Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Nocturnal]

Interesting to see that my short shorts may be delivered this week.

America does not recognize mob rule. We have a judicial system that operates by rule of law. Amazon would have to be found guilty of using unfair business practices to stifle competition in order to be broken up.

Ehh, not sure I agree there. People pressure politicians and those guys only care about their own interest, not what's right.

But the important bit in all this is really, do you think a 40T valuation is possible? I do think Tesla will dominate several industries, but wouldn't that require complete ownership of auto, insurance, and energy? And believe me, I don't enjoy being wrong, but I'd love for you to call me in 10 years and laugh at me for doubting this.

 

[StealthP3D]

Sub-25% market share is not a monopoly in any sense of the word, let alone the legal one.

Illegal behavior is not defined by market share. That's simply a measure of how popular a companies products are. Anti-trust law regulates corporate behavior and business practices, not market share percentages.

 

[ggies07]

This could go into several different threads, but I think it should be in here to get the most exposure since this directly affects Tesla's mission statement:

Trump administration buries dozens of clean energy studies – InvestigateWest

Documents obtained by InvestigateWest identify at least 46 reports from almost every program within the U.S. Energy Department’s energy efficiency and renewables office and seven national labs that have been stalled, downgraded or spiked.

 

[Knightshade]

20 million units is fine, but how does Tesla get to a 40 trillion dollar valuation without being completely dominant in several industries? Am I missing the path to that valuation?

40T is a ridiculous fantasy number roughly double the entire US GDP.

It's why I referenced back to the # of annual vehicles produced by Elon for 2030 to ground things a bit.

Even if they had comparable market shares of both the auto insurance and energy markets by then you wouldn't be anywhere remotely near 4T in value, let alone 40.

 

[Knightshade]

Illegal behavior is not defined by market share. That's simply a measure of how popular a companies products are. Anti-trust law regulates corporate behavior and business practices, not market share percentages.

They absolutely consider market share under US law.

Monopolization Defined

Courts look at the firm's market share, but typically do not find monopoly power if the firm (or a group of firms acting in concert) has less than 50 percent of the sales of a particular product or service within a certain geographic area. Some courts have required much higher percentages

25% is, obviously, well short of 50.

Nothing in the other aspects discussed or defined there could reasonably applied to a company with a 25% market share either.

Though certainly if you can cite any US court cases decided against a company or group acting in concert with a 25% (or even close to that) market share on anti-trust grounds I'm open to them.

 

[Paracelsus]

on a lighter note...
"
Update—Tesla Short Shorts (order 1252116)
We appreciate your patience and excitement as we work diligently to get Tesla Short Shorts to you.
As an update, we will begin deliveries of this product starting this week. Once your order has shipped, you will receive an email confirmation with your tracking number.
We expect all deliveries to be completed within the next several weeks. Should you have any questions, feel free to reply to this message.
As always, thanks for your continued support.


Inbox

Elon's cryptic confirmation of S&P500 inclusion without violating any rules....................at 420 of course

 

[StealthP3D]

Interesting to see that my short shorts may be delivered this week.


Ehh, not sure I agree there. People pressure politicians and those guys only care about their own interest, not what's right.

I agree with that but politicians are not the judiciary. Anti-trust law is imposed by courts according to the rule of law, not politicians.

But the important bit in all this is really, do you think a 40T valuation is possible? I do think Tesla will dominate several industries, but wouldn't that require complete ownership of auto, insurance, and energy?

Of course I believe $40T valuation is possible but it's not going to happen by 2030 unless the dollar is greatly devalued. These things take time. And depending upon the timeframe, and the growth of the overall economy (and other factors like inflation), no I don't expect complete ownership to be necessary or even desirable to achieve a $40T valuation.

What makes me think such valuations are possible (in time) is how the status quo has become so complacent and lacking when it comes to true innovation. This problem extends well beyond the auto industry into just about every industry that sells anything. Tesla is literally rewriting the book on how to run a profitable business while adhering to ESG principles. It's showing what is possible when efficiency is taken seriously. This is exactly what's needed to continue to increase standards of living worldwide while solving the biggest problem facing us today (climate crisis).

 

[jerry33]

America does not recognize mob rule. We have a judicial system that operates by rule of law. Amazon would have to be found guilty of using unfair business practices to stifle competition in order to be broken up.

Yes, but with skillful lawyering and lobbying justice is often not blind. (Think patent troll friendly courts in Texas.)

 

[mongo]

Well your first problem is the model 3 doesn't actually support V2G

If connected via DC link (Supercharger contactors engaged) to a grid aware combo inverter EVSE along with Gateway/ PW and optional solar, it does.

Car is not ideal for primary backup, but great for secondary capacity/ recharging the local fixed storage (assuming power is available somewhere within driving distance)

 

[ThisStockGood]

Interesting to see that my short shorts may be delivered this week...

Interesting if this batch is the MIC Short Shorts with matte black outline stitch... can't wait to receive

 

[StealthP3D]

They absolutely consider market share under US law.

Monopolization Defined




25% is, obviously, well short of 50.

Nothing in the other aspects discussed or defined there could reasonably applied to a company with a 25% market share either.

Though certainly if you can cite any US court cases decided against a company or group acting in concert with a 25% (or even close to that) market share I'm open to them.

It's not the market share that gets regulated - it's the abuse of that monopoly power that is regulated. A basic tenant of anti-trust law is that regulated behavior must be harmful to consumers. If the monopoly is due to innovation that allows the company to offer superior products at superior prices and the company is not using that monopoly power in an unfair manner to prevent others from competing, there is no legal ability (or justification) to break it up.

