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2017 Investor Roundtable:General Discussion

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You've really covered the dilemma adroitly and eloquently raised the primary issue.
"Left and Right are socio-political labels between individualism and communal preferences in policy and human interaction."

I might have missed something in the original posting but....
Isn't boiling down the current Left and Right to individual vs communal preferences obscuring our current Left/Right political situation?
The far left is too eager to insure all citizens not endure suffering and few opportunities to have decent lives, by legislating hundreds of programs and making the higher income groups pay additional taxes to fund them. Often with little consideration of effectiveness.
The political middle (now mainly Democrats and Independents) attempt to balance the needs of the many with the desires of the few, i.e. the top 1%. They believe modest constraints on the actions of the few are rational and desirable in order to buffer hundreds of times more who are struggeling in the worst of circumstances (like no medical insurance and treatment when needed).

What the media call the Right (actually now the Far right) believe in is using their resources to buy political influence and get the outcomes they desire with no constrains. They want to see no limits imposed on their actions regardless of the impact on anyone else.
They pretend (or imagine) that acting with no regard to the needs of others will somehow lead to better a economic outcome for the U.S.
In many cases doing so leads to objectively worse outcomes. The 'Tragedy of the Commons' tale attempts to show some ways this is true. Elon Musk's frequent comments on "pricing the (currently) unpriced externalities of carbon emissions" is a good example of exceptionally talented individuals behaving morally by also acting for the common good. Even if that reduces the growth of their personal wealth to some degree.
 
In many cases doing so leads to objectively worse outcomes. The 'Tragedy of the Commons' tale attempts to show some ways this is true. Elon Musk's frequent comments on "pricing the (currently) unpriced externalities of carbon emissions" is a good example of exceptionally talented individuals behaving morally by also acting for the common good. Even if that reduces the growth of their personal wealth to some degree.

Well Elons proposal of a carbon tax would hit the poor the hardest. If you increase the price of carbon in a mainly carbon based economy you increase the price of everything indirectly. I think the best thing to do, as a state, is to incentivize the production of EVs and renewable energy and let things like the experience curve and economy of scale do their magic. Of course when the technology that you incentivize has not the potential to be cheaper then the technology you want to get rid of a carbon tax (in your case) would be necessary.
 
Well Elons proposal of a carbon tax would hit the poor the hardest. If you increase the price of carbon in a mainly carbon based economy you increase the price of everything indirectly. I think the best thing to do, as a state, is to incentivize the production of EVs and renewable energy and let things like the experience curve and economy of scale do their magic. Of course when the technology that you incentivize has not the potential to be cheaper then the technology you want to get rid of a carbon tax (in your case) would be necessary.

You'd be correct about a straight carbon tax hitting the poor the hardest, but that is not what's proposed when Congress has tried to get a Carbon tax. Mechanisms to keep poor and low income people from paying more for energy are always buil
When Elon advocates for a carbon tax, I believe he's advocating for one that includes these mechanisms.
 
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Respectfully, saying there are hardware problems as well as SW is far from saying additional robots are needed to solve them.
From the transcript: "We had to rewrite all of the software from scratch and redo many of the mechanical and electrical elements of zone 2 of module production. We've managed to rewrite what was about 20 to 30 man years of software in 4 weeks, but there's still a long way to go. It's -- because the software work can be fast with the electromechanical elements that need to be fabricated and installed, and that -- getting these items in place and rebuilt is, unfortunately, a lot longer, and that's -- it's probably more external constraints than software. "

So, you are right, robots are not specifically mentioned, but robots are hardware (and associated software). The distinction between a robotic arm and a specific bit of hw in a process is somewhat gray.
 
You'd be correct about a straight carbon tax hitting the poor the hardest, but that is not what's proposed when Congress has tried to get a Carbon tax. Mechanisms to keep poor and low income people from paying more for energy are always buil
When Elon advocates for a carbon tax, I believe he's advocating for one that includes these mechanisms.
Carbon taxes are applied to things one wants to discourage and used to pay for things one wants to encourage. For example, there might be a tax on heating-oil that is used to pay for upgraded power system. A tax on alcohol pays for addiction treatment.
 
