TSLA Market Action: 2018 Investor Roundtable

[Causalien]

In my liberal micro bubble, the NYT is the Bible. So it’s taken me a long time to reach your conclusion.

It’s also personally mind blowing to find myself anywhere near Trump’s portrayal of the mainstream media as Fake News. If my friends knew about that heretical line of thinking, I would be permanently voted off the island.

That is very interesting. I'd expect left wing is more associated with the democrats and liberal minded people. Those that generally comes from the counter culture and shunning large media outlets. It is the conservative and Trumpians that should align more with large news media companies.

Have the two switched their roles?

 

[Causalien]

Just a note on this, which could be nothing or could be something, that I will try to follow up next week: while working last Thursday I got a call on my cell phone from a number I didn't have stored. I wasn't able to answer then and there so the call went unanswered. I tried calling back but no answer. This weekend I checked in the directory who the number was listed with, it was a person I don't know who is. I looked up where she lives and got a hit on an adress where there were also other family members listed. Her apparent husband was listed so I googled his name. Turns out he's an attorney specializing in Mergers and Aquisitions with a big Norwegian law firm... Now this could all just be some strange coincidence but I think stock ownership with Norwegian brokers/banks is public information so just maybe could be someone trying to reach out to stock owners..? Anyway, will see if I can find out more next week.

Was surprised about how most of the personal information is public in Norway. Does this create a caste system like India where the rich are treated better since birth?

 

[Causalien]

Looking up... the top 1% in India have a mean reported income of $11k/yr but due to underreporting, an actual $20k/yr. This puts India's top 1% (13,5M people) about on par with overall per-capita income in Greece (10,7M people), the Czech Republic (10,6M people), Estonia (1,3M people), Saudi Arabia (33,4M people) and Portugal (10,3M people). Definitely a meaningful market - not super-massive, but not something that you want to ignore.

India need to fix their electrical grid first. I expect Tesla energy need to go in before wide spread adaptation of electric cars.

In asia, I expect the following countries have their electric grid up to date and the environment for tsla:

China, S korea, Malaysia, Singapore, Taiwan, Vietnam.

The rest will just cause too much problems and not worth the efforts to solve for local constrains. Even if their top 1% are so rich due to the large wealth inequality.

 

[sundaymorning]

This explains why Saudi wants to own TSLA but not why they’re willing to pay a premium.




I don’t fully understand your answer. I come from an engineering background.

What is the problem with the Saudis purchasing a higher percentage (say up to 18%) on the open market after Elon made the announcement?

To answer this question you’ll need to wait the next 2-3 months to see how this will play out. The thought of bringing $10 billion to buy stock on the open market at current retail price will likely drive SP beyond $500.

Even if the Saudis time the market correctly and buy at the exact right time on every drop it would be hard to keep the SP down as we get closer to Quarter 3 numbers. Hence, if the Saudis are buying at the open market they’ll need to do it before numbers are released. It’s basically a race against time before end of Q3 to accumulate as many shares as they can now, that way they end up buying out less people at $420.

Let’s say the Saudis are able to accumulate another 10%, that puts them at 12-15% before end of Q3, they’ll still need to buyout all the other institution holders who are refusing to sell at current prices. Just because 5% of holders are selling at $320, $310, etc. doesn’t mean the majority are willing to sell at $350 or $380s.

Even if the Saudis nabbed every share from retail sellers it would only be 20%, what about the institutions who own 80%? You have to please them too. Owning 15-20% doesn’t mean you can take this company private. The idea is that if you want privacy, then it comes with a price. This isn’t as simple as buy and sell transaction. This is a deal to take the company private, and they've approached Elon for that purpose. And in order to avoid class action lawsuits, you have to please shareholders and give them good reasons for this move.

Now if the Saudis are accumulating now and they hold, then Tesla shares will just became that much more valuable because there are less shares available to sell/buy at retail, so the SP will increase naturally through demand. In the end, it won’t matter if the Saudis buy now or later, eventually SP will go up, perhaps beyond anyone’s ability to take this company private comes Q3 numbers. This is why Elon made such a haste decision on his tweet, because he knows Tesla is about to get expensive, even for the Saudis.

