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

[AlanSubie4Life]

Seems like a good plan. I am pretty sure my highway numbers in the spreadsheet for the Model Y will be close to the actual value from the test. Has to be!

In any case, Model Y looks like it will (predictably) have much worse range than Model 3 on the highway, under best case conditions at least (it is still fine though). I would guess long term they’ll want to cram more battery in there if they can.

@Words of HABIT any particular reason for disagreement with this?

Definitely will see what sort of numbers I can pull out of the detailed certificates that @bhtooefr has pointed out to see if I can track the efficiencies on these other cycles.

But the fact remains that the raw HWFET is a very decent (optimistic) predictor of best-case Highway range. And comparing that result to Model 3 should be safe. And it clearly (no surprise!) is a lot worse than Model 3.

@SageBrush yes I think that squared coefficient isn’t bad as a model of relative aero loads. When calculating to get predicted Wh/mi impact, though, you have to make some assumptions about drivetrain efficiency; it can’t be used directly. So you can’t necessarily use it to compare the efficiency of two different vehicles at highway speed, if the drivetrains are different. I’ve never tried to piece this all together though. I just have my own empirical physical model, which is good enough for who it is for.

I guess I have to ask the same of @StealthP3D. What is there to disagree with? I mean, the range of the Model Y will be fine, but on the highway it is likely going to get about 10-15% less range than a Model 3. So rather than 225-250 miles at 70-80mph between charges under optimal conditions, it’ll likely get around 200 miles. Which is fine, but not optimal! So I could see there being a long-term effort to get better battery energy density to make it awesome for road trips.

 

[StealthP3D]

Yes, it was manipulation. From Tue-Thu, FINRA reported there were 2,136,450 shares sold marked as "ShortExempt", which means they were not located before being sold.

This would be illegal naked short selling except for the Market Makers Exemption (the "Madoff Rule"), which allows MMs to artificially (and without limit) increase the float even during times of high volume (when there is plenty of liquidity). This is an abuse of the exemption, which was intended to 'provide liquidity' but is now being used by unscrupulous parties to crash the SP while they scoop huge profits.

On Wed-Thu this week (in the middle of this bear raid), FINRA reported "ShortExempt" sales reached 9% of total shares sold short: (during a period of huge trading volume when liquidity is NOT AN ISSUE).

View attachment 509185

This had the effect of killing the sustained rally of Tue afternoon, and causing widespread panic selling amongst real shareholders (sorry @Right_Said_Fred this is the illegal practice you got swept up in).

View attachment 509189

This is market manipulation, pure and simple. Your hand waving attempt to explain it away does not change the reality, nor deal with the underlying problem: Regulation SHO (see below).

Let's see if these anonymous MMs can locate all these naked short shares before they are legally required to report their activity in the Failure to Deliver (FTD) report after 13 days. If these MMs are able to locate shares post hoc, it simply means legitimate investors were duped into selling their shares by the panic created by the dumping of millions of non-existant shares. If they can't locate shares, there are no consequences, and the actors involved remain anonymous.

Tell me again how this isn't manipulation? Where is the SEC?

Paging @UncaNed @Hock1
Info: @Fact Checking @KarenRei @lklundin

More here about the Market Maker's Exemption (Regulation SHO):
Regulation SHO | FINRA.org
Key Points About Regulation SHO

A final note: FINRA-reported volume is just a fraction of total trading on NASDAQ. During this week for example, FINRA reported a total volume of just 94,702,898 (94.70M) shares, while we know that total NASDAQ volume was 208,823,482 (208.8M) during that time (FINRA only reports numbers for Pre-Market and the Main Session, does not include the After-Market Session).

We have ZERO visibility into how much the rest of NASDAQ trading is sold short, or conducted under the short selling exemption. We do know that last week, we have no short selling information on 54.65% of all TSLA trades done on NASDAQ.

Think about what that means for Investor confidence and the transparency of the Market.

That's an excellent learning on how markets are manipulated. But I have mixed feelings on how it impacted Tesla. Let me explain.

First of all, I dumped all my call options on Wednesday. They lost half (or more) of their value from Tuesday's peak (but were still up around 20-30X). So this manipulation was a HUGE loss of profit potential for me. I could buy the late Feb. 2020's back for less right now but I don't want to. Market makers cut potential losses in half or more, a huge savings for the bastards.

But, for those TSLA investors who are only long TSLA, this is making a "prettier" long-term chart with less volatility than it would have had if there was no manipulation using the "Madoff" rule. The run past $900 was largely based on the underwriters of the options needing shares to hedge their losses. So it probably would have run to $1100 (or higher) before crashing back down. That does not make a "pretty" chart.

