Disagree. All things considered, he learned the right lesson. It's the only one that NEEDS to be learned. Most everyone has to learn for themselves that this is true, sometimes painfully.
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Artful Dodger
"Neko no me"
Not just MMs affecting the SP right now: tomorrow's Close is the S&P 500 "Reference Date" for the March quarterly rebalancing:
https://www.spglobal.com/spdji/en/documents/methodologies/methodology-sp-us-indices.pdf
TSLA had a SP of $695.00 at the S&P inclusion on Dec 18, 2020. If TSLA varies substantially from that, and more specifically, substantially differing vs relative change of other S&P 500 components, then large index funds will adjust their stock holdings accordingly.
I'm just glad 420 isn't in play...
Cheers!
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StealthP3D
Well-Known Member
I've reconsidered my previous belief that most of the legacy automakers will go bankrupt. A very rough patch to be sure. But they don't need to outrun TESLA merely to survive, they only need to make more desirable EV's compared to ICE vehicles and be able to do it at a profit (eventually). It's like the old joke that you don't need to outrun the bear to survive, you just need to outrun your slowest companion. The funding to get them through this difficult time could be investor's (given their current willingness to invest in anything EV) and/or governments, the source of funding depending upon the level of capital liquidity in private markets. Of course, if the overall economy doesn't stay healthy this won't work.
Previously, I had assumed investors would not step up to the plate to bail out incumbents with poor financials but that might not be the case if the incumbents can successfully position their capital raises as an investment in the electric future.
The cast alloy under-structure, exoskeleton (no expensive paint), improved wiring (maybe), efficient data processing and cheaper structural batteries will likely result in a lighter (million mile) vehicle that is easier and faster to manufacture. If the cast alloy/exoskeleton combo delivers on its promise, it will be immensely popular and deliverable in large numbers. Add in FSD and demand will stay beyond battery production for quite a time IMO.
So there is no way to cancel out short term cap gain of say, 25k by taking 25k loss somehow? I’ll be paying tax on 25k regardless of what stock does in future? If price goes up to getting my money back, I’ll still owe tax on 25k. See my situation? I was just thinking of using share selector on schwab and selling the really high price shares to get my average down. I already goofed once and have 10 shares with higher cost basis due to one wash sale, so I don’t want to sell those because I think I lose the benefit of that adjustment. Does my scenario make sense? Load up a months worth of buying shares now, then sell shares of the higher price lot to take the loss to cancel out previous short term cap gain of 25k. After 30 days, reinvest the sold high price share proceeds? Smart yes? Or dumb ? Or both? Not seeking advice just opinions
Paying taxes isn’t the end of the world. Better that than make a bad trade. If you have other stock you want to sell at a loss, then you can offset the cap gains. Maybe sell some other laggard, and buy something else that you like better.
StealthP3D
Well-Known Member
You need to consider that VW's EV's are not competing with Tesla, they only need to better than 95% of the market that is ICE. Once you have price parity, that's a very low bar indeed.
TheTalkingMule
Distributed Energy Enthusiast
It would be helpful to flip back a few years and see how Germany handled the disruption of their energy grids by solar/wind electricity supply crossing a critical threshold and squashing utilities. Covered extensively in the Energy/Environment/Policy forum.
All three major electric utilities instantly went bankrupt as solar crossed about 4% of total supply. Solar ate away peak demand by supplying up to 50% of peak demand and ruined the profit schemes of all other energy producers. The only reason it hasn't happened in the US is corruption. Here we value corporate profits of supposedly "public utilities" far above the needs of consumers, in Germany it is often the opposite.
Not only did the German gov't force each of the utilities into bankruptcy rather than bail them out or change the rules, they also wouldn't let them split off their worst assets into separate entities. They forced entire enterprises to go through bankruptcy for 2-3 years and come out the other end as proper grid services providers and only then did they let them separate into production units and grid management units.
This I think is why we're not likely to see any desperation from the major German car manufacturers. It will be painful to fall so far behind and go through bankruptcy, but the DE gov't(on behalf of the autoworkers) won't let these entities die off. If I had to guess.....most will remain resistant to change, then spend a year or two in bankruptcy, before emerging as varyingly successful EV companies probably worth far less than today.
We in the US rightfully see GM as a walking corpse. They simply have no avenue to success. They will get bailed out by the US gov't, but not in any way that creates a more sustainable business model or forces them to service the demands of the marketplace. God forbid.
TheTalkingMule
Distributed Energy Enthusiast
It's so obvious what they need to do, and astounding it wasn't the clear decision coming out of Dieselgate. They need to make the next "people's car". A $20k non-autonomous EV with 240 miles of range. A reimagination of the Beetle. They'd sell like liters of pilsner.
Perhaps there is much more truth to this than I ever would have thought. It's still worth trying a little to drag things out to over 366 days for US long term capital gains purposes.
And yes, most of my TSLA is in my Roth.
Some talk that Semi production starts in early Q2 along with deliveries actually happening by end of Q2. Would be a big surprise since most analysts are projecting Q4.
What if instead of selling retail EV products in a difficult competitive market , they made the leap directly to Transportation as a Service (TAAS). This avoids competition with their legacy ICE products on the showroom floor and they can transition their dealer network as support services for their EV TAAS fleet.
If your going to make a leap, go big!
If they could do this it would obliterate/Osborne their ICE business, leaving them with a bloated workforce that they cannot downsize and untold billions in stranded assets. This is the dilemma the traditional OEMs face, whether they recognize it or not.
lafrisbee
Active Member
Thank you. That's when I bought my first TSLA shares. Your shares.
Correction: Those shares.
Correction: Don't worry. My shares are being well kept.
StealthP3D
Well-Known Member
I don't see it that way. It's much better to learn from the entire body of evidence vs. one's painful experiences. The fact that a painful experience tends to drive a learning home in a very effective manner does not change this because the learning might not be a valid one just because it turned out that way one time.
Investors have a tendency to put more weight on learning events that have large impacts on their own finances but, from a first principles perspective, this is not wise. Considering all the evidence equally will result in better performance than weighing personal experiences disproportionally.
That said, I do think the conclusion that tax considerations tend to be given too much weight is true. Tax consequences do need to be considered but they shouldn't be given more weight than they deserve. The reason investors tend to break this rule is because the tax consequences of a decision tends to be very visible (and sometimes a certainty) while the result of an investment decision tend to be unknowable until some time has passed. This leads investors to put too much weight on the tax considerations. It's often better to make the investment and pay the taxes. It really depends upon the level of conviction. This is where investors tend to over-estimate their ability in the short-term. Short-term price movements are largely unknowable (at least with a high level of certainty) and so tax considerations should rightly prevail. But longer-term decisions need to give less weight to the tax considerations.
Summed up and generalized, a trader should trade, taxes be damned, and a an investor should hold. Because holding automatically minimizes taxes. Taken to the final conclusion: Don't trade, hold!
TheTalkingMule
Distributed Energy Enthusiast
That's right, I always forget you can't just pivot since the workforce requirement is about half. They already have twice as many people as needed in these German plants, just make it 4x!
Pezpunk
Active Member
using Tourette's as a pejorative like that demeans a lot of people with a legitimate medical condition. Gordon isn't sick, he's merely human garbage.
That can't be true, can it? I mean there's no way Austin could start producing MY's by the end of Q2 2021, is there?
StealthP3D
Well-Known Member
I don't invest capital that I'm not planning on leaving invested for years. That said, if I make a mistake, if the picture changes, I will sell instantly, capital gains taxes be damned. Traders will trade and a few will beat me. Most will not.
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