 

[AZRI11]

I've already worked out that there should be no limit on the number of accredited investors or the number of foreign investors. For what Musk actually wants, a "public unlisted company" with restrictions on stock trading seems to do the trick, which eliminates all worries about number of investors. Even if genuinely private for SEC purposes, it looks like the 2000 rule is easily worked around. Promote my tweet please.

Nathanael Nerode on Twitter

There are going to be a lot of IRA investors and 401(k) investors and RRSP investors who are out of luck. I don't know how many shares are held by such plans.

Yeah, I don't think this can be accelerated.

I'll be out as an investor, but the mission is more important than I. Private.

 

[sundaymorning]

Asia markets poised for higher open on Monday following positive news on US-China trade

Let’s hope we spike with it. Production and VIN registration looks really good right now.

 

[srius]

I'm clueless about how this buyout process is likely to be communicated to shareholders. Assuming the entire buyout process takes about a year, how long would you guess it will take until more solid information about the buyout is released from Elon to the public? Is the thinking that we aren't likely to hear much of anything until Elon finishes putting it all together and then presents his buyout proposal to the Board? Are we even likely to hear about that? It seems hard to fathom that we may not hear anything further for 5+ months at this point. Ben Kallo had expressed on an interview last week that he was hopeful of hearing a lot more detail about the potential buyout within about 10 days. Does that seem realistic? Hearing the opinions here, I'm thinking it's not.

 

[KarenRei]

Asia markets poised for higher open on Monday following positive news on US-China trade

Let’s hope we spike with it. Production and VIN registration looks really good right now.

I think there's enough to drag Tesla down despite this.

* Musk's "bankruptcy if I don't keep working this hard" tweet
* Reports that he may be breaking up with Grimes (aka more "mental state" questions)
* Lucid Motors getting an investment from PIF will be seen by many as a final nail in the coffin against Tesla getting privatization funding from them
* All of the different "simmering" stories (lawsuits, SEC, etc) which might make further news at any point.

We're obviously going to spike back up when the "stories of the day" disappear and focus returns to production (which is going superbly). But I think tomorrow is too soon, and wouldn't be surprised to see a further dip tomorrow.

 

[AZRI11]

I mean Lucid Motors, WTF. That car????

I'm restarting american motors. Expecting at least a billion from Saudi fund, who else wants in?

 

[TaoJones]

That is very interesting. I'd expect left wing is more associated with the democrats and liberal minded people. Those that generally comes from the counter culture and shunning large media outlets. It is the conservative and Trumpians that should align more with large news media companies.

Have the two switched their roles?

It wouldn’t be the first time. The Democratic Party used to be the conservative ones. Tell that to the low-information voter today and they’d sooner string you up than believe you.

And so it goes.

 

[srius]

I'm clueless about how this buyout process is likely to be communicated to shareholders. Assuming the entire buyout process takes about a year, how long would you guess it will take until more solid information about the buyout is released from Elon to the public? Is the thinking that we aren't likely to hear much of anything until Elon finishes putting it all together and then presents his buyout proposal to the Board? Are we even likely to hear about that? It seems hard to fathom that we may not hear anything further for 5+ months at this point. Ben Kallo had expressed on an interview last week that he was hopeful of hearing a lot more detail about the potential buyout within about 10 days. Does that seem realistic? Hearing the opinions here, I'm thinking it's not.

Tesla needs to unveil a privitization plan ASAP to stop the uncertainty. We just don't know if they could get investors lined up.
The solar city merger vote could have been earlier, as it was reportedly delayed by lawsuits. But keeping existing Tesla holders might complicate the privatization process and extend the privatization process.

