TSLA Market Action: 2018 Investor Roundtable

[ggr]

Just pondering the day we live in, instead of being lemmings to bullshit headlines and talking heads, we can get the full legal filings at the convenience of our smartphones and decide for ourselves it's horseshit.

Planning on writing a letter to the SEC, cc my senator and rep. Any advice?

You have a very good point, I am in the process of drafting a letter to my representative. I will cc it to the senators too. Since it isn't possible to actually sue the SEC, it is one of the duties of the representative to look into any disputes or misconduct by any government agency. I basically intend to point out that:
1. The agency seems to be engaged in selective prosecution
2. The actual complaint does not assert fraud, but they held a press conference and used that word
3. I have met Elon Musk on three occasions, and have no personal doubt that he has the highest integrity and meant what he said
4. Musk did not profit from the situation, in fact his concern was for the other shareholders
5. I lost money as a result of the situation, but I lost the most from this misguided lawsuit

I'm not currently feeling well enough to actually draft the letter at the moment, but will do so as soon as I can, and I'll post it here (in its own thread when I do, in case others want to use it.

It is absolutely your representative's duty to follow up on this.

 

[KarenRei]

So in the next few trading days: relief from settlement, good maybe great q3 numbers, and possible profits

You won't find out about profits for another month.

 

[tivoboy]

YES!. good job Elon, wearing the big boy pants now.!!!

While the deal is much better than the alternative, I'm pretty certain we'll see a capital raise now within 6 months. So, factor that into your optional thesis.

 

[Open Interest]

From the SEC press release: "The SEC also today charged Tesla with failing to have required disclosure controls and procedures relating to Musk’s tweets, a charge that Tesla has agreed to settle."

Thank you, I was unaware of that move. So they charged and resolved in the same day??

 

[wipster]

Everybody said this was impossible???

It isn't what happened...

 

[glen thomson]

This could be financially bad for Musk. I just read the settlement - he has conceded that he will not deny that he misled investors. Surely this means he cannot defend against the lawsuits from people who lost money? If so, that will cost him a lot. Not critical, and won't affect Tesla, but very expensive for him - I have seen some estimates of up to $1 billion or so.

hopefully if that is true he doesnt have to pay them for like 5 years cos his net worth will probably be 50 billion by then and so wouldnt be as bad

 

[emir-t]

Any price predictions for Monday close? 290-300 band or 310+?

 

[Fact Checking]

It's very possible to go too far in terms of muzzling him. I love Musk's openness on Twitter. He just needs a filter.

Note that the settlement only impacts his communications that relate to Tesla investors. He is still free to react to Tesla owner feedback positively, talk about AI, space and his next girlfriend.

Just no pedo guys and no buyout announcements in trading hours, without clearing it with the Tesla board first.

Which is pretty commonsense, and Elon needed to grow up in this regard.

This is seriously very good news in all regards. Thanks SEC ... and I mean it!

 

[BornToFly]

YES!. good job Elon, wearing the big boy pants now.!!!

While the deal is much better than the alternative, I'm pretty certain we'll see a capital raise now within 6 months. So, factor that into your optional thesis.

Why would we have a capital raise in 6 months when revenue will be through the roof with excellent cash flow and lots more cash on hand?

 

[gringotuanis]

I don't think so: it has verbiage preventing him from disputing the facts alleged. It doesn't have verbiage accusing him of recklessness or fraud.

Elon can, will, and has every right to deny wrongdoing.

The facts would have been undisputed in large part anyway - but the facts listed matter to any traders who are suing: they won't have to go through discovery to gain access to Elon's and Tesla board member SMS messages cited in the SEC complaint for example. I.e. the SEC helped them a bit with this.

I just read through the agreement:

Looks reasonable, looks like mostly about face saving for the SEC, and a slap on the wrist for Elon.

Elon was right about the "Am considering..." tweet, but he wrote many other tweets that showed lack of message discipline.

