigafactory cell production lines that are now expanding from a 20 GWh annual capacity to 35 GWh capacity.

 

[landis]

Please pay attention also to war between medias. All medias are fighting for their market share. And when one of most famous CEO use Twitter for important info, there is a red alert in the legacy media supported by legacy industries. Means less $ for them.

Another important angle I've not seen here yet...

Isn't the SEC also fighting for relevance of Wall Street? Serious question.

If Elon had taken TSLA private, that would have added 'big money' to the list of disrupted industries. So action necessary to discourage copycats by raising barriers.


BTW
Those of us a bit shy of accredited investor status will be forever indebted to Elon for allowing us to participate in the mission albeit in slightly less efficient manner than might have been possible.

A teeney bit of me wishes I had bailed out right away (near recent high) because I would certainly be back in now. Been in this rodeo/roller coaster for maybe a dozen cyles. I guess I am a slow learner since FOMO has mostly kept me from profiting from trading a small fraction on the waves.
If discount still available in mid November I may need to consider increasing position.

 

[Fact Checking]

A teeney bit of me wishes I had bailed out right away (near recent high) because I would certainly be back in now.

While this sucks in the short run, the problem with selling at a top is that you'd then blame yourself for the rest of your life if that 'top' had just been the floor of the next big break-out and shift in valuation models ...

IIRC there was a member commenting here who in 2013 correctly saw through the short FUD, predicted the short squeeze, bought at $30 in early 2013, happily sold at $45 with a nice +50% profit at the top of short squeeze ... only to see the short squeeze pushing the price to $190 in a few more months and the stock never again dropping below ~$120 after that. That experience must have left a mark.

While arguably market cap was much lower in 2013 which magnified the short squeeze once a much larger pool of investors was unlocked, if Tesla delivers and becomes the next trillion dollar U.S. company then that's a per share valuation of $5,800 ... and my own long term valuation of Tesla is even higher, which valuation I won't mention because it would make even @TrendTrader007 blush.

In that context and on that time scale a draw-down from $380 to $260 is peanuts. (Assuming you can spare the money, can stomach the draw-down, and it also assumes that Tesla delivers and the high long term valuation materializes too, of course.)

 

[Jayjs20]

Did you sell? Or just down on paper?

I don't sell into weakness. Both bulls and bears can make money on the stock market. They do so by taking from people who trade on emotion.

 

[bhtooefr]

Then I'm quite sure they are glad that Elon didn't inhale and explained that he doesn't use weed because it's bad for productivity!

There's a reason I used scare-quotes in my post.

(And if the exec in question actually listened to that... I mean, Japan is the country where methamphetamines were developed, so they're better aligned with Musk than they think, I suspect.)

But yeah, short FUD has been trying to push a wedge between Panasonic and Tesla for years, because it's a very productive partnership, but what matters most is that both Panasonic and Tesla are going to earn a boatload of money from the Gigafactory cell production lines that are now expanding from a 20 GWh annual capacity to 35 GWh capacity.

And, of course, Panasonic's accelerated their Gigafactory 1 expansion in response to Model 3 demand, as has been previously reported. And, Tesla can absorb any cells that don't go into Model 3 by putting them into Powerwalls and Powerpacks.

 

[cheshire cat]

Panasonic uneasy about partner Elon Musk's bombshells

There's the usual FUD, although it's interesting that they have a source claiming that Panasonic is getting leery of working with Musk, over things like the going private tweet and his "use" of marijuana on Joe Rogan's podcast.

(To be fair, my understanding is that the Japanese cultural attitudes towards those who smoke marijuana, on a scale of 1 to 10, where 1 is Jeff Sessions, and 10 is Willie Nelson, are... probably a 1.)