Honda: Era of self-reliance is over

But the era of self-reliance is over. Today's Honda, a middling player on the global stage and increasingly squeezed by larger domestic rivals Toyota and Nissan, concedes it finally needs outside help to meet the challenges of the future.

______________________________________________________________________________________

Honda thinks economies of scale of ~4.5M units per year is not sufficient to compete effectively with Toyota,Volkswagen and maybe even Nissan-Renault.
 
Carbon taxes are applied to things one wants to discourage and used to pay for things one wants to encourage. For example, there might be a tax on heating-oil that is used to pay for upgraded power system. A tax on alcohol pays for addiction treatment.

No disagreement that a carbon tax program would seek to discourage use of fossil fuels to reduce amount of CO2 released to atmosphere.
Nor that taxes collected could be used to pay for whatever gov't programs Congress wished. But taxes collected (or a portion) could also be used to minimize as much as possible, impact on low income people. Taxes collected could be split in some fashion between both.
God they say is in the details. There are plenty of other countries that have implemented carbon taxes and/or trading of carbon credits to learn from in creating a U.S. program.
 
No disagreement that a carbon tax program would seek to discourage use of fossil fuels to reduce amount of CO2 released to atmosphere.
Nor that taxes collected could be used to pay for whatever gov't programs Congress wished. But taxes collected (or a portion) could also be used to minimize as much as possible, impact on low income people. Taxes collected could be split in some fashion between both.
God they say is in the details. There are plenty of other countries that have implemented carbon taxes and/or trading of carbon credits to learn from in creating a U.S. program.
Yes agree, the taxes *should* be used to reduce the impact on low income people, either as direct cash/guarateed income etc. or by reducing the cost of other things. However, just ducking it into general revenues would be a bad choice.
 
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@neroden your posts are consistently excellent, but what makes you believe new robots would be needed to resolve zone 1 and 2 problems? Likely that reprogramming of existing robots in the zones will be needed, but even if the redesign led to additional robots being needed (no evidence of that I know of) I'd be amazed if Tesla doesn't have a number of them in reserve as spares and for situations where some add'l are needed fast.

Hey, maybe you're right. I was just assuming the worst based on a couple of rumors that some of the robots had actually crashed into each other... I figured some of the hardware was probably broken and needed replacement. They did say that they needed to replace some hardware.
 
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Just wanted to follow up on my earlier post regarding Solar CITY . They were out on Thursday to install my system . It looks great and the team was fast and very professional ... it's a large system, producing over 12k kilowatt hours per year (24 panels) and they put it up in one day. The mounting system , which is proprietary , puts the panels very low to the roof which makes them look a lot better in my opinion .... it actually makes the house look more hi tech which is fine by me as it's a new build and is a "smart house" so it fits right in. NO idea how it functions yet as the city has to come out to inspect before it's officially turned on and working.

I think Tesla's foray into energy makes total sense long term for Elon's vision , short term I can understand one's issues but Tesla and Elon are about radical change and putting EV's and Solar power together is a no brainer. The day my model 3 (Scheduled for "Late 2018") is in my garage charging from the sun will be one I'll remember for a long time ..... game changed. EVERY buyer of a EV who is a homeowner would be a great potential customer ....

Excited to turn this system on .... excited to drive an EV and very excited to see where this stock heads in the next few years .....
 
