2017 Investor Roundtable:General Discussion

[Papafox]

Cancelling the 60 now means they're very confident M3 won't be delayed.

Cancelling the Model S 60 creates an "order now or lose this opportunity" scenario for those considering a new Model S but don't need the extra range. You will see an increase in Model S 60 orders as the April 17 deadline nears. It will be similar to the pre-announced disappearance of free supercharging. Tesla knows how to manage catalysts

 

[mmd]

Odd how you left out the other side of the story.
Sounds as if she still works there.
Female engineer sues Tesla, describing a culture of 'pervasive harassment'
So not only can you point out issues at Tesla, you can file complaints against the company and still get promoted. This is not to say that I think she made everything up and may not have valid complaints.

Nice try, but you picked the wrong article, despite me saying in the post that it was brought up by @Cosmacelf. I was slightly incorrect, but it won't have been hard for anyone to find it out.There is a feature in the site, to look up people's posts. Next time try using that instead of creating your own strawman. Below are the two posts, with article link. You can find that engineer on linked in; so it is not "fake" news.

It's weird, a "negative" article on Elon on the New Yorker.
Elon Musk Has Delivery Issues

Yes, very negative article. I tried to find more information about the engineer that was "forced to resign", but didn't find any more information than what was in the article. Anyone know more about that incident? From the WSJ article: "In early 2014, she saw cars lined up for assembly with flawed headliners, a part of the roof’s interior. She said the flaw left a gap between the headliner and the trim on the roof-support pillar through which the car’s metal frame was visible."

Anyone remember whether there was an issue with that in Model S in early 2014? That would have been the second real/full year of production for the Model S.

Exactly!

Maybe @mmd can point to me a company without HR issues that isn't one employee company. Even at a two employee company you will have HR problems. Reread and Think about that again.

Good job with your strawman argument! I never said, there is such a company. If you bothered reading my post, I said the exact opposite. Iwas only refuting @JRP3's claim, that good engineers alone can overturn/control the decisions made by top management based on ground realities. Next time, trying attacking the original argument.

If they're cancelling the 60 then combined with falling battery cost MS margins are going well over 30%.

I guess, people were getting the S75 at the S60 price anyway. With the recent price increase of MS60 to $68k, it became even less appealing. What's old is new, and new is old again. MS 60 comes, goes, comes back, changes prices, goes. Random changes go on and on. What exactly is the motivation here?

 

[larmor]

Okay. I'm sure someone is going to yell at me for mentioning Trump, but I think this is an important observation that should be discussed. Has anyone else noticed that any time the market appears weak, there is any news that Trump wants people to think is incredible even if it's not particularly significant, or there are things Trump doesn't want the media to talk about, Trump is active on Twitter?

It's almost like he uses crazy Tweets to control the news cycle because his Tweets are easier to write about then legitimate problems or boring/complicated sounding things the general public isn't likely to want to read and discuss.

Even Fox News sort of agrees.

Related: Who ever thought that TWTR didn't have value? Now they have some very well documented verified users, and is a source for 'news' and public policy....

 

[geneclean55]

Over on the delivery threads, I am seeing MX deliveries being pulled forward by a week or so into Q1 . These are east coast deliveries as well, which doesnt agree with predictions based on the recent factory shut-down.

 

[dakh]

If they're cancelling the 60 then combined with falling battery cost MS margins are going well over 30%.

This probably also means they got enough Model S orders they don't feel like they need the expansion of the targeted market that they got by offering the 60.

 

[racer26]

Over on the delivery threads, I am seeing MX deliveries being pulled forward by a week or so into Q1 . These are east coast deliveries as well, which doesnt agree with predictions based on the recent factory shut-down.

Perhaps running 3-shifted (presumably since the shutdown) got up to speed faster than initially anticipated?

 

[drinkerofkoolaid]

Related: Who ever thought that TWTR didn't have value? Now they have some very well documented verified users, and is a source for 'news' and public policy....

If the world exists in 20 years, people will look back at 2017 as the year Twitter became the platform used by government leaders to address the public, rather then long and technical legal sounding press releases full of substance and facts.

Twitter will be a credible way for government leaders to communicate with the public once Twitter figures out a way to eliminate sock puppets, paid trolls, and bots (of which there are a lot).

 

[geneclean55]

Perhaps running 3-shifted (presumably since the shutdown) got up to speed faster than initially anticipated?

I hope so

 

[Xorbit]

With a little thought you could add finance to this.