Indeed but I'm not sure the Japanese economy can afford (cultural differences) to be too picky about it's partners, notwithstanding the likely impact of Tesla on it's homegrown auto industry

 

[dqd88]

While arguably market cap was much lower in 2013 which magnified the short squeeze once a much larger pool of investors was unlocked, if Tesla delivers and becomes the next trillion dollar U.S. company then that's a per share valuation of $5,800 ... and my own long term valuation of Tesla is even higher, which valuation I won't mention because it would make even @TrendTrader007 blush.

I think $1T market cap around 2030 is feasible. What's your timing?
The scale up will not be hocky stick like though like a software company. I think it will be a bit more steady as the revenue is constrained by capacity which is a slow build out. I'm really curious to hear more about the timing of the new gigafactories. Need more info!

 

[avoigt]

I posted this earlier where the former SEC senior counsel pretty much saying SEC will most likely lose this case, Elon's tweet being "more than defensible".

This is something.

The most clear and profound analysis from a former SEC member dismantling the fundamental question the SEC does raise in the allegations in very simple and clear words in a few minutes. I love that guy. Hope the judge listens in.

He brought it down to the point that the SEC in essence claims he lied in the tweet but first of all he had conversations with investors like the Saudis and secondly he has a track record of managing funding therefore Elon did not lie and may have had even the impression its secured. All other allegations are coming back to that point.

In the beginning of the tweet he uses the term "considering" which is relevant for the entire tweet. If you consider to take a company private you make this clear to the investors that the "taking private" is not at all secured but more a "I start investigating this" statement .

The funding part may or may not have been secured at that point in time but for the investor it does not matter because he knows that the "taking private" part which would effect him is not a done deal and therefore the case if funding is secured does not matter and is not a done deal either in a decision to invest or not. It would have mattered if he would have written "I take Tesla private. Funding secured". But he did not!

Given that, all money an investor potentially lost is because he thought the tweet said something it did not. IOW there is just a damage done because that investor was unable to understand the tweet properly and did a bad investment decision.

Anybody who did an investment because he thought funding secured means the take private part is secured fooled himself by nor reading the message thoroughly.

The entire confusion of the media, investors and the SEC is because people have a hard time to read and understand the meaning of this two sentences.

I don't know how the SEC can even believe they will win this. All the allegations they bring up are without substance once its clear that the tweet just indicated his intention and if or if not the funding is secured in that respect is irrelevant for an investors decision. If people interpreted it like because funding is secured the taking private is secured the put something in the words that is simply not there.

Language is tricky and people tend to read messages in words that are just not in there. The "secured" at the end of the tweet kind of gives them the impression its also a word in the first part of the tweet but its not. Look again!

Kind of a joke me as a German saying all of that....

 

[bhtooefr]

I don't know how the SEC can even believe they will win this.

You assume that they're trying to win the court case, and not something else entirely.

Remember, Preston Tucker won his court case against the SEC.

 

[cheshire cat]

A long way between speaking " english " (and it's variants). and the comprehension thereof . I guess that is why "click bait" is so successfull, so much to read and so little time

 

[Fact Checking]

The scale up will not be hocky stick like though like a software company. I think it will be a bit more steady as the revenue is constrained by capacity which is a slow build out.

There's a couple of Tesla growth wildcards that I can see:

• Once Tesla moves past the growing pains, when exactly is the first big ICE automotive player going to declare bankruptcy?
• If Tesla is going to be with the strongest free capital position by that time then they'll be able to buy out those factories, hire the workers before skills erode, and speed up the EV transition and growth.
• So IMO it's a race against the clock: can Tesla grow fast enough in the next 2-3 years before the ICE dominoes start falling? Or will the ICE industry be able to perform an amazing turnaround?
  
• Other than that, the EV transition will IMO still happen much faster than the construction time of the first Gigafactory suggests, as building more Gigafactories literally only requires capital and work at this point, there's very few R&D vagaries left.
• If Tesla's Shanghai Gigafactory works out as planned, and if a Gigafactory indeed only takes 2 years to start generating cash then growth should be exponential with a rough doubling of production capacity every 2 years in the most aggressive scenario (and ~40% YoY revenue growth) - and production growth probably still won't be able to keep up with growing EV demand.