I have to admit, the SEC just increased the value of TSLA tremendously: Elon agreeing to the Tesla board filtering Elon's Twitter messages: priceless!!!

That is priceless. We needed someone to get him off Twitter. If it's the government, so be it.

 

[tander]

You won't find out about profits for another month.

Not necessarily, iirc last time Musk tweeted about it almost immediately. Guess tweeting is out of the picture but I wouldn't be surprised if there is a blog update or something in the next couple days about profits. If not there will be a month of "Tesla just made of ton of cars so they are losing even more money" type stuff. But then again it would be pretty interesting if there's a month of that, they get back to like 50% short interest, then post profits!

 

[MP3Mike]

I don't think so: it has verbiage preventing him from disputing the facts alleged. It doesn't have verbiage accusing him of recklessness or fraud.

Elon can, will, and has every right to deny wrongdoing.

You are adding words that aren't there. It actual says "denying the allegations in the complaint". There is no mention of facts.

So Elon can't just come out and publicly say "I didn't mislead investors." However, if someone sues him for the same thing he can defend himself and testify that he didn't mislead investors.

 

[dqd88]

I won't. I manage risk first, and I am way on top on this trade so far.

No need to get emotional about this

You'll eventually lose it all, because karma's a bitch. Shorts are scum of the earth. If it were just a financial play a normal stock I wouldn't get pissed. But this is a company that is good for the planet. ICE and oil have done enough damage and need to die. Tesla is usher us into a brighter future, if you try to inhibit that then you are an evil POS.

 

[azaz]

So can someone please factually summarize the differences between original settlement and new settlement?

What did Elon gain/lose?
What did Tesla gain/lose?
What do is shareholders gain/lose?

Thanks

this is tough to do as we don't have the text of the original statement but I will make my best attempt.

Point 1: According to most reports the initial settlement was the same deal but with a 2 year ban as Chairman instead of 3 year. It appears Elon actually lost and had to submit to 3 years. However one reporter to the contrary of all other journalists said the initial deal was also a CEO ban. If he is to be believed then Elon gained but he is on an island with his report. Additionally Elon's fine was doubled from 10 million to 20 million.

Point 2: Seems to be they got their fine doubled as well.

Point 3: Shareholders will not feel any effect between the 2 settlements imo

 

[tivoboy]

Woo, I should be in line for a buck 50 out of this.

probably 30-38, probably not 50.. we'll see.

 

[BornToFly]

Any price predictions for Monday close? 290-300 band or 310+?

300+

 

[Cosmacelf]

Sounds like sentiment is positive for this? Does it bother anyone that Musk will no longer be chairman of the company?

Talk about a roller coaster for all sides. I'll be sticking to my short position obviously. I do expect a rally in the SP monday.

Chairmanship is mostly a ceremonial position. He is still a member of the board. It’s a non factor.

 

[Rarity]

I don't like the two new independent directors and the independent chairman. Didn't we shareholders just vote that down 85/15?

Trojan horse...

 

[tivoboy]

Why does everyone want Kimball? I like him personally but this board needs a heavy hitter that will give big institutional investors peace of mind, and that's not Kimball. That's someone like Eric Schmidt. Someone with experience managing high growth, big market cap tech companies. I just don't get the Kimball benefit, other than he's a really cool guy who loves his brother. But from investment standpoint, why?

Uh, no please no.

 

[MXWing]

@MXWing No, because we don't have the details of what was in the original agreement.

That's an impossible request. The original settlement agreement was not leaked.

Thank you both for jumping in and answering.

While dissaponting to not know these things, I would like to think it would be an improvement.

My logic being is I think the board should have and would have advised Elon to settle under the original terms if it was bearable.

Game theory would tell us the SEC was going to to do what they did on Friday if Musk said no to the terms.

The SEC gets its pound of flesh today. Just no idea if the chunk hurts less in “effective terms”.