Yes, absolutely. I'm a big proponent of and investor in bitcoin and MaidSafe coin.

As you move to zero marginal cost throughout much of the economy, this leaves fixed costs the main cost driver.

Good point. neroden mentioned earlier (if I understood) that he mainly invests in companies with high fixed costs. A Buffett moat?

So all this stuff that tends toward zero marginal costs increasingly exposes the economy to interest rates.

Yes. If you have the time and/or interest, I recommend this paper on the global savings glut by the Chief Investment Officer (equities) at Fidelity. If he's right, then interest rates/the cost of capital will remain low for the foreseeable future:
http://www.fidelity.com.au/insights-centre/investment-articles/the-global-savings-glut/
The global savings glut - Fidelity

"Global gross savings are about 24% of global GDP and, when adjusted for depreciation of fixed capital (savings wealth consists of fixed assets as well as financial capital), we are still seeing savings of 11% to 12% on a net basis, which is substantively in excess of nominal economic growth."

I'm definitely in this camp. Financial bubbles happen when we get a combination of cheap capital and innovative technology. The internet hype created the last great equity bubble. I think a whole host of new technologies (AI, VR, gene sequencing, renewable energy, autonomous/electric vehicles, 3-D printing, p2p finance etc) will capture the investor imagination and fuel the next. I also think it will dwarf the internet bubble - just look at how overvalued bonds got 2 years ago when interest rates went negative.

 

[Crowded Mind]

Yes, absolutely. I'm a big proponent of and investor in bitcoin and MaidSafe coin.

Good point. neroden mentioned earlier (if I understood) that he mainly invests in companies with high fixed costs. A Buffett moat?

Yes. If you have the time and/or interest, I recommend this paper on the global savings glut by the Chief Investment Officer (equities) at Fidelity. If he's right, then interest rates/the cost of capital will remain low for the foreseeable future:
The global savings glut - Fidelity

"Global gross savings are about 24% of global GDP and, when adjusted for depreciation of fixed capital (savings wealth consists of fixed assets as well as financial capital), we are still seeing savings of 11% to 12% on a net basis, which is substantively in excess of nominal economic growth."

I'm definitely in this camp. Financial bubbles happen when we get a combination of cheap capital and innovative technology. The internet hype created the last great equity bubble. I think a whole host of new technologies (AI, VR, gene sequencing, renewable energy, autonomous/electric vehicles, 3-D printing, p2p finance etc) will capture the investor imagination and fuel the next. I also think it will dwarf the internet bubble - just look at how overvalued bonds got 2 years ago when interest rates went negative.

Very interesting discussion. Perhaps warrants a thread? I would be curious to hear people's thoughts on Ethereum as well.

 

[JRP3]

Nice try, but you picked the wrong article, despite me saying in the post that it was brought up by @Cosmacelf. I was slightly incorrect, but it won't have been hard for anyone to find it out.There is a feature in the site, to look up people's posts. Next time try using that instead of creating your own strawman.

Or next time you could just use quotes and correct links, as I did, so there is no confusion. In any case my quotes and links still provided evidence of employees being able to speak out, contrary to your implications.

 

[luvb2b]

i don't know, but i can't imagine it's more than $4.95. i think the reality is they just didn't get very many shares.

separately, i have the convertible bond terms (maybe someone already posted). 2 3/8 coupon with a 327.50 conversion.

my estimate is that it costs tesla around 6% to borrow money for 5 years and the embedded option value is around $150 per $1000 of face value of the bond. the 6% cost comes down to 2 3/8% due to the conversion feature.

What's Fidelity's commission on the 25 vs 5000 shares? Would it be to Fidelity's benefit if shares were sold to more customers vs less with greater lots?

 

[drinkerofkoolaid]

For what it's worth, Bollinger bands are basically a form of standard deviations. The longer Volatility remains subdued, the more bizarre volatility will get when it returns.

Maybe this is some bizarre form for contango caused by bets that Trump wouldn't win the Election? Maybe a lot of options writers went bust when the market fell after the election, only to rebound and continue to rally for 3-4 months?

Or maybe this is being caused by Trump telling Goldman Sachs to do X, and since the GOP has no desire to enforce SEC regulations (because they are regulations), no-one is speaking up?

Either way, the market can't go up forever, and when it corrects, there is very little resistance below current levels.

Also, why is the debt ceiling being ignored? The US treasury will run out of money in the near future unless some extraordinary measures kick in that no-one is taking about, that will only work for a few months.

