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

[bhtooefr]

Elon didn't plan to build a factory in China due to the force joint venture requirement. You think he would be OK for Chinese to take Tesla private?

At this point, I almost suspect that 100% Chinese ownership of Tesla - even if it means they lose control of IP - would be better for the mission than the current exposure to corrupt American regulators going off on a hair trigger.

 

[generalenthu]

I think Williams Connolly / Dane Butswinkas representing Elon / Tesla and shutting up SEC will be killing 2 birds with one stone. Dane is still fully inTesla's court, and putting SEC in its place.

 

[Fact Checking]

Answer is yes. Who watches the watchers. Congress insider trading is an open secret, yet nothing is done.

Insider trading by congressmen on secret information they receive is deeply unethical but actually legal:

Insider trading by members of Congress during financial crisis?​

SEC employees selling confidential, privileged information to short sellers on the other hand would not just be unethical, it's also a crime with several felony counts and possible prison sentences, plus disbarment both from the securities and legal professions, for life.

 

[Remus]

At this point, I almost suspect that 100% Chinese ownership of Tesla - even if it means they lose control of IP - would be better for the mission than the current exposure to corrupt American regulators going off on a hair trigger.

I agree. But how many of us? Does Elon agree?

 

[CorneliusXX]

• B) It wasn't guidance; it was a declarative statement.

There's about 10 posts from new accounts all using "declarative statement" in their response. This is so obviously from a script. There is no possible this rather specific term is being used so broadly by a bunch of armature sleuths by co-incidence.

 

[Bet TSLA]

Most of us here would be out. It was discussed fully after the ‘thinking about taking Tesla private’ tweet, so search back in last year’s investor’s thread.

Don't be silly. He's had six months of having top securities lawyers craft a suitable ownership vehicle that meets his requirements. Surely it's vetted, tested, and ready for deployment. That would be called planning.

 

[azaz]

the problem with the "this tweet didn't need to be reviewed because it was restating something" defense really doesn't work. Consider this from the settlement

"If an Authorized Executive (i) further edits a pre‐approved Written Communication, or (ii) desires to release a Written Communication more than two (2) days, after receipt of written pre‐approval, such Authorized Executive will re‐confirm the pre‐approval in writing in accordance with this Policy prior to release."

It doesn't have to be new material info that is considered eligible for review, its any material info that hasn't been approved within the last two days.

 

[Fact Checking]

It doesn't have to be new material info that is considered eligible for review, its any material info that hasn't been approved within the last two days.

I believe you are confused about a key definition:
all "material information" is new, non-public, market moving information.

It ceases to be "material information" the moment it's published.

So Elon tweeting already disclosed information is not material information and is not subject to the restrictions of the settlement.

 

[oneday]

the problem with the "this tweet didn't need to be reviewed because it was restating something" defense really doesn't work. Consider this from the settlement

"If an Authorized Executive (i) further edits a pre‐approved Written Communication, or (ii) desires to release a Written Communication more than two (2) days, after receipt of written pre‐approval, such Authorized Executive will re‐confirm the pre‐approval in writing in accordance with this Policy prior to release."

It doesn't have to be new material info that is considered eligible for review, its any material info that hasn't been approved within the last two days.

It wasn’t “material” info.

 

[printf42]

My best guess on the worst case result from this latest kerfuffle:

The judge asks the SEC what it wants. They respond, "A fine and a closing of Musk's twitter account." The judge agrees.

Then for marketing, Tesla will either have to start advertising, or Elon will have to start agreeing to media requests for more frequent interviews.

Guess I should buy some lotto puts of TWTR tomorrow.

 

[Causalien]

Insider trading by congressmen on secret information they receive is deeply unethical but actually legal:

Insider trading by members of Congress during financial crisis?​

SEC employees selling confidential, privileged information to short sellers on the other hand would not just be unethical, it's also a crime with several felony counts and possible prison sentences, plus disbarment both from the securities and legal professions, for life.

I know, usa legalized bribing.

The sec part. Who is going to enforce it? SEC?

I am just not very confident of the gov's ability to enforce law due to several recent events. All I am seeing is the bad guys getting away with it.

Maybe if I see bankers getting locked up in Iceland's style I'll vhange my mind. Even so, innoncent ppl still lost a lot even after the bad guys gets locked up.

 

[CorneliusXX]

My best guess on the worst case result from this latest kerfuffle:

The judge asks the SEC what it wants. They respond, "A fine and a closing of Musk's twitter account." The judge agrees.

Then for marketing, Tesla will either have to start advertising, or Elon will have to start agreeing to media requests for more frequent interviews.

or elon starts posting on Reddit

 

[printf42]

Where would he get the money? Hopefully not the Saudis.

Chinese, he will also get a green card and move there.
Did you see today’s AH close price? 288.00, I don’t need to point out the obsession of 8 by Chinese businesses people do I?

