Tesla Investor's General Macroeconomic / Market Discussion

[Causalien]

It shouldn't hurt you as long as you know it's not true,

When pal call you names, they've usually lost the logical argument.

One of the signs I look for before I invest in something, is to have people call me an idiot. It means I triggered some emotions. Now I just need to validate if that emotion is justifiable to bet against.

 

[Causalien]

My final thought on this matter can be summed up by an incident that happened a while ago before I "left".

There was a guy from China who provided on the ground information. He physically visited stores in TSLA and online forums inside the great firewall and brought it to us. Providing vital cultural "feels" at his own cost. Just the fact that he bothered going through a paid VPN and specifically comes here to give us the information is worth some respect.

He was hounded out because at some point, his view turned bearish (and justifiably so because TSLA was botching up China) on top of his cynical and more pessimistic view on the market. I no longer see him posting on investment threads so I assume he got pissed. Just as I got pissed after my own vocal opposition on the SCTY merger and run ins with ultra bulls.

From the perspective of a information provider. These are researches that costs time and money to do and we provided this for free. After such incidents, the most normal response from us would be :"I'll just shut up and make my own money and do my fiduciary duty to those who are invested with me. Those who weren't here in the beginning and those who I don't know doesn't matter"

 

[sundaymorning]

My final thought on this matter can be summed up by an incident that happened a while ago before I "left".

There was a guy from China who provided on the ground information. He physically visited stores in TSLA and online forums inside the great firewall and brought it to us. Providing vital cultural "feels" at his own cost. Just the fact that he bothered going through a paid VPN and specifically comes here to give us the information is worth some respect.

He was hounded out because at some point, his view turned bearish (and justifiably so because TSLA was botching up China) on top of his cynical and more pessimistic view on the market. I no longer see him posting on investment threads so I assume he got pissed. Just as I got pissed after my own vocal opposition on the SCTY merger and run ins with ultra bulls.

From the perspective of a information provider. These are researches that costs time and money to do and we provided this for free. After such incidents, the most normal response from us would be :"I'll just shut up and make my own money and do my fiduciary duty to those who are invested with me. Those who weren't here in the beginning and those who I don't know doesn't matter"

The person you mentioned was harping too much about short-term negatives, with no long-term positives in site. From recollection, his short term thesis was amplified due to a few lucky black swan events such as the Ukrain/Russia incident which came out of nowhere, a model S catching on ... which also came out of nowhere..at any rate, he’s gone now and hasn’t made a dime from the long-term uptrend that Tesla provided since his departure.

We have very smart people here both short and long term investors, many of us don’t have problems listening to people, but when they spill gloom and doom on every post, that’s when it gets annoying. From my angle, I’m glad he’s gone and much more glad the long-term sentiments prevailed. I would have to disagree with you on the Solar City merger, that $2 billion back then was expensive, but is looking to be a steal right now once they ramp in Buffalo, my friend installs for Solarcity he also see’s the deal as a steal. Just look at how many car manufactures want to get into the power-pack business now. Once they do, guess what businesses they’ll likely also need to be competitive with Tesla?

Your view and *his view might be short-term, but there’s lots of people here looking to make money long term, and quite frankly, if short term investors don’t have the stubbornness to stick around, theyll likely miss the train like *he missed the last bounce (I bet his short term view didn’t see that coming).

Do you see any of the old timers here attacking guys like DaveT? No, despite his pessimism at times, his views are balanced. There’s your difference between Maoing and people like DaveT.

 

[Intl Professor]

Here's abundant evidence developers, like Kushner and Trump--before he changed his business model--would be adversely affected by a trade war. Mutatis mutandis for exporters like Tesla and farmers.

Opinion | The Macroeconomics of Trade War

 

[renim]

The EU is basically a trade pact (coal and steel) that has accreted power until it basically controls Europe. It is not democratic (actually its enthusiasm to trump national democracies revel a tendency for selective anti-democratcy), the EU is striking similar to the Soviet Union, except the EU uses trade as it tool of coercion instead of tanks.

As such the EU will be professional and precise in a trade war, they are very practiced at protectionism.
but the EU cannot afford to lose (or even stalemate), I get a sense of deja vu about EU today and Soviet Union circa 1980s.
The strength of the EU is Germany, the strength of Germany is their automobile industry.
Dieselgate is nothing, but if German car industry fails due to electrification in China and equal protectionism in USA. Then...