I'm not bearish on Tesla, but Tesla is part of the broad market and the broad market is wildly overbought. I was along shares I purchased a long time ago that I sold ~$280. I am currently long Tesla via options I bought when stock was ~$240, but am a bit concerned how Tesla will act if something causes volatility to spike. Maybe this is another reason Tesla did the offering now?

 

[RobStark]

Weekend O.T.

Clarity fills up in California for $80 for 366 miles of range. Or 21.9 cents per mile.
Honda hiding the price of the car and fuel in an all inclusive subsidized lease.

 

[Ulmo]

Also, why is the debt ceiling being ignored? The US treasury will run out of money in the near future

God I hope so. We need to stop growing our government. The less it spends the better. (The government doesn't like letting itself be demolished, so I know the likelyhood of this, but if it is a secret GOP plot to actually shut it down for 6 months a year, that would be awesome!)

I'm not bearish on Tesla, but Tesla is part of the broad market and the broad market is wildly overbought. I was along shares I purchased a long time ago that I sold ~$280. I am currently long Tesla via options I bought when stock was ~$240, but am a bit concerned how Tesla will act if something causes volatility to spike. Maybe this is another reason Tesla did the offering now?

I seem to agree. (There is a bit of hindsight bias that I think I don't have but probably do, thus the "seem".)

 

[dirtyofries]

8-K posted

Tesla - Current Report

 

[Ulmo]

Weekend O.T.

Clarity fills up in California for $80 for 366 miles of range. Or 21.9 cents per mile.
Honda hiding the price of the car and fuel in an all inclusive subsidized lease.]

Just found Why fuel cell cars don't work - part 1 - mux' blog - Tweakblogs - Tweakers

 

[Svetlin]

Weekend O.T.

Clarity fills up in California for $80 for 366 miles of range. Or 21.9 cents per mile.
Honda hiding the price of the car and fuel in an all inclusive subsidized lease.

Love this. Check out the Honda sales guy around the 8-minute mark in the video

Journalist: "Why go through the trouble of having a fuel cell?"

Honda sales guy: "Let's just say we can all strive for perfection. And perfection would be having solar panels on your home and then charging your car directly from that."

Yes indeed! Thanks Honda sales guy, for making the sales pitch for Tesla while describing your pathetic effort at a zero emission car.

 

[Intl Professor]

Related: Who ever thought that TWTR didn't have value? Now they have some very well documented verified users, and is a source for 'news' and public policy....

But following on with what JHM so eloquently posted above about interest rates, isn't then the trend line then to zero for not only interest rates, but the content becomes zero net for news as well?

 

[drinkerofkoolaid]

God I hope so. We need to stop growing our government. The less it spends the better. (The government doesn't like letting itself be demolished, so I know the likelyhood of this, but if it is a secret GOP plot to actually shut it down for 6 months a year, that would be awesome!)
I seem to agree. (There is a bit of hindsight bias that I think I don't have but probably do, thus the "seem".)

You think it's a good idea if the government were to shutdown for 6 months out of the year??? Are you joking?

It would be a terrible thing if the US government simply stopped spending money.

They want to shrink government in all the wrong places (education, environment, federal land), expand military spending by ~ $60 billion, spend $1 trillion on a senseless wall, and increase the number of people incarcerated for non violent drug related crimes. Also, the alternative to the ACA (Obamacare) is a joke, intended to convince naive voters that the government is following through on its promise to repeal and replace the ACA.

Note: There need to be Federal standards for public education. It can't be left up to the states, because many states are run by people who aren't qualified to determine sound policy for running schools and many public schools in poor or poorly run parts of the USA have teachers who aren't qualified to be there. States without enough qualified teachers should be able to receive Federal assistance to hire teachers from states with people who are qualified from other states. The USA is basically the only "developed" country where there is a debate about if there should be Federal standards for public education.

Also, more money should be invested in magnet and trade schools.

The US government needs to stop spending trillions on "interventions". (Military actions). .

I'll be thrilled if the GOP passes rational comprehensive tax reform and plans for infrastructure spending. So far, the only rational ideas I've seen mentioned are the ones proposed by Elon. (Carbon tax + multi lane highways + Hyper-loop + Solar everywhere + Electric Vehicles). I have serious doubts there is enough brain power in the GOP to make this happen.

Maybe if Trump hands over control of infrastructure planning to Elon?