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ok... why take M3s to NY on Friday?... if it's to "rejuvenate" existing shareholder's interests... what is the point?... clearly it's not for the bond holders... they already got this show... if it's for Fidelity or one of the large stakeholders, then they shouldn't need this... how is seeing a car going to convince them that Tesla will make profits and be able to produce 2M cars per year at some point in the future?... unless there is real concern that one of the large investors is about to exit... and the only card they currently have is "just look at this beautiful car!"... or they're trying to rope in new investors... for another round.

so it's either existing stakeholders are antsy and giving them another dog-and-pony show which is bad... or they're working on the next dilution... which is bad.

my guess is... it's to answer questions like: "just 3 months ago you told us you were on track for 5k/wk and 10k/wk was 100%... and you just built 300 cars... so what the **** just happened?"

Longs think Elon's exaggerations are "ambition"... shorts think they are lies... and all that really matters is what top 5 think... FMR, Baillie and Vangaurd, etc... the one's holding 25% of the float... and if any one of them get a sense of how shorts see this, there will be large dramatic drops in SP... so I guess we'll see in the coming weeks.
 
ok... why take M3s to NY on Friday?... if it's to "rejuvenate" existing shareholder's interests... what is the point?... clearly it's not for the bond holders... they already got this show... if it's for Fidelity or one of the large stakeholders, then they shouldn't need this... how is seeing a car going to convince them that Tesla will make profits and be able to produce 2M cars per year at some point in the future?... unless there is real concern that one of the large investors is about to exit... and the only card they currently have is "just look at this beautiful car!"... or they're trying to rope in new investors... for another round.

so it's either existing stakeholders are antsy and giving them another dog-and-pony show which is bad... or they're working on the next dilution... which is bad.

my guess is... it's to answer questions like: "just 3 months ago you told us you were on track for 5k/wk and 10k/wk was 100%... and you just built 300 cars... so what the **** just happened?"

Longs think Elon's exaggerations are "ambition"... shorts think they are lies... and all that really matters is what top 5 think... FMR, Baillie and Vangaurd, etc... the one's holding 25% of the float... and if any one of them get a sense of how shorts see this, there will be large dramatic drops in SP... so I guess we'll see in the coming weeks.


If any of them get a sense how Tesla longs (and Tesla customers) see the traditional automakers .... there will be HUGE dramatic drops in SP for those traditional companies. And inflow toward Tesla.
 
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ok... why take M3s to NY on Friday?... if it's to "rejuvenate" existing shareholder's interests... what is the point? how is seeing a car going to convince them that Tesla will make profits and be able to produce 2M cars per year at some point in the future?

so it's either existing stakeholders are antsy and giving them another dog-and-pony show which is bad... or they're working on the next dilution... which is bad.

In-person displays of the Model 3 gives investors the chance to see and experience the product, rather than simply know about it in the abstract. This is not about certainty. It is about potential. Obviously, there is the risk of failure, but that is true of any investment.

Look at Doug DeMuro's review of the Model 3:
. This is a guy who has only passing familiarity with Tesla, and actually says at the beginning of the video that he's not really dialed in to all the specifics of the car, and doesn't want the Tesla fanbase jumping all over him if he gets some of the detail wrong. His overall impression of the car by the end of the review is that it is amazing. This is a product that has potential.

My read on the way you see things is that you want certainty. I study your semantics, words/pharases like: "Convince" "will... be able to". From what I recall, you write or wrote computer software in the past, which in most cases is a fairly discrete endeavor (discrete as in opposed to continuous in the context of mathematics). X input should result in Y output. Finite State Machines. Mathematical Logic.

The success or failure of a complex, growing business cannot be predicted based on discrete reasoning. It isn't a digital system with logic gates and predictable output for a given input.


With respect to "dilution", again, this is frequently misunderstood. The total number of shares grows, but the company got something in return (capital). If that capital is put to good use for expansion, the overall value of the company goes up.



Longs think Elon's exaggerations are "ambition"... shorts think they are lies... and all that really matters is what top 5 think... FMR, Baillie and Vangaurd, etc... the one's holding 25% of the float... and if any one of them get a sense of how shorts see this, there will be large dramatic drops in SP... so I guess we'll see in the coming weeks.

