TSLA Market Action: 2018 Investor Roundtable

[mekberg]

Added another 20% to my position @ $270.

Let the games begin.

 

[Wooloomooloo]

Also read the entire complaint and liked your post since their isn't an "Agree"-button.

The SEC does not once state that Elon had the intent of harming investors. Their case is hinged entirely on recklessness = he should have know that behaving the way he did could have harmed investors.

To be clear, the behavior = stating misleading facts or omitting facts that would make the statement misleading.

Actually the distinction between knowingly, or recklessly not knowing, will either make or break the SEC case.

If Musk knew the statements were false, there must be intent, otherwise why would he make them? The only 'intent' would be to cause market disruption which would harm real investors in the company. That will be almost impossible to prove, and I don't think anyone would really believe that's true.

I'm having a hard time defending reckless, the whole thing was somewhat reckless. At worst, Musk was incompetent and ill-informed, but I think it's an incredible stretch to suggest he didn't think or care about the consequences (which is part of the legal definition of reckless) and even more of a stretch to prove it. It's well known that he has the highest regard to the people who support and believe in Tesla, and his comments about trying to keep investors involved in the private company, demonstrates that.

 

[ZsoZso]

Typically, in the stock market or anywhere else, the malicious people are a few minority. In case of TSLA, the longs seem to imply that the entire media, analyst community, big hedge funds, sovereign wealth fund and even SEC is malicious. How can so many people be malicious and only a small bunch of retail investors trying to save Earth are righteous? Just doesnt add up.

Easy! They have literally BILLIONS of reasons -- as in $billions

 

[jkirkwood001]

9kshares+1k calls more? WOW

I'm guessing @emir-t meant $9,000 in shares, right? Not $2,400,000 (9000 x 270) in shares?!?!?

 

[emir-t]

I'm guessing @emir-t meant $9,000 in shares, right? Not $2,400,000 (9000 x 270) in shares?!?!?

Of course 9k $. 9k shares I would've already been riding in a Tesla instead of drooling over one for the past decade.

 

[Right_Said_Fred]

If it is possible to file suit against the SEC for this, I would join it.

I think it is definitely something that Elons legal team could use in their case. “Look, even the SEC does it, with grave consequences (media quoting ‘fraud’)”. Someone should bring it to their attention.

 

[Nocturnal]

That feel when the SEC is protecting investors by damaging investors. Maybe we should greet them as liberators?

 

[jhm]

Tesla achieves Model 3 production goal for record quarter with 2 days still to go

Wonderful. At a annual rate of 320,000 total cars, Tesla now has 0.4% share of the auto market. Easily this exceeds a 1% market share just with continuing to ramp up Model 3. Tesla could get there by end of 2019.

I do think we are crossing a critical market share threshold here. At lower market share, there is the worry that a competitor might want to control Tesla just to suppress it. But at higher market share, this flips. Now a competitor might want to acquire Tesla just to grab the market share potential going forward. For example, VW has about 10% market share of the global auto market. If it were to acquire Tesla is would rapidly expand to 11% market share in 2019. That would be phenomenal growth for the market leader, almost impossible for them to do through organic growth. But longer term, a Tesla acquisition could take VW to 20% market share by 2030. No doubt this would be a very good survival strategy as Chinese EV makers make inroads into the global market. So the value of Tesla at this point is wrapped up in what is worth as an acquisition target, and it's ability to seize market share makes it enormously valuable. It may even be of existential value to competitors such as German automakers.

 

[ggr]

CNBC newsreader let slip riiight before the presser, that the SEC's end-of-fiscal-year is 30 September, that it sounds cynical but it seemed the SEC was "timing this to justify their existence." Is that true about 30 Sept? If so, is this their way of Window Dressing?

For our part, is it not the time and place to employ some Jiu Jitsu? Use the heightened visibility of pretrial to shine some light on the sus timing of hit pieces and manipu-trades?

I dunno, I'm just a sentient cat with some questions.

End of September is end of financial year for virtually all of the government. There is a very strong "use it or lose it" attitude. See for example: How to Take Advantage of Federal Fiscal Year-End as a Solutions Provider

 

[Tingtong]

Just bought more at $269.69.
Let's see if it's a good or a bad sign.

 

[jeewee3000]

I'm having a hard time defending reckless, the whole thing was somewhat reckless. At worst, Musk was incompetent and ill-informed, but I think it's an incredible stretch to suggest he didn't think or care about the consequences (which is part of the legal definition of reckless) and even more of a stretch to prove it. It's well known that he has the highest regard to the people who support and believe in Tesla, and his comments about trying to keep investors involved in the private company, demonstrates that.