Overall I believe there's a significant chance, if the ICE industry continues to make unforced errors, that the EV transition is going to be the most disruptive and most immediate step in the Fourth Industrial Revolution of humanity.

But, please keep in mind that these are all pie-in-the-sky possibilities at the moment, there's still a lot of front-loaded uncertainties and risk factors IMO: Tesla needs to execute, execute and execute, and Elon also needs to win a lawsuit.

 

[svp6]

Picked up my performance 3 yesterday from Minneapolis - 4 model 3s delivered at same time at 7:30 PM. Chaotic atmosphere, but only happy faces around. They were talking of ~1000 deliveries this week, 150 Saturday alone.

As other said, thank you for the opportunity to buy some more stock. I bet next week after Tesla announces quarterly sales we will be back at ~320. Easiest money to make.....

 

[Lessmog]

I’m with you on this one. The SEC will definitely get backlash from this. They should have thought this one through before trying to take down a person like Musk. Sure the guy is controversial, but he’s no villain. He’s got a massive following and fans around the world adore him. He single handidly created 40,000 jobs in Tesla alone...We can all sit here and criticize the guy, but think of it this way, if we faced the same amount of pressure will we cave or will we continue the good fight? Will we make the right decisions along the way? How many times in past have we put our careers/livelihood at risk fighting for what we believe was right, just and honorable? For me it’s very few and far in between, I’ll stand up for what I believe, but in the face of imminent threat, I’ll know when to back down and save my own @ss. Having a guy like Musk, who doesn’t back down, might just be the right ingredient we need to fight those bullies.

Musk isn’t perfect, but my continued support isn’t just bc I’m a Tesla owner, but it’s also because I need someone to stand up to the establishment because I’m not brave enough to do it, nor do I have the funds/ability/resources... Musk is my guy.

I also agree. BUT ya gotta give the SEC some leeway here, being handicapped as they are both by limited gifts from birth and by an isolated life on an overcrowded island in Noo Yuck, under constant pressure from The Swamp. Face it, those guys aren't as SMRT as they tell each other every day. The quality of some of those lawyers is deplorable. Adjust expectations accordingly.

/end sarcasm/

 

[avoigt]

You assume that they're trying to win the court case, and not something else entirely.

Remember, Preston Tucker won his court case against the SEC.

Your indicating they are tying to win the public opinion despite loosing the case?

Well, right now the public opinion in my view is already against Tesla. Just look at Prawdu from Clean Technica or talk to anybody on the street. There is nothing really that the SEC can win on top. The strong and educated bulls like us here will not move because the SEC makes a claim or opens an allegation.

As far as I understand the Tucker case , remembering the movie, they finally went bankrupt mainly because they had no funding to pay suppliers despite many customers waiting. So Tesla does not need any funding any more other than consumers buying their cars. I don't see that demand decreasing but only increasing. For that reason the Tucker case does not apply to Tesla.

 

[Zaxxon]

But Lutz, jeeze, a total stream of BS. One clear example of his FUD is he says that other automakers produce a car, send it to a dealer who then have 60 days to pay On the other hand, Tesla who don't have dealers, need to wait until the car is paid for the customer. Which in principle is correct, but as they're built to order, I would imagine the time to payment is a lot less than 60 days, at least in the US.

I assisted with owner orientations yesterday. All cars I assisted with were built 9/18.

Musk has hired Stephen Best at Brown Rudnick, who successfully defended internet billionaire Mark Cuban in an insider trading case, according to people familiar with the plans who also asked not to be identified. He also hired former Assistant U.S. Attorney Chris Clark of Latham & Watkins to defend him in the case, the people said.

Point of clarification: Clark was also on Cuban's defense team.

 

[Lessmog]

Meh, too. May I join your movement?

Hehe, that was really witty.