In the long-term, the manipulations now do not impact the value of the shares down the road. They will settle into a valuation based upon projected growth rates, margins and potential size of the market. So while I hate the manipulations and believe in transparent markets, it mostly impacts the short term. It's greedy people manipulating for their own benefit. But I like that it's smoothing out the price action. The fact that options underwriters mispriced the options and found themselves in a bind can disrupt the normal functioning of markets. Ideally, they wouldn't misprice the options to begin with (but then our profit potential would be much less). The options markets introduce price volatility in the underlying shares that otherwise wouldn't be there. This manipulation was the "solution" to that. I'm not saying it was a good or proper solution, just that it did solve their problem (which wouldn't have existed if they didn't misprice the options to begin with). They should have had to pay the price for their mispricing. What this illustrates is those playing the game at the highest levels, the market makers, actually don't know what they are doing. But that they can hack together a corrupt solution to "fix" their gross negligence.

All I'm saying is the manipulations reduced the impact of the options mispricing on the underlying shares which is actually a net positive for those only long TSLA (for the long-term). And, what a "pretty" chart it's shaping up to be!

 

[Rotte]

Anyone else anxious that Elon has started to tweet a whole lot more random stuff recently?

 

[MP3Mike]

But people who only know enough to be dangerous to themselves constantly repeat that Tesla doesn't have a lead in batteries because they simply purchase their batteries from others.

Maybe you are forgetting that while Tesla "simply" purchases the cells from others, they are made to Tesla specs, including the formulation of the cathode, anode, and electrolyte in addition to the physical construction. What Tesla isn't, or wasn't, an expert in was the actual manufacturing of cells. (But they may have acquired that between Hibar and Maxwell.)

They aren't buying off the shelf cells. (At least not from Panasonic.)

 

[Creekstalker]

Cathie Wood on Tesla’s meteoric rise: ‘We’ve been waiting for this’

I feel as though Cathie Wood’s presentation is getting better and better. Like a Tesla it just gets better and better.

Thanks for the link and Cathie is indeed looking smarter by the day (to THEM, not US- we've long known).

On another OT note re: your avatar picture. If that is actually you, is there any chance I can tag along on your next overland expedition to the North Pole?

 

[StealthP3D]

I guess I have to ask the same of @StealthP3D. What is there to disagree with? I mean, the range of the Model Y will be fine, but on the highway it is likely going to get about 10-15% less range than a Model 3. So rather than 225-250 miles at 70-80mph between charges under optimal conditions, it’ll likely get around 200 miles. Which is fine, but not optimal! So I could see there being a long-term effort to get better battery energy density to make it awesome for road trips.

There are two parts of your previous statement I disagree with.

In any case, Model Y looks like it will (predictably) have much worse range than Model 3 on the highway, under best case conditions at least (it is still fine though). I would guess long term they’ll want to cram more battery in there if they can.

The HWY range test is close to the best case conditions. The average speeds are relatively slow when I last checked, not the 70-80 mph that exists on many of the nation's highways. I agree that at higher speeds the Model Y will likely take a decent range hit vs. the Model 3. But I do think Tesla's relentless march of constant improvement has introduced some new efficiencies that will take up a portion of the hit. So, at slower HWY speeds of 60-65 mph, I bet the actual range is very close, if not identical, to an AWD Model 3.

What I was really disagreeing with was that Tesla would want to cram more batteries in there. With fast V3 charging and a higher density of Supercharger sites, it's not necessary to have over 300 miles range for awesome road trips. The Model 3 already charges faster than I can take a break after driving continuously for hours. And that's on V2 SC'ers. More batteries make the car heavier and more expensive, neither of which make the car better.

That said, I love extra long ranges, mostly because I live and travel in areas in which the Supercharger network has not been built out to the secondary and tertiary routes. I'm looking forward to the 500+ mile range of the Cybertruck! But I don't think they should cram extra batteries in the Y because most people don't want to pay for that kind of range. An SUV is not designed for long, high-speed trips anyway. When traveling the backroads with their slower speeds of 50-55 mph, the Model Y will likely get the same range as the AWD Model 3.

 

[StealthP3D]

Maybe you are forgetting that while Tesla "simply" purchases the cells from others, they are made to Tesla specs, including the formulation of the cathode, anode, and electrolyte in addition to the physical construction. What Tesla isn't, or wasn't, an expert in was the actual manufacturing of cells. (But they may have acquired that between Hibar and Maxwell.)