I am reminded of Nokia, the world was their oyster and then they lost all three tiers of market simultaneously
(entry tier to Chinese 'bar' phones)
(mid tier to Android)
(premium tier to Apple)

 

[SwTslaGrl]

From a European perspective perhaps free trade agreements outside/excluding the US will accelerate? Like the current TPP? Will it be an advantage?

 

[HG Wells]

Perhaps rumors of Canada joining the EU?
As an equal trading partner.

 

[Curt Renz]

In 1986 I interviewed Milton Friedman and his fellow economist wife Rose at a San Francisco Bay Area TV station near where they were then living. We discussed free trade vs. protectionism. Afterward Milton gave me the contact information for the Indiana man who made his Adam Smith ties. I do not have a recording of that interview, but below is an excerpt from the Friedmans' 1980 PBS series "Free to Choose" in which Milton argues with a union leader who supported protectionist tariffs.

 

[Curt Renz]

Paul D. Ryan, the Republican House speaker, criticized President Trump’s proposed steel and aluminum tariffs on Monday, saying they could lead to a damaging trade war.

NY Times - 15 minutes ago: Trump Uses Tariffs as Threat in Nafta Negotiations

 

[Reciprocity]

Mutatis mutandis for exporters like Tesla and farmers.

Can you please rewrite this sentence so us blue collar folks can understand it. I even looked that stuff up and cant figure it out. I am trying to figure out if I should be offended or happy.

 

[Curt Renz]

US Constitution: “All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.”

Yet Congress abrogated its responsibility through legislation during World War I, and surrendered it to the president in regard to tariffs, which are taxes ultimately paid by American consumers.

As I have done, you want to write your congressmen to take back their obligation to represent you in the matter of tariffs. One American should not have the power of an absolute monarch to alone declare laws related to this.

 

[gene]

As I have done, you want to write your congressmen to take back their obligation to represent you in the matter of tariffs. One American should not have the power of an absolute monarch to alone declare laws related to this.

Curt, yes, I have done this and encourage others to do the same.

 

[Intl Professor]

Can you please rewrite this sentence so us blue collar folks can understand it. I even looked that stuff up and cant figure it out. I am trying to figure out if I should be offended or happy.

Push the "take your pick button." I don't intend to offend but do inadvertently. When called on it, especially by my lovely wife, it is healthy to be reminded the mouths of the highly educated are large enough for both feet.

 

[Reciprocity]

Push the "take your pick button." I don't intend to offend but do inadvertently. When called on it, especially by my lovely wife, it is healthy to be reminded the mouths of the highly educated are large enough for both feet.

Thanks for clarifying. I feel smarter already.

 

[Curt Renz]

Since Trump did not announce the tariffs as being immediately effective, they may be just a negotiating ploy. If Cohn knows that is the case, he may be resigning to make the tariff threat appear legitimate along with more personal reasons. In any event, the tariff threat game could keep the market confounded while the outcome is still unknown.

 

[GoTslaGo]

Since Trump did not announce the tariffs as being immediately effective, they may be just a negotiating ploy. If Cohn knows that is the case, he may be resigning to make the tariff threat appear legitimate along with more personal reasons. In any event, the tariff threat game could keep the market confounded while the outcome is still unknown.

Hopefully you are right. This would make this an amazing buy opportunity (considering how tomorrow is looking just based on after hours prices... solidly lower at this point). Personally would wait at least a couple of days to pull any triggers, and see how the technicals start to settle out. JMHO.

 

[sundaymorning]

There’s been some talks here and there about inflation, and how the housing market has slowly creeped up to 2007 levels. I’ve put some time into thinking about this and want to throw out some justifications for what looks like very healthy American spending, or some may put it, “inflation.”

First, although the latest recession broke a lot of people’s accounts, however, on the other side of that same deal were some very smart/lucky sellers who made away like bandits. Those sellers easily saw their net worth increased by 100s and 1000s of dollars, for these lucky sellers, a bad economy was like hitting the lottery twice. Their buying power likely contributed to the real estate prices we’re seeing today..

Second, Chinese investment! Very wealthy Chinese investors are taking advantage of our green card handout.. buying real estate and contributing to rising prices, often times paying in cash.