With hindsight, we know it's premature for Elon to tweet with such certainty, especially without consulting anyone. It has completedly derailed the momentum from positive earnings report and took focus away from Tesla's excellent model 3 exiecution. I doubt Elon himself knew the repercussion when making the tweet. Putting forward a credible merger plan ASAP seems the only choice to get out of this mess. (Elon is unlikely abandoning the idea.) I was fairly sure that's what Elon would had been focusing on. But given the latest NYT blunder - no clear objective granting the interview and no preparation to guard his emotions, it's getting more uncertain to count Elon doing the most logical thing.

I'm clueless about how this buyout process is likely to be communicated to shareholders. Assuming the entire buyout process takes about a year, how long would you guess it will take until more solid information about the buyout is released from Elon to the public? Is the thinking that we aren't likely to hear much of anything until Elon finishes putting it all together and then presents his buyout proposal to the Board? Are we even likely to hear about that? It seems hard to fathom that we may not hear anything further for 5+ months at this point. Ben Kallo had expressed on an interview last week that he was hopeful of hearing a lot more detail about the potential buyout within about 10 days. Does that seem realistic? Hearing the opinions here, I'm thinking it's not.

Tesla needs to unveil a credible privatization plan ASAP to stop the uncertainty. We just don't know how soon Elon could get investors lined up.
The solar city merger vote could have been earlier, as it was reportedly delayed by lawsuits. But keeping existing Tesla holders complicates the privatization process and may extend the time required.

 

[winfield100]

Speaking of law firms... Now this:

https://www.marketwatch.com/amp/story/guid/b5bb6fd0-9df4-4e49-ab26-cf2530a5e1ce

Since when are traders and shorts "investors"?

 

[RobStark]

* Lucid Motors getting an investment from PIF will be seen by many as a final nail in the coffin against Tesla getting privatization funding from them

Lucid may be getting 1 MbS yacht worth of cash infusion then another MbS yacht worth if they hit targets.

 

[schonelucht]

Does this create a caste system like India where the rich are treated better since birth?

Yes, it does. But every Norwegian is rich anyway, so it doesn’t matter.

 

[Krugerrand]

Andrea James responded further on the NYT interview:

View attachment 327026

She sounds like she’s just being PC, not wanting to ruffle anyone’s feathers on either side.

 

[juanmedina]

I just watched the interview with Marques and he looks like his usual self; making jokes and entertaining. When I watched on Friday after NYT I did not really enjoy it and I was worried. You guys should watch it again is a great interview. I am long to the end:

 

[MTL_HABS1909]

Elon musk likely broke up with grimes over Last several days. Could help explain sadness while talking to NYT. Check out vanity fair article for sadness comp. I have read his bio book several times - things are very predictable with him.

Agreed. I saw that he stopped following her on twitter and that’s when I made the connection. The guy is only human. It’s hard enough for “regular” people when a relationship ends. I can only imagine what it’s like under the immense pressure/scrutiny he deals with. I feel for the guy.

 

[AudubonB]

India need to fix their electrical grid first. I expect Tesla energy need to go in before wide spread adaptation of electric cars.

In asia, I expect the following countries have their electric grid up to date and the environment for tsla:

China, S korea, Malaysia, Singapore, Taiwan, Vietnam.

The rest will just cause too much problems and not worth the efforts to solve for local constrains. Even if their top 1% are so rich due to the large wealth inequality.

Did you forget about Japan or did you omit it for a reason that escapes me?

 

[Causalien]

Did you forget about Japan or did you omit it for a reason that escapes me?

An old fashioned notion that Japanese are very loyal to their own country and will buy the Japanese alternative instead.

Sort of the dame for Korea. Don't know why I included it. Must be all the koreans I know here who wants a tesla. But the Japanese here still buys only Japanese cars.

And I forgot about thailand.

 

[Causalien]

Agreed. I saw that he stopped following her on twitter and that’s when I made the connection. The guy is only human. It’s hard enough for “regular” people when a relationship ends. I can only imagine what it’s like under the immense pressure/scrutiny he deals with. I feel for the guy.

I wonder if Azaleia has anything to do with it.