They aren't buying off the shelf cells. (At least not from Panasonic.)

I get that but Tesla's biggest advantage in batteries in not at the cell level, it's at the pack level and the software. Some of this is a cost advantage and some of it is better technology. And yes, the cells are better too!

 

[Fact Checking]

Yes, totally agree. In my ignorance I didn't know who Jim Keller was prior to watching this, but I looked him up afterwards. It seems he's a bit of a rock-star when it comes to chip architecture/design. That someone who is held in such high esteem thinks so highly of Elon and the Tesla approach makes it even more profound.

Jim Keller is more than a rock star of chip design, AFAIK he designed the AMD64 architecture, which was the David against Intel's Goliath, and they won - Intel had to abandon its 64-bit design and is using AMD's 64-bit design today.

And Jim Keller was thinking outside the box there: Intel's 64-bit chip was a first principles redesign from scratch, but x86-64 was designed to be very easy to migrate to, where the 64-bit instructions are extensions and can coexist with 32-bit instructions, without compromising 64-bit performance.

This allowed AMD to build chips that had excellent 32-bit and 64-bit performance as well - while Intel's 64-bit chips emulated 32-bit instructions.

Jim Keller, somewhat ironically, is working for Intel currently.

 

[ABCTG]

Something I haven't seen much discussion about here is inclusion of TSLA into the Russell 1000 index.

For example in Vanguards Russell 1000 index fund

VRNIX


TSLA has $7.9 million (now $14m) , ranking at about number 100 in dollar amount.

The top 30 range from $173 million down to $22 million

Vanguard Mutual Fund Profile | Vanguard


A passive index investor may be eager to see a transition to renewable transportation, but then disappointed to see such a meager proportion of TSLA holdings in the passive index fund.

Will any of the Russell 1000 index funds add more TSLA to their holdings?


*edited to change the dollar amount of TSLA to $14million at todays price, since the prices Vanguard shows are of DEC 31st 2019

 

[hobbes]

According to one of the local twitter accounts, on Monday (Feb 10) the first harvesters for cutting the trees for GF 4 Berlin are scheduled to arrive at the site. However, they don´t yet have the go from bomb clearing team. I don´t know if this implies that the animal protection issues have been resolved.

Also, they have started deploying an electrical connection for the factory and a glas fibre cable for data (see other pictures in the twitter feed).

@GF4Tesla..️️.build #GigaBerlin. on Twitter

On the same feed there is now also news about animal housings that need to be moved .

- 2 trees with bats
- 4 ant hills
- 16 bird nests (9 large, 7 small)

Should be managable . Will be resettled to nearby areas.

That´s Germany .

 

[Artful Dodger]

Following the link to the Key Points About Regulation SHO I found the following two sections relevant - emphasis is mine:

The sale could be marked “short exempt” if the seller is entitled to rely on an exception from the short sale price test circuit breaker.​

And the exempt volume is so high on Wednesday and Thursday as they use it to go around the circuit breaker rules which were in effect those two days! So in effect the uptick rule does not apply to them either.

Thank you for pointing out this important aspect of Regulation SHO. It explains how Market Makers (MMs) were able to drive the SP down over $120 on Wed/Thu even with the "uptick rule" in effect. This drop is unprecedented in trading history for TSLA, and occurred when investors were supposed to be protected by the SEC "uptick rule". Instead, MMs exploited their priviledged position in the Market to defraud investors.

Tue/Thu was not "Bona fide market making"; instead it was a bear raid conducted by the actual Market Makers. Neither was this "providing liquidity for a low volume stock" when few sellers were available. There were lots of sellers at $965 SP. No, this was actual FWAUD conducted by the MMs.

It remains to be seen what Securities Investigators in Germany will do about the Pre-Market price manipulations at one of the two German stock exchanges (Xetra). Paging @Fact Checking if you know more.

It has happened before. In this example from May 2013, lawyers acting for Goldman accidentally released an unredacted document revealing compromising internal discussions regarding naked short selling:

"Now, however, through the magic of this unredacted document, the public will be able to see for itself what the banks’ attitudes are not just toward the "mythical" practice of naked short selling (hint: they volubly confess to the activity, in writing), but toward regulations and laws in general.

"Fcuk the compliance area – procedures, schmecedures," chirps Peter Melz, former president of Merrill Lynch Professional Clearing Corp. (a.k.a. Merrill Pro), when a subordinate worries about the company failing to comply with the rules governing short sales.​

Info: @Hock1 @UncaNed @Right_Said_Fred

It also confirms something that I discussed here on TMC last week: most retail shorts were squeezed out in heavy Pre-Market trading during the final week of January 2020, and now the only Shortzes left are in fact certain Market Makers who are also large investment bankers.