I am on Musk his side, but the legal definition of reckless is different than the regular use of the term. I'll let the relevant paragraph from the SEC charge speak for itself. This is their view:

Musk Knew or Was Reckless in Not Knowing that His Statements Were False and Misleading
68. Musk made his false and misleading public statements about taking Tesla private using his mobile phone in the middle of the active trading day. He did not discuss the content of the statements with anyone else prior to publishing them to his over 22 million Twitter followers Case 1:18-cv-08865 Document 1 Filed 09/27/18 Page 18 of 23 19 and anyone else with access to the Internet. He also did not inform Nasdaq that he intended to make this public announcement, as Nasdaq rules required.

69. Musk’s statements were premised on a long series of baseless assumptions and were contrary to facts that Musk knew. Between the July 31 meeting with representatives of the Fund and his August 7 misstatements, Musk knew that he (1) had not agreed upon any terms for a going-private transaction with the Fund or any other funding source; (2) had no further substantive communications with representatives of the Fund beyond their 30 to 45 minute meeting on July 31; (3) had never discussed a going-private transaction at a share price of $420 with any potential funding source; (4) had not contacted any additional potential strategic investors to assess their interest in participating in a going-private transaction; (5) had not contacted existing Tesla shareholders to assess their interest in remaining invested in Tesla as a private company; (6) had not formally retained any legal or financial advisors to assist with a going-private transaction; (7) had not determined whether retail investors could remain invested in Tesla as a private company; (8) had not determined whether there were restrictions on illiquid holdings by Tesla’s institutional investors; and (9) had not determined what regulatory approvals would be required or whether they could be satisfied.

70. In addition, Musk knew that Tesla’s board had not yet voted on any proposal or authorized a shareholder vote on it, and in fact, Musk had not yet even submitted a formal proposal to Tesla’s board.

71. Musk did not disclose any of these material facts that were known to him when he made his August 7 statements. Unlike market participants reading his tweets, Musk knew that his ostensibly “secured” funding was based on a 30 to 45 minute conversation regarding a potential investment of an unspecified amount in the context of an undefined transaction Case 1:18-cv-08865 Document 1 Filed 09/27/18 Page 19 of 23 20 structure. Musk also knew that there were many uncertainties beyond just a shareholder vote that would have had to be resolved before any going-private transaction could have been possible. As a result, Musk knew or was reckless in not knowing that his August 7 statements were false and misleading.

I'm not saying the SEC is right. I am saying it isn't as crystal clear as some make it out to be.

In Elon's defense, the above is basically a double negative. They say A) Elon did not know enough details about what he suggested and B) He left out that he did not know enough details. You could argue that - by not speaking of details - you are implying you don't know the precise details. (The term "considering" will help this argument, IMHO).

Now let's just sit tight and wait for those damn delivery numbers. They better be fantastic.

 

[Foghat]

Probably already posted, but don't have time to wade through 20 pages at this moment:

SEC Sues Elon Musk for Fraud, Seeks Removal From Tesla

What I find interesting here is that SEC offered a settlement, which Elon refused, hence the action.

So either a) the settlement was unacceptable or b) Elon is innocent of the charge - I believe the latter, but we still need to be dragged though this.

Very clever by the shorts to manipulate the SEC to do this at this moment, they were about to get burned badly - could still happen.

So, September sales estimates about to blow everyone out of the water, and this comes out —rushed — to put cold water on historic q3 news this coming month?

I hope with full force Tesla take this all the way, because a market that is manipulated to this extent must be stopped. The entire reason for going private was to combat such rampant corruption in the public markets to the ascending success of Tesla in relation to stagnant entrenched competition.

The natural course is consumers love the American company Tesla. Globally, people want Tesla products. Tesla is doing everything it can to grow to meet this insatiable demand. However, unnatural forces are desperately doing everything they can to stop this natural market. It is manipulation that the entire SEC and our American government is set up to prevent.

This is much bigger then they think.

 

[MarcusMaximus]

Wonderful. At a annual rate of 320,000 total cars, Tesla now has 0.4% share of the auto market. Easily this exceeds a 1% market share just with continuing to ramp up Model 3. Tesla could get there by end of 2019.