 

[Chunky Jr.]

It's really sad, and pathetic, that a successful American company that has created 10,000's of jobs in the US is being hounded on all sides by greedy charlatans and hacks working on behalf of fossil fuels interests and ideology.

 

[Papafox]

Here's the words from the 4Q 18 Conference Call where the 350k-500k number up:


Colin Rusch

Thanks so much. Can you talk a little bit about the geographic dispersion for the guidance for 2019, where you're expecting the Model 3s to sell through as well as the other models?

Elon Musk

Well, I think we did, actually. Yes, it's clear in our letter.

Deepak Ahuja

We indicated in Q1, we will start delivering Model 3s in Europe and China. And we also shared a chart showing the potential market size for midsized premium sedans in North America, Europe and Asia, suggesting those markets could be even bigger. So I think that gives a good sense of where we'll be. And we'll launch the right-hand drive version at some point to go to the other markets.

Elon Musk

Yes. Maybe in the order of 350,000 to 500,000 Model 3s, something like that this year.

 

[Artful Dodger]

It's really sad, and pathetic, that a successful American company that has created 10,000's of jobs in the US is being hounded on all sides by greedy charlatans and hacks working on behalf of fossil fuels interests and ideology.

Even worse, last year's share ownership fillings shows that a great proportion of Tesla is now owned by large institutions, and less by retail investors.

I think that's the REAL squeeze being perpetrated here.

 

[Fact Checking]

The sec part. Who is going to enforce it? SEC?

The SEC has no criminal powers, it's a civil agency - so they definitely don't get to enforce it.

If there's evidence of crimes then I'm sure there's plenty of ambitious prosecutors willing to take it up. Corruption case, RICO, what's not to like?

Takes only a single whistleblower - and future administrations might also find evidence of past crimes - the statute of limitations runs long.

 

[sundaymorning]

Exactly. Also note that the SEC is a U.S. government agency, and the SEC's overzealous interpretation of the settlement effectively applies prior restraint to Elon's protected speech.

Which is what the U.S. government must not do, according to the First Amendment of the U.S. Constitution.

Federal courts generally take a very dim view of prior restraint of speech - the SEC even lost such a case in the past, where a convicted felon prevailed against the SEC:

Lowe v. Securities and Exchange Commission

"In Lowe v. Securities and Exchange Commission, 472 U.S. 181 (1985), the Supreme Court further emphasized the strong presumption against prior restraint under the free press provision of the First Amendment [...]"​

I have no idea why the SEC thinks they have a case here: the settlement with Tesla and Elon didn't involve admittance of guilt, and Tesla and Elon only settled under extreme duress of a SEC civil case and the possible outcome of Elon's removal as CEO hanging over their heads for years. There's no conviction and no limitation on the legal arguments Elon/Tesla can make against the SEC's interpretation.

A contempt hearing is a much safer and much faster to adjudicate forum for Tesla and Elon to litigate the fairness and First Amendment aspects of the SEC's position, IMHO.

If your long Tesla, if you’ve ever been bullied, if you were ever harassed, if you’ve been wrongfully accused, then bring this fight to the SEC and make them feel some heat by posting Your opinion on any public forum (yahoo, msn, CNBC) you can get your hands on to support Elon & Company. Public pressure will essentially bring internal pressure, these SEC jokers need to feel our wrath.

I’ll be posting as much as I can elsewhere to garner support for Tesla and Elon.

 

[Papafox]

The SEC is going after Elon saying that his tweet was "inaccurate", because he corrected that tweet with a different number. Actually, if you look at Elon's two tweets on Feb 19, the first 500K tweet was talking about production in 2019 and in his second tweet, after clarifying the 500K production rate at end of 2019 he said deliveries at 400K.

It's entirely possible that, rounded to the nearest 100k, 2019 deliveries will be 400K and production and production anualized rate at year end for 2019 may be closer to 500K. Thus, the difference between 400K and 500K is not "inaccurate" because one is talking about deliveries and the other production. The SEC was sloppy here in claiming Elon was "inaccurate".

 

[CuriousSunbird]

No

The SEC is going after Elon saying that his tweet was "inaccurate", because he corrected that tweet with a different number. Actually, if you look at Elon's two tweets on Feb 19, the first 500K tweet was talking about production in 2019 and in his second tweet, after clarifying the 500K production rate at end of 2019 he said deliveries at 400K.

It's entirely possible that, rounded to the nearest 100k, 2019 deliveries will be 400K and production and production anualized rate at year end for 2019 may be closer to 500K. Thus, the difference between 400K and 500K is not "inaccurate" because one is talking about deliveries and the other production. The SEC was sloppy here in claiming Elon was "inaccurate".

No doubt the judge will grant the SEC’s request and so we will then get to see Elon’s own full explanation.