It would depend on how those shares are held. Vanguard is something like 80% index funds, and even their active funds tend to be very conservative/deliberate in moving in and out of holdings. Holdings in index funds aren't dumped because the people managing the funds suddenly believe short sellers.
 
In-person displays of the Model 3 gives investors the chance to see and experience the product, rather than simply know about it in the abstract. This is not about certainty. It is about potential. Obviously, there is the risk of failure, but that is true of any investment.

Look at Doug DeMuro's review of the Model 3:
. This is a guy who has only passing familiarity with Tesla, and actually says at the beginning of the video that he's not really dialed in to all the specifics of the car, and doesn't want the Tesla fanbase jumping all over him if he gets some of the detail wrong. His overall impression of the car by the end of the review is that it is amazing. This is a product that has potential.

My read on the way you see things is that you want certainty. I study your semantics, words/pharases like: "Convince" "will... be able to". From what I recall, you write or wrote computer software in the past, which in most cases is a fairly discrete endeavor (discrete as in opposed to continuous in the context of mathematics). X input should result in Y output. Finite State Machines. Mathematical Logic.

The success or failure of a complex, growing business cannot be predicted based on discrete reasoning. It isn't a digital system with logic gates and predictable output for a given input.


With respect to "dilution", again, this is frequently misunderstood. The total number of shares grows, but the company got something in return (capital). If that capital is put to good use for expansion, the overall value of the company goes up.





It would depend on how those shares are held. Vanguard is something like 80% index funds, and even their active funds tend to be very conservative/deliberate in moving in and out of holdings. Holdings in index funds aren't dumped because the people managing the funds suddenly believe short sellers.
the stock currently trades as if it is certain that Tesla will overtake BMW within the next 3 to 5 years... there better be certainty that Tesla can hit little targets like 5k/wk... while BMW has been hitting 50k/wk for a very long time.
 
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I think Tesla's foray into energy makes total sense long term for Elon's vision

True, but the value Tesla got from the purchase of solarcity was minimal. The solar business is just "treading water" until Tesla has well differentiated product to sell.

A crappy business model is a crappy business model, even with cousin Elon as chairman.
 
the stock currently trades as if it is certain that Tesla will overtake BMW within the next 3 to 5 years... there better be certainty that Tesla can hit little targets like 5k/wk... while BMW has been hitting 50k/wk for a very long time.

First, I think it is a big mistake to ascribe the mental state of "certainty" to the way a stock trades. Algobots often trade on momentum/technicals. Human market participants have a wide variety of reasons/rationales for buying or selling a stock. Anyone who "knows" for certain that something will or won't happen with a particular stock either way is probably delusional.

The cold hard truth is that the future is a gamble. There is no certainty. There never has been.

Which brings me back to the example of Apple:

June 2008 market caps (via Zacks.com):
Nokia (NYSE:NOK), about 103 Billion USD.
BlackBerry (NYSE:BB), about 74 Billion USD.
Apple (NASDAQ:AAPL), about 152 Billion USD.

In the iPhone through iPhone 3G/3GS era, Apple accounted for an almost negligible % of the mobile phone market: List of best-selling mobile phones - Wikipedia

iPhone should have been destroyed in the mobile phone marketplace. Margins should have been low. Android phones with the same or better functionality should have relegated iOS to the same near irrelevance as MacOS had been by the late 90's. By all conventional wisdom, there was no certainty at all Apple would have avoided being destroyed by the likes of Nokia and BlackBerry as convergence of MP3 players and mobile phones wrecked the iPod mobile music business.

That didn't happen.

By any reasonable historic metric, Tesla should have been dead 9 years ago, before it even IPO'd.

As a car enthusiast, a supporter of the transition to EVs and renewables, and the holder of an insignificant number of Tesla shares, I hope that Tesla will succeed, but I do not take it as a given. I simply prefer to gamble on the success of ambitious entrepreneurs with an uncanny knack for survival, rather than the random roll of dice.
 
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