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

[Singuy]

Human psychology dictates that if Musk says "over 11b" this year than it's going to be slightly over 11b. If it's 11.8b then he would say "almost 12b". These are defensive statements so normally people likes to overstate these defensive statements and pad it with almost misleading trickery to make it sound more than it is (like I would include all my sales tax paid/property tax for the year trying to make my points).

So there's little chance people states almost 11b but ends up paying over 13b in these type of statements.

 

[CHGolferJim]

I think you're right, here is Dave Lee's math. He computed $13.3B in taxes if Elon continued with the additional share exercise/sales over the next couple of weeks.
So an $11B number may suggest he is done:

https://twitter.com/x/status/1472435384063823874

Do you think Elon is prevented from simply saying he’s done by insider trading or other rules, and this is the most definite indication we’ll get?

 

[JRP3]

In the end it's impossible to say how educated the current participants in TSLA share trading really are which makes it difficult to guess the impact. My best guess is it's a wash and won't move the stock too much one way or the other.

Short term I can see it plus Omicron push us under $900. Or not.

 

[StarFoxisDown!]

Human psychology dictates that if Musk says "over 11b" this year than it's going to be slightly over 11b. If it's 11.8b then he would say "almost 12b". These are defensive statements so normally people likes to overstate these defensive statements and pad it with almost misleading trickery to make it sound more than it is (like I would include all my sales tax paid/property tax for the year trying to make my points).

So there's little chance people states almost 11b but ends up paying over 13b in these type of statements.

Exactly. Over 11 billion most likely means something like 11.1 billion or even 11.02 billon. I also do not think he would put a number on it unless he was done with the selling.

I guess we’ll see after today. If he was planning on selling more it would have to be today. No one in their right mind would schedule sells the day or two before Christmas break

 

[SOULPEDL]

Not selling. Nada. Zip, Zilch.
Still own the same amount of the company. Nothing has change long term, or short term IMO.

 

[mars_or_bust]

Where is everyone?

Searching for speckled bats and digging for spare water in the neighboring woods.

 

[winfield100]

A stray thought on investing and HFT, high frequency traders, and the 52 Starlink satelites just launched version 1.5, laser sat to sat
they are in a LEO shell and are using laser for high bandwith AND high speed ground to sat to ground AND ground to sat to sat to ground

fiber optic is 31% slower, so sat comm 1/2 way around the world could possibly outrun ground fiber optic in terms of HFT or possibly shorter distances
what are the latencies and is sat to sat really faster than cables

I expect others have given a lot of thought to this

 

[jbcarioca]

It's not hard to make a nice luxury EV...

I liked your post despite this glaring mistake. I have driven nearly all of them. I own one of those 'alternatives'. Even the best of them miss really obvious flaws as EV's. Almost all of the obvious flaws are ones made by assuming an EV is just a de-ICED ICE. The gigantic common flaw is most often aerodynamics, but is also huge numbers fo excess parts that end out weighing and confusing. It is very hard to make "a nice luxury EV" when the OEM in question does not know what the word "efficiency" actually means.
From Jaguar, Audi, VW, Volvo, Mercedes Benz to BYD, Chery, JAC, Hyundai, Peugeot and Kia I have tested them all plus a few others. Some are very nice indeed. Some even mimic OTA updates. Some are fine...if you keep Tesla out of it. Clearly my Volvo exists only because Tesla is not yet sold officially in Brazil. The day they reopen, my longstanding Model 3 order will be fulfilled, unless there si some other Tesla I prefer then.
No matter the price or positioning de-ICING will not work well and no OEM has yet managed the transition, not even BYD.

 

[SmokyPeat]

A stray thought on investing and HFT, high frequency traders, and the 52 Starlink satelites just launched version 1.5, laser sat to sat
they are in a LEO shell and are using laser for high bandwith AND high speed ground to sat to ground AND ground to sat to sat to ground

fiber optic is 31% slower, so sat comm 1/2 way around the world could possibly outrun ground fiber optic in terms of HFT or possibly shorter distances
what are the latencies and is sat to sat really faster than cables

I expect others have given a lot of thought to this

Starlink could help level the playing field for many day traders, but the biggest HFT players tend to have fiber connections as close as possible to the exchanges. Like right across the street, often times. I could see a lot of them having Starlink as a backup system though.

 

[mongo]

A stray thought on investing and HFT, high frequency traders, and the 52 Starlink satelites just launched version 1.5, laser sat to sat
they are in a LEO shell and are using laser for high bandwith AND high speed ground to sat to ground AND ground to sat to sat to ground

fiber optic is 31% slower, so sat comm 1/2 way around the world could possibly outrun ground fiber optic in terms of HFT or possibly shorter distances
what are the latencies and is sat to sat really faster than cables

I expect others have given a lot of thought to this

HFT get server space next door (or same door) to the exchanges.
Understanding High-Frequency Trading Terminology

Co-Location​

Locating computers owned by HFT firms and proprietary traders in the same premises where an exchange’s computer servers are housed. This enables HFT firms to access stock prices a split second before the rest of the investing public. Co-location has become a lucrative business for exchanges, which charge HFT firms millions of dollars for the privilege of “low latency access.”