The definition of a "monopoly" is useful but it's only one test that must be passed before anti-trust law can be used against a company. A monopoly, in and of itself, is not illegal.

This is important to understand because it can directly impact the ability to value a company like Tesla now.

 

[vikings123]

Oh *sugar*. Tesla Short Shorts are starting to ship!

If this was a normal company this wouldn't matter. I'll be loading up. [aka...holding through the sh!tstorm]


View attachment 602840

10Q drops on Monday morning.
Short shorts start shipping out on Tuesday.
How is this not a bullish sign for S&P inclusion? It's almost like Tesla is making it so obvious now that people are not ready to believe it. I think it's happening this week and I'm buying a few options based on this read. YMMV

 

[StarFoxisDown!]

While the light volume continues, I'd rather just have the markets do nothing or go down....since I feel any rally in the macro's is going to result in Tesla being capped/walked down.

 

[StealthP3D]

40T is a ridiculous fantasy number roughly double the entire US GDP.

Time and innovation are two GREAT equalizers. Especially time. Never under-estimate the power of time when it comes to change, investing and wealth.

That's why I agreed $40T is not going to happen by 2030 (because that's only 10 years). But it might not take as long as you think either. The power of compounding is amazing.

 

[jerry33]

10Q drops on Monday morning.
Short shorts start shipping out on Tuesday.
How is this not a bullish sign for S&P inclusion? It's almost like Tesla is making it so obvious now that people are not ready to believe it. I think it's happening this week and I'm buying a few options based on this read. YMMV

I doubt there are any S&P committee members that I would care to see in Tesla short shorts (or any other brand of short shorts for that matter).

 

[StealthP3D]

While the light volume continues, I'd rather just have the markets do nothing or go down....since I feel any rally in the macro's is going to result in Tesla being capped/walked down.

So, you are recommending going all in with an Iron Butterfly strategy?

 

[cricketman]

40T is a ridiculous fantasy number roughly double the entire US GDP.

I agree with you conceptually, but when I do the maths, I see TSLA getting well over $10tn valuation by 2030

20M vertically integrated cars with Tesla batteries and Tesla insurance. 25% margin at ASP of $40k is $10k * 20M = $200bn margin

Conservatively, lets put a multiple of 30 for market cap. Therefore $6tn valuation

Now, we need to add in energy. Tesla has said they see energy getting as big as automotive. Lets say that by 2030 they are producing as many batteries for energy as for automotive at a similar margin. Therefore this adds $2tn to market cap. Now we need to add in solar roofs. A solar roof costs as much as a car, so another $2tn.

So we are now at $10tn, and this does not include the two most profitable areas that have the biggest potential markets
1. Energy trading
2. Autonomy

How do we value that? This is gong to be another $10tn again, maybe not by 2030 but eventually. Potentially could be much more

Now ignoring the maths and going with common sense, I think that in 2030 we will be ten times todays valuation, so something like $5tn market cap. I think Tesla will struggle to get to 20M cars by then, probably it will be 10M. I think it will be slow growth from 10M upwards, the exponential will start to slow.

But whatever, I am going to struggle to hold my TSLA shares across this whole journey. I am confident we will get to $500bn market cap by end of this year and $1tn maybe even by end of 2021. Then a steady 30% yoy growth until end 2030 (with the odd macro shock/bust), similar to AMZN/APPLE over the past few years.

The wildcard is autonomy, because true autonomy will see the share price double or triple within a month or two

 

[Knightshade]

It's not the market share that gets regulated - it's the abuse of that monopoly power that is regulated.

Which, as the FTC points out- generally requires a majority market share.


Again if you can cite any examples of a company with only 1/4 of the the share of the market having succesful anti-trust action taken against them I'd be happy to see it.

But you seem to be trying to defend an inaccurate point otherwise.

A basic tenant of anti-trust law is that regulated behavior must be harmful to consumers. If the monopoly is due to innovation that allows the company to offer superior products at superior prices and the company is not using that monopoly power in an unfair manner to prevent others from competing, there is no legal ability (or justification) to break it up.

The definition of monopoly is useful but is only one test that must be passed before anti-trust law can be used against a company. A monopoly, in and of itself, is not illegal.

I never said it was.

I said that a company with only 25% market share would not have concerns about anti-monopoly laws in the first place because it doesn't have enough market share before even considering the other factors you mention

I then provided a source from the FTC that appears to confirm this is correct.

So I'm not sure why you keep insisting market share does not matter- it does. Below a certain point you don't have to worry about ant-trust issues.

If you're ABOVE that share (which Tesla is not in the examples discussed) then you MIGHT have concerns if you ALSO do other specific things that may violate the law.

 

[Chocochip]

10Q drops on Monday morning.
Short shorts start shipping out on Tuesday.
How is this not a bullish sign for S&P inclusion? It's almost like Tesla is making it so obvious now that people are not ready to believe it. I think it's happening this week and I'm buying a few options based on this read. YMMV

“Oh, look, Elon tweeted about SPoon, get ready everyone!”
Sometimes a delivery update on an item that was sold out as soon as it was added to the store (and was added before the manufacturing company making said item actually started making them in large volume) is just that. Consider the possibility of no hidden meaning!
I’d rather be pleasantly surprised than expect something and be disappointed.
Of course, a certain web page will still be furiously refreshed at about 1 h and 15 min after market close today.

 

[Nocturnal]

10Q drops on Monday morning.
Short shorts start shipping out on Tuesday.
How is this not a bullish sign for S&P inclusion? It's almost like Tesla is making it so obvious now that people are not ready to believe it. I think it's happening this week and I'm buying a few options based on this read. YMMV

Shhh. Don't say it or it won't ever happen.