I do think we are crossing a critical market share threshold here. At lower market share, there is the worry that a competitor might want to control Tesla just to suppress it. But at higher market share, this flips. Now a competitor might want to acquire Tesla just to grab the market share potential going forward. For example, VW has about 10% market share of the global auto market. If it were to acquire Tesla is would rapidly expand to 11% market share in 2019. That would be phenomenal growth for the market leader, almost impossible for them to do through organic growth. But longer term, a Tesla acquisition could take VW to 20% market share by 2030. No doubt this would be a very good survival strategy as Chinese EV makers make inroads into the global market. So the value of Tesla at this point is wrapped up in what is worth as an acquisition target, and it's ability to seize market share makes it enormously valuable. It may even be of existential value to competitors such as German automakers.

Huh... buried in there is production of 26,400 S/X so far in the quarter. Not bad.

 

[electrictorque]

The iphone I was going to buy can wait. I know it's not much, but I'm showing my support to Elon by buying a couple of shares.

 

[dqd88]

I bought more stock today and I sent tweets to SEC enforcement stating I do not agree that they are protecting investors with this suit.

I am also sending tweets to ValueAnalyst to retweet to a larger audience in support of Tesla.

I hate Twitter, but it was time to get in the ring and show my support more publicly than here on the boards.

I decided not to sell Tesla shares. I took this decision when I bought them. I do believe in Tesla/Elon mission. I'm here in a good and bad situation. I'm long.

In such moments I'm always going trough my fundamental reasons why I'm here:
1. Mother Earth needs me. The problem of human impact to this planet will not go away. I have to do something.
2. The society have problems with truth, bad people, self interests no matter to the consequences. I have to do something.
3. I'm the warrior as my father before me, as my grandfather before him...we never give up. Why? We never pick up the fight according to the enemy, but according to the holiness we defend. This was laid in my cradle.

Elon had the opportunity to settle down this issue with SEC. If he accept it he would lose his face. He knows that. It would be as he betrayed his basic principle to change what is bad in humanity. He stood with his believes even when this path will be hard for him. I didn't think that he can rise my respect even more, but he did. Elon is true warrior.

I'm preparing ammo for next week. Any suggestion what can I do more?

You have my respect!
Elon is our William Wallace

 

[dqd88]

So back to market action...any guestimate what the price will open and close at? I’m doing a wire transfer asap in the AM. I can’t really tell but perhaps it’ll be between $260 to $285

you called it

 

[jhm]

CNBC reporting that:

• The settlement would have barred Musk as Chairman for 2 years
• Fined Musk and Co.
• Required company 2 new independent directors
• Required Musk neither admit nor deny culpability

Apart from settling, I think Tesla should add two independent directors. The question is, who? I would kinda like to see Jigar Shah on the board. I think he can bring some really good leadership in the Energy space.

Also I get the impression that Kimbal may be taking a more visible role perhaps as a prelude to being named as Chair.

If the board were to move fast to add a few directors, it could also lower the stakes for the SEC suit. Naming Kimbal as Chair would take this further. There would be little upside for pursuing weak case in court, and the whole thing could be dropped.

But apart from how this would impact the SEC action, I think there are other benefits to enhancing the board as Tesla grows and expands into multiple industries.

 

[Wooloomooloo]

I am on Musk his side, but the legal definition of reckless is different than the regular use of the term. I'll let the relevant paragraph from the SEC charge speak for itself. This is their view:

/snip

I'm not saying the SEC is right. I am saying it isn't as crystal clear as some make it out to be.

In Elon's defense, the above is basically a double negative. They say A) Elon did not know enough details about what he suggested and B) He left out that he did not know enough details. You could argue that - by not speaking of details - you are implying you don't know the precise details. (The term "considering" will help this argument, IMHO).

Now let's just sit tight and wait for those damn delivery numbers. They better be fantastic.

Agreed - but this is the phrase I think will cause the SEC's case to be very difficult

"Musk’s statements were premised on a long series of baseless assumptions and were contrary to facts that Musk knew."

His legal team will simply argue that his statements were made in the belief that there was a very strong basis for taking the company private, and that he was not aware of facts that contradicted that.

Yes there are definitely things he should have done and didn't, such as inform NASDAQ and really he ought to have told the Board and others within the company. But the main charge is that he knowingly said something untrue, as opposed to he basically said something ill-informed and without proper consultation.

I'd agree with the latter (even though I'm a fan), but the former lacks credibility.

 

[ValueAnalyst]

Thread: $TSLA Bulls are united against $TSLAQ

ValueAnalyst on Twitter

 

[Nocturnal]

I added about 10% more to my holding's last night. I've said it before that I think (who knows) it is a good investment and I also believe in the company. Nothing has materially changed with this lawsuit. The company is still building a lot of nice cars that people want. Worst case Elon just becomes the idea guy and a more boring person takes the day to day reigns. This does not justify a 20% drop IMO.