This is an ominous development for the likes of UBS, GoldmanSachs, and MorganStanley, and all other investment banks that qualify for the Market Maker's Short Selling exemption, and have suspiciously low price targets and a 'Sell' rating for TSLA.

The SEC must investigate now. This is a market-confidence shaking revelation.

Thank-you again for your insight. Investors appreciate your help.

Regards,
Lodger

 

[UnknownSoldier]

Jim Keller is more than a rock star of chip design, AFAIK he designed the AMD64 architecture, which was the David against Intel's Goliath, and they won - Intel had to abandon its 64-bit design and is using AMD's 64-bit design today.

And Jim Keller was thinking outside the box there: Intel's 64-bit chip was a first principles redesign from scratch, but x86-64 was designed to be very easy to migrate to, where the 64-bit instructions are extensions and can coexist with 32-bit instructions, without compromising 64-bit performance.

This allowed AMD to build chips that had excellent 32-bit and 64-bit performance as well - while Intel's 64-bit chips emulated 32-bit instructions.

Jim Keller, somewhat ironically, is working for Intel currently.

He also designed Apple's first in-house custom ARM SoC and put them on the path to dominance in ARM performance we see today.

It's not clear what he's doing for Intel, some people speculate he's trying to design the next generation x86 core for Intel at 7nm so they can finally get past this unending disaster of a transition from 14nm to 10nm which is what let AMD catch up in the first place.

Jim Keller is basically singlehandedly responsible for all the important innovations in semiconductors for the past 20 years. And hardly anyone has heard of the guy.

 

[Singuy]

Jim Keller is basically singlehandedly responsible for all the important innovations in semiconductors for the past 20 years. And hardly anyone has heard of the guy.

And the crazy thing is, that podcast with Rogan made Jim sound like he's peon compared to Elon. Perhaps he is just extremely humble, but man it seems like he feels that Elon can do his job but better in an afternoon worth of book reading or something.

 

[Silentk]

Mid-morning dip

MODS: Is there a way to have a facility to expand abbreviations if you hover over them or right-click? is there someone technical who could do that?

 

[Electroman]

Wow, that’s a profound discussion. Highly recommended.

For those that can't spend 25 minutes jump to approx 21:00:

Lex: When do you think autonomous driving will be solved? 1,2,3,4,5 10 years as opposed to a century?

Keller: yes definitely

Lex: Where is the confidence coming from?

Keller: It is a computational problem. Pretty solvable. {and he goes onto give an example of speech recognition}. Speech recognition for a long time people were doing with frequency and domain analysis and stuff, that didn't get them very far. And then they tried deep learning on that, and it worked great, and it took multiple iterations. Autonomous driving is way past the frequency analysis point.

Lex disagrees with that, as he thinks when you put humans into the picture, then it is no longer a 'ballistics' problem.

 

[Buckminster]

On the same feed there is now also news about animal housings that need to be moved .

- 2 trees with bats
- 4 ant hills
- 16 bird nests (9 large, 7 small)

Should be managable . Will be resettled to nearby areas.

That´s Germany .

You missed:

 

[Navin]

Anyone else anxious that Elon has started to tweet a whole lot more random stuff recently?

Yes. Anxious to buy shares in the premarket and MMD. RE: anxiety and Elon’s tweets - pls note that he liked this tweet earlier today. Sleep well, bud. FOMO is real!!!

 

[KarenRei]

You missed:
View attachment 509265

"And a partridge, une perdrix..."

 

[hobbes]

European January registrations are in (only missing Portugal which should be negligible) at about 10% below October 2019 (1939 vs. 2141). January 2019 was 760, but that was just before Model 3 deliveries started.

Tesla Europe Registration Stats

 

[Words of HABIT]

ARK Invest excepted; even so, they sold 38.43% of their TSLA holdings in 2019Q4. Their 'trim above 10%' activities still have me scratching my head.

Yeah I know, I know, @Curt Renz has tried to explain it to me, but I guess I'm just slow to sell a winner...

Cheers!

If ARK Invest's non-TSLA holdings on average take a dive, they would be forced under their fund principles to further reduce TSLA holdings so as not to exceed it capping 10% of the overall fund. (Not sure if this is what happened.)
Also not sure if ARK Invest sold above $900/sh, however with a 20% drop since the high, if they did sell then they should be buying back in now. Curt?