Third, banks aren’t giving out bad loans, similar to some “zero down” cases we’ve seen in 2006. They’re getting smarter, try talking your bank into a $500,000 loan at 5-10% down and see if it’ll happen. Of course this will depend on your income which leads to my next point:

Looking at our robust jobs number and steady GDP data from the US and Asia, I just don’t see recession for 2018 and first half 2019. Sure prices are going up, but I’m thinking that’s justifiable as more money is floating around. Look at the weed market for example, it’s basically tapping into a “new market” generating new revenues which, in turn, generates more spending.

Sure the average American is borrowing more, heck im borrowing more nowadays too, but I think it also signals confidence that our jobs will eventually help us pay off debt.

 

[Intl Professor]

Apologies if already posted. Here is a rather comprehensive survey of reactions to Trump's go it alone trade policies. This has been widely reported in the past but now near fruition. (Also includes possibility U.S. will rejoin.) Beware, offers data on growth expected for world GNP which is positive in contrast to the neolithic criticisms of free trade. Does not include much on Europe.

U.S. Allies to Sign Sweeping Trade Deal in Challenge to Trump

 

[PismoPat]

Since Trump did not announce the tariffs as being immediately effective, they may be just a negotiating ploy. If Cohn knows that is the case, he may be resigning to make the tariff threat appear legitimate along with more personal reasons. In any event, the tariff threat game could keep the market confounded while the outcome is still unknown.

Like an army prepares the battlefield, Trump prepares the negotiating table. You see it beginning to work with N. Korea. The tariffs are just pre-negotiating prep. You can see it as a card to play with NAFTA. It could also be a card to play with China on NK.

There will be some tariffs, but the final landscape 3 months from now will be much different than what Trump signs this week.

 

[Intl Professor]

Trump a Good Negotiator?

Not directly related to investing, but I'm curious as to how effective a negotiator in a real world situation Trump is. If he really had some secret sauce one would have expected Trump University (right title?) would have been a success. Also, regarding traditional U.S. banks, eventually they had it with the guy. (If I remember correctly when they finally lowered the boom he was required to sell his yacht and restrict himself to spending only $800,000 a month.) Partners, labor, contractors, and creditors certainly took a bath over his casino plays in Atlantic City. But the success of the ventures does not address the issue of whether they were good deals to begin—a test of his negotiating skill.

Market Concerns

Bear in mind investors are already somewhat squeamish about tariffs, see the markets over the past week. Nuclear war or any Korean conflict will have an effect on the markets now and maybe profoundly. If it occurs it might start during the planned joint operations scheduled by the U.S. and South Korea in several weeks, just as Trump and Kim are to meet for a summit. An accident during such maneuvers or some outrageous attack against our fleets by the North (not likely) could be a pretext for escalation. Also, it is possible such maneuvers often are a pretext for wider war, cf the Tonkin Gulf incident. Whether the maneuvers are really a cover for taking out Kim, he must fear it a possibility.

Two Bullies Meet

The summit announced tonight by South Korean diplomats in a brief TV appearance at the White House sounds like a well-orchestrated ploy by two small elephants, the Koreas, one medium sized elephant, Japan, and a near jumbo in China. All Asian elephants who have joined together in a real tease of an offer to tame a rogue who dares to match his arsenal of nukes to the pitiful inventory of Kim's. (Regarding nuclear weapons, Churchill famously said, "it may not matter how high the rubble bounces." It is reputed Tillerson's calling Trump an idiot was prompted by a conversation over nuclear weapons.)

The End Game

The usual commentators in tonight's news fail to note success in this endeavor is mandatory. No party can lose face. Failure means war. I sincerely hope negotiations start by discussing a peace treaty, what it should include, who gives what, who gets what, and how to get there, bearing in mind that everyone must win or at least think they win. This armistice situation with a lot of huffing and puffing on both sides, has gone on long enough so the lesser powers with much more than we at stake in the outcome have set a trap. Georgy Arbatov in selling Gorbachev's retreat from Eastern Europe once said, "we are going to do something terrible to you, we're going to deprive you of an enemy." That is the intention of the two Korean leaders and the Chinese. It is in the interest of the Japanese though I have little knowledge of their position. They are surely more interested than Trump in avoiding another nuclear war since they have searing memories of the first.

An advice.