 

[gora321]

If you try imagine for a moment what would be USA without Tesla? The land of opportunity without opportunity?
What would look like USA car industry, comparing to Europe, Japan, CHINA?
I don't see any advantage compering China without Tesla. Actually I see only dinosaurus in USA.

China has a big local pollution problem and doing a lot of progress to solve that. They are forced. We are lucky that solving local pollution helps whole planet too. They have no choice and this is the reason for biggest EV market.
Im sure when China will solve local industry they will come fully competitive in the global market. Huawei, Xiaomi...are nice samples already. What is USA strategically doing about that? Building walls? Compromised SEC attacking one of the best people that USA has who can compete globally because of some shorters (their view is short) want some B$ no matter what? What is few B$ comparing to world leadership in some area? If USA manage to build the wall and kill all the progres to assure no change, do you think the rest of the world will do the same? Nope. The isolation will be same as you have today in NKorea with similar results.
I just do not get the Wall Street. Are they really so stupid wanting kill all the progress that Elon has done? How much will this help WS to remain financial lider? Elon once said that financial people are very stupid. I believe him.

Looks like that WS knows nothing how innovations work. If they knew they should support one of the best man because WS has a problem with remaining of financial lider. Btw: Europe is building separate financial system (independent of $) and others are doing same. Somebody should shake those idiots because world needs competitive, open USA. Compromised SEC activity is very clear symptom of stupidity acting in the short term.

I just hope that USA will find the man with a vision. Maybe we shouldn't looking any more.

 

[Fact Checking]

I also agree. BUT ya gotta give the SEC some leeway here,

Sorry, but in this central paragraph of the SEC lawyers' filing they are uncritically regurgitating short seller talking points and are whitewashing and obscuring the fact that short sellers, by definition, are profiting at the expense of Tesla shareholders:

"15. In 2018, stock analysts and investors increasingly began to question whether Tesla could meet its previously announced production targets and begin to earn sufficient cash in order to sustain its operations and pay its existing debt load. By August 2018, more than $13 billion worth of Tesla shares were being “shorted,” meaning they were sold by investors who did not own them at the time of the sale. Investors who sell stock short typically believe the price of the stock will fall and hope to buy the stock at the lower price to cover their short positions and earn a profit. If the price of the stock rises, short sellers who then exit their short positions by purchasing the stock at the higher price will incur losses."

https://cdn.pacermonitor.com/pdfser..._Exchange_v_Musk__nysdce-18-08865__0001.0.pdf​

This attempt to protect short selling anti-investors goes against the primary purpose, role and mission of the SEC to protect investors.

This sick legal attack against one of the most innovative U.S. companies needs to become a permanent blemish on their record, a career limiting choice. After Elon's lawyers are finished with them their legal careers should be left vaporized in a molten crater, as a warning sign for future would-be attackers, glowing in the dark for centuries.

I'm not willing to cut the SEC any slack here, this lawsuit against Elon Musk is beyond reckless, it's a mockery of justice.

 

[dondy]

Panasonic uneasy about partner Elon Musk's bombshells

There's the usual FUD, although it's interesting that they have a source claiming that Panasonic is getting leery of working with Musk, over things like the going private tweet and his "use" of marijuana on Joe Rogan's podcast.

(To be fair, my understanding is that the Japanese cultural attitudes towards those who smoke marijuana, on a scale of 1 to 10, where 1 is Jeff Sessions, and 10 is Willie Nelson, are... probably a 1.)

lol since when the japanese care about what their partners do outside of business meetings? The only negative thing would be to drink more alcohol then them and remain "sober", everything else is irrelevant really. The japanese go into such sh1tholes even the english and dutch are too shy to enter....
What this article is saying that Panasonic is investing in Musk and if he will go they will too. Which is to be expected.

 

[HG Wells]

I assisted with owner orientations yesterday. All cars I assisted with were built 9/18.

The above statement is VERY IMPORTANT.
This means the cars was built only 10 days before SALE.

This destroys the only FUD I have given the slightest credence to.