TSLA Market Action: 2018 Investor Roundtable

[sub]

It's really interesting to see 2 types of people:
1. Ones that absolutely don't understand how you could be upset from a short term "loss". Elon is in this camp.
2. Ones that do get upset. I was quite intrigued seeing his all-time supporter(bottom), who leaves positive responses to almost all his tweets bark back at him.
View attachment 341297
Seems like a problem that some people that claimed to be supporters get upset? Some who trade options also call themselves supporters, although that's not really investing.

- how do you feel about emergencies? Say, tommorrow you (or relative) get sick and you need to withdraw a lot to pay for the treatment. Well, you're long and have 10 years to get your money back, right? Not really, you need money today and you only get back 2/3. Well, you have 10m and have enough for 10 emergencies. Congratulations! You have a full right to not understand why somebody would get upset. I think 10 years life savings would fit into this category nicely and correlate to cancer treatment costs which may or may not be covered by insurance.

- how about you're long in tax sheltered account and your short term account is 1/3 short after the tweets? When you opened it, you thought the chance you would need this money is pretty low. But some smaller emergency did happen, so it's not 10 years you lost, but maybe 1.

Agree that all investment is risk yada yada, your own fault. Just saying that longs are not the only supporters. Tesla did not benefit from your long money(and my money specifically), unless you bought at IPO.
So, somebody who's not "long", but was recommending products to their friends, would be more valuable to Tesla.

It is possible that some of these recommenders are upset and it is possible that this is related to tweets. Longs are not the only ones Elon should be concerned about.

So what your saying here is it’s Elons fault that people don’t plan their lives properly?

I went in for another ~120 shares after the go private tweet, yet I haven’t complained one time about it. Why is that? Elon didn’t make me do it, I decided to do it KNOWING THE RISK AND ACCEPTING ALL POSSIBLE OUTCOMES.

If I didn’t have health insurance, I wouldn’t invest money I needed for health concerns in a stock/market that could lose value over night. A fool and his money are soon parted as they say.

Only the “pedo” tweet made me cringe a little because I know how “PC” we are expected to be these days. The pedo popped off at the mouth first thoug.

I’ve said this before recently, you can not diagnose someone’s mental state by reading their twitter acct. anytime I see someone referring to Elon as “unhinged” based on a few tweets, they lose all credibility with me.

I think the issue is that only fellow rational/logical thinkers truly understand how Elon operates, the rest only think they know. How can you tell the difference? It’s pretty easy, the irrational ones have responded with emotion about the twitter issue.

I have zero problem with what Elon has said or why he has said it, and I’ve never seen him act or speak irrationally, not for a moment. I do wish he would put down the tweeter though because I don’t like seeing emotional Tesla supporters losing their sugar.

 

[Thekiwi]

The point was, THIS is the first time Elon didn't say a word about forward guidance, at the time of the release of the production numbers...
You're certainly correct in what you said, but he's also been tweeting out un-official FG during the production numbers...
This is is the first time he didn't...

This is simply incorrect - Tesla traditionally hasn’t issued forward guidance on delivery reports.

 

[dqd88]

Not one word about the tremendous debt overhang on a federal, state, local, corporate and consumer level. The rising interest rates are going to cause a recession. But that is their purpose in the end.

The debt is only a problem if revenues decline too much. How much debt do those guys have relative to historical levels? As long as there is capital stimulus it will trickle down to revenues for govts and employees/consumers and businesses. Do you see spending slowing down?

 

[Thekiwi]

Any longs have an answer for this? Especially given that Tesla is supposedly making its own car carriers?

Flash Jourdan on Twitter

Half the time the car carriers Tesla uses are empty, obviously (between when it has delivered a load and when it is refilled again)

A 5th grader can figure this out.

I’m kind of surprised you can even use a computer to type your posts. Do you have a helper?

 

[dqd88]

I doubt this very much. At least as long as GenXers are alive.

People still buy Rolex despite the fact Apple Watch is superior. Even Seiko is better at telling time.

People still buy thoroughbred horses.

People pay ~30% premium for "real diamonds" over more environmentally friendly synthetic diamonds.

It may be that GenXers are the last generation where there is significant buyers for smelly poisonous outdated transport machines. Or maybe not.

Hmm... this made me think. I'm a gen Xer.
You have a point that those products are still purchased, but my hunch is that sales are not what they were in their heyday.
Tough to say w/ Ferrari. I believe they cost around 250k. So is a buyer going to buy both the Ferrari and the Roadster? Similar cars, similar cost. Maybe some will buy both, but I think Roadster will eat into Ferrari's sales at least a bit.

 

[dqd88]

Try Whale Wisdom

Thanks. cool site!
I looked up Greenlight Capital/Einhorn - guess what - his top holding is GM, 26%.
No wonder he hates Tesla!

Is there a way to see this company's short positions? Only see a link to intl' shorts

 

[MarcusMaximus]

You will still be able to drive around in your Ferrari collection in 20 years. At that time the battery of the Tesