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2017 Investor Roundtable:General Discussion

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" Give unto Ceasar what is Ceasar's and give unto God what is God's"

Jesus was not a totalitarian.
He was definitely a communist, though. Do you know anything about the history of anarchist communism?

Jesus never condoned the State taking by force from those that have a lot to redistribute to those that have a little.
Actually, he did; you should try rereading the section about the money changers.
 
It was always a mystery to me why the conservatives are so pro capitalism, capitalism is the archenemy of conservatism,

Well, the right-wing leaders in the US and several other western countries are in fact NOT pro-capitalism. They hate free markets. They want monarchy, monopolies, and government-granted (royal) patents. Capitalism is way too *anti-establishment* for them.

But that's a really unpopular position these days, so they pretend to support capitalism in order to get votes, and then subvert it into "crony capitalism", a.k.a. aristocracy.

If they didn't have to win votes they wouldn't pretend. Democracy is important. Of course right-wingers try to supress democracy too, with everything from throwing voters off the polling lists to gerrymandering.

I'm talking about the right-wing leadership, of course. Grassroots right-wingers are just... well, the politest way I can put it is that they're being conned.
 
Came back from a deserved(?) holiday and break of all things Tesla (not completely, I tried). I am probably missing it, but I don't find any serious discussion on the conference call nor the 10-Q. Where should I look?

For now I am reading the transcript of the call. A bit puzzled by the inventory. Not so much with their plan to reduce it (I was hoping they'd already do so this quarter). But specifically that they need to scale down production? From every single metric it's clear demand is really strong and higher than current S/X production capacity. Inventory will draw lower naturally even if they keep production up, so why go an extra mile?

This is actually a good question. Some possibilities:
-- I am not 100% sure that S demand is stronger than current S production (X is another matter), and I'm not sure how much they can switch from S to X (the production line is less switchable than they had hoped)
-- Both S and X have substantial manual aspects to production and maybe they are reassigning some of those workers to do something else. For instance, if the bottleneck is one station where they had extra workers, maybe those workers have been pulled off to do something else.

Just throwing ideas out.
 
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praying? who are you kidding... did you look at the 10-Q?... Tesla is a 10+ year experiment of an idea that's now required to become a real company... not just a brand... one that's capable of sustaining themselves... they can not scale up with the dependence of a-billion-here-a-billion-there cash injections they've been living on this whole time... the capital injections will not scale with the expectations of the M3... they've got one more cap raise left before it's all or nothing... and who the hell is going to be stoked to pump this story further if they don't materialize by Dec?

insideevs shows 1xx M3s delivered in October... the market cap remains $50b... if they don't show thousands by Nov there'll be a negative run on this stock because the risk of a Dec disappointment will be too great to continue.

everything depends on the next... very apparent... cap raise... and if macro doesn't hold up... then it will be that much worse.

if anyone should be praying... it should be those hoping Tesla makes it through the next 6 months without having to scale back to something equivalent to a $10B market cap maintaining their current line and reducing growth expectations. yes... 1/5th the current SP... that's fair value for an auto company of Tesla's EXISTING size.

This is a common issue I observe: people believing that X input must lead to Y result.

“Will happen” is a huge Red Flag, whether it’s written by you, or an Uber Bull like Julian Cox.

And even if you were correct on valuation, the market can stay irrational far longer than you will be solvent. This is true for both sides of any stock bet. In any case, your increasingly fervent posts declaring your hope to be fact, do not show much confidence in the bear thesis. If you want valuation, stick with Blue Chips. TSLA is r/WallStreetBets material, where the reward is either a yacht worthy of Donald Trump, or the punishment is being able to show the rest of the subReddit a $0 RobinHood account balance.
 
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Tesla Is Biggest Short in North America
This is such an insane list. Some of the companies on this list are ones I don't like, but they're all *much* too dangerous to short over a significant time period.
 
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Says who? Not every company wants to be a 'big boy', nor should they. Smaller companies have lots to offer; like attention to detail, passion, custom orders etc...



Maybe, maybe not. They'll be good at copying in large quantities. Other than that, they'll need to be judged on the products. Let me just pick one off the top of my head: Takata. How'd that work out?



So the upstart in Silicon Valley that goes by the name of Tesla couldn't be competitive, eh? Hmm...I think there was another upstart called SpaceX that also couldn't be competitive. Oops.

Bigger is not always better. Bigger doesn't guarantee anything.
I agree whole heartedly. More companies of more sizes from more places make for better outcomes. I never said Tesla couldn't be competitive, and certainly have never said SpaceX couldn't be competitive. Government and especially defense contractors are the most inefficient monstrosities on the planet. Superbly ripe for disruption.
 
Well, the right-wing leaders in the US and several other western countries are in fact NOT pro-capitalism. They hate free markets. They want monarchy, monopolies, and government-granted (royal) patents. Capitalism is way too *anti-establishment* for them.

But that's a really unpopular position these days, so they pretend to support capitalism in order to get votes, and then subvert it into "crony capitalism", a.k.a. aristocracy.

If they didn't have to win votes they wouldn't pretend. Democracy is important. Of course right-wingers try to supress democracy too, with everything from throwing voters off the polling lists to gerrymandering.

I'm talking about the right-wing leadership, of course. Grassroots right-wingers are just... well, the politest way I can put it is that they're being conned.
So, so true.
 
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This is such an insane list. Some of the companies on this list are ones I don't like, but they're all *much* too dangerous to short over a significant time period.

Wal-Mart is the most vulnerable in my opinion. Mainly because of amazon. Shorting amazon is one of the dumbest things you can do as far as I can tell. Hey guys let’s bet against the company that’s practically taking over the world.
 
This is such an insane list. Some of the companies on this list are ones I don't like, but they're all *much* too dangerous to short over a significant time period.
That list is ranked on dollar value shorted. For others in the list like Apple, the short interest is a very small fraction of the market value. A lot of these short positions, especially in Apple, are likely hedge positions.
 
I have decades of experience designing computer systems with security in mind... whether or not I've driven a Tesla has nothing to do with this subject.

but I will answer your question... I've not driven a Tesla or owned one... If I did, I'm sure I'd enjoy it... I'd probably think it was one of the best cars I've driven...
Myusername: drive the car. Just take it out for a good long test drive (though overnight is better -- it took a couple of weeks for me to really appreciate this). I know you trade based on technicals, but you cannot understand the company unless you understand the product, and you don't understand the product.

You will not "think it was one of the best cars [you've] driven".... rather, you will start wondering what's wrong with all the other cars. Your entire viewpoint will shift and you will *only* consider 100% electric cars to be competition. There are very few people who have gone electric and then gone back to junky gasmobiles (I think Leonardo DeCaprio is one). It seems like you still haven't figured out that this is how it works.

This is why those of us who get it are looking intently at the *electric* competition and laughing at the ICE "competition". Take a drive and you'll get it.
 
For Tesla, I could care less about the tax credits. Tesla is the only company that no longer needs them. If 100,000 model 3 reservations cancelled, it would leave 400,000+ or and endless amount of insatiable demand. Where as companies building compliance cars will lose $7500 more per car. Maybe they will but zevs from Tesla instead.

I cant believe I'm saying this but I agree with @myusername that the macro effects of no tax reform will be bad and really bad for Americans. The lib hatred for all things Trump has clouded your minds to what is really a good deal for middle and lower class Americans

It's not, though. The massive tax breaks for billionaires end up being a bad deal for middle and lower class Americans, because the billionaires turn around and spend the money bribing Congress to make things even worse for middle and lower class Americans. I've watched this happen too many times before. :-(

Also, it's a massive tax increase for middle class people in a state with an income tax, which are IMNSHO all the good states.

If the Republicans would propose a tax reform which didn't include massive tax breaks for billionaires and for billionaire corporations, then I'm sure it could get broad popular support. But for some reason they refuse to. (And yes, it's easy to do this: just take the rest of your tax reform proposal and add an Eisenhower-style 90% tax bracket for those with more than a million a year in income.) For some reason, the Republicans in Congress always (well, since 1980, they were different before 1980) refuse to propose a tax reform unless it has huge tax breaks for billionaires. Ever wondered why?
 
I 100% agree on the political interpretation, but for the business, not so much. Ford didn't move away from the founder's original method because they became corrupted. They moved away from it as the industry matured. When Ford assembled the line for the Model T, he was creating the market almost as much as he was creating the product to fill that market. He wasn't competing against 15 other mass market automobile companies.
What you're missing is that Tesla isn't either. So far, I see the Renault Zoe, Hyundai Ioniq Electric, the Nissan Leaf (ha), the Chevy Bolt (self-inflicted production limits), and some Chinese startups. This is very similar to Ford's position when he produced the Model T -- actually Ford had *more* competition.
 
3) BEV's are simpler to manufacture than ICE's, especially if they were designed from the ground up to be BEV only like the Model 3. In the past the cost savings from simplicity has been overshadowed by the higher cost of the batteries. That is no longer true for Tesla.

I will point out that Tesla is currently sacrificing some of the natural manufacturing simplicity gains from "BEVs are similar to manufacture than ICEs" by attempting to automate things which are usually done manually in other factories (like seat installation), which causes manufacturing complexity.

I think this is a worthwhile move.
 
It's not about just firing people who make a bad part. It's about managing a business so that it is constantly improving. You don't want just standard parts. You want better parts this year than last year.
If you pay attention to those of us who own Teslas, you will know that in the hardware they are doing exactly this constantly, at a MUCH faster rate than ANY other car company I have ever seen. My car (!) has version 2 of the side mirrors, something like the 29th version of the drivetrain, version 5 IIRC of the door handles, version 2 of the chargeport, etc.

Outside companies will innovate to win new business. The widget department just keeps making them to spec to avoid getting fired.
You assert that, but it turns out not to be true with Tesla. Now you know.
 
You do realize that those people are considered filthy rich in the real world , don’t you?
People with $100K incomes may be considered filthy rich by the ignorant, but they're not actually.

Billionaires are filthy rich. Actually, this perception failure is a major political problem -- a lot of people just don't understand how rich billionaires are. Can't comprehend the idea that one person's wealth could set up 1000 people for life (and that would just be a billionaire -- for a 10 billionaire, it would be *10,000* people). There are a lot of people who think "rich" and think of a college professor or a doctor. Compared to a billionaire, college professors and doctors are poor people, and the billionaires certainly know this.
 
Yes they will lead in innovation and efficiency for two reasons:

- The captive supplier is able to optimize for their single customer's requirements. Serving multiple customers with different requirements dilutes that ability.

- The CEO's mantra is innovation and efficiency. Therefore all parts of the organization will focus on innovation and efficiency.

Yes. And to be the downer about Tesla for a change, the CEO seems unconcerned about legal compliance or customer communications, so those areas will be weak. Which they are.

Currently I think this isn't a fatal flaw, but it's worth watching.

It gets annoying listening to *silly* bearish arguments when I can make better bearish arguments based on Tesla's demonstrated weaknesses.
 
Devils advocate; let’s say back in 2009 and you’ve saved enough to build your dream house, but a friend asks you for money to save his startup making electric cars, he won’t be able to pay the bills soon. So you forgo the house gave him a big chunk of your saving figuring you’ll probably lose it all. Well it 2017 and you decide to sell your shares, you are now “filthy” rich. According to the irs that is unearned income and you pay 20% tax on it. But that was a pretty gutsy investment, and you sacrificed building your dream home at the best time to build a home in decades. So was it earned ? Are you “filthy” rich? Would you baulk if you had to pay 40% tax + fica on it?

It's unearned (which doesn't mean it wasn't a gutsy gamble -- gambling income is also unearned). And I'm perfectly happy to pay normal tax rates on it; I don't need a discount. My stock, in this scenario, went up by a factor of 10 or 20. The difference between 20% tax and 40% tax? It seems chintzy to squabble over that. I'm willing to pay my fair share. I don't feel that I should get to pay a lower rate than someone who sweated for hours every day to make their money.

(P.S. I would complain if I had to pay *higher* rates on unearned income than on earned income, but right now it's earned income which pays higher rates than unearned income.)
 
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