As Michael Lewis explains in his book Flash Boys, the huge demand for co-location is a major reason why some stock exchanges have expanded their data centers substantially. While the old New York Stock Exchange building occupied 46,000 square feet, the NYSE data center in Mahwah, New Jersey, is almost nine times larger, at 400,000 square feet.1

In some cases, the same length of cable is used to give all servers the same latency.
Relatedly: Putting The Brakes On High-Frequency Trading With Physics

 

[CorneliusXX]

Guoxuan, a Chinese LFP cell manufacturer signed an agreement to provide 200GWh of cells between 2023-28 to a US auto manufacturer, and to build a factory in the US. Presumably Tesla would be the only possible candidate for an order that large of LFP cells? Keen to know what others think.

https://twitter.com/x/status/1472748648706424833

 

[TheWalkingDad]

Guoxuan, a Chinese LFP cell manufacturer signed an agreement to provide 200GWh of cells between 2023-28 to a US auto manufacturer, and to build a factory in the US. Presumably Tesla would be the only possible candidate for an order that large of LFP cells? Keen to know what others think.

https://twitter.com/x/status/1472748648706424833

Doesn't VW have a 20% stake in the company? Could be VW.

 

[Sofie]

Human psychology dictates that if Musk says "over 11b" this year than it's going to be slightly over 11b. If it's 11.8b then he would say "almost 12b". These are defensive statements so normally people likes to overstate these defensive statements and pad it with almost misleading trickery to make it sound more than it is (like I would include all my sales tax paid/property tax for the year trying to make my points).

So there's little chance people states almost 11b but ends up paying over 13b in these type of statements.

So you’re thinking it’s done now?

 

[Singuy]

So you’re thinking it’s done now?

Depends on what you all are calculating. I have seen over 11b and under 11b as of now from multiple people. If it's over then they are done, if it's under then 1 tranch to go.

 

[mongo]

Guoxuan, a Chinese LFP cell manufacturer signed an agreement to provide 200GWh of cells between 2023-28 to a US auto manufacturer, and to build a factory in the US. Presumably Tesla would be the only possible candidate for an order that large of LFP cells? Keen to know what others think.

https://twitter.com/x/status/1472748648706424833

Could be other OEMs, it's not that much production...
Call 2023-3028 5 years.
GM's Hummer EV is 200kWh, if the pickup is similar:
200GWh/5years/200kWh = 200k vehicles per year
200GWh/5/100kWh = 400k vehicles per year, 2 million total.
GM's total truck sales are around 800k currently, as are Ford's. <25% conversion with large packs would soak those all up.

 

[JRP3]

Could be other OEMs, it's not that much production...
Call 2023-3028 5 years.
GM's Hummer EV is 200kWh, if the pickup is similar:
200GWh/5years/200kWh = 200k vehicles per year
200GWh/5/100kWh = 400k vehicles per year, 2 million total.
GM's total truck sales are around 800k currently, as are Ford's. <25% conversion with large packs would soak those all up.

I can't imagine using LFP cells for the largest packs.

 

[Knightshade]

Gary is doing it wrong. He's only calculating taxes owed on the discretionary stock sales. The 10b5-1 sales incur taxes too.

IRS doesn't care if the sale is discretionary or 10b5-1.

Gary includes the tax bill on ALL the options exercised:

1/ Options exercise: 17.114M x ($1,047 - $6.24) x 53% = $9.44B

That's all options exercised so far, regardless of 10b5-1 or not.


Then he includes another chunk of tax owed for the non-options shares sold in the second line.

2/ Stock sales: 5.428M x ($1,060 - $5 est) x 23.8% CG = $1.36B

 

[MP3Mike]

So 52.65% tax on 10,275,001 acquired shares (934,091 x 11)

No, he has to pay the tax on all of the shares acquired from his executed options. (And the cost basis is ~$6/share.)

 

[dl003]

IRS doesn't care if the sale is discretionary or 10b5-1.

Gary includes the tax bill on ALL the options exercised:



That's all options exercised so far, regardless of 10b5-1 or not.


Then he includes another chunk of tax owed for the non-options shares sold in the second line.

He didn't sell just $5B worth of stock though. He sold more than $13B. What a lot of people are missing is that he is basically getting double taxed: long term capital gain tax (1) (~20%) on the 10b5-1 shares he sells to get the cash + income tax (2) (~50%) on the new shares acquired through exercising options with the cash from step 1.

On the $5B discretionary sales he's only getting taxed on long term capital gain tax (~20%).

There might be a 3.8% surcharge on top of these but he shouldn't have to pay any FICA (15.3% for the self-employed or 7.65% for employees earning ordinary wages).

 

[SageBrush]

In some cases, the same length of cable is used to give all servers the same latency.

Interesting.
If enough money is involved, I suppose SpaceX could be paid to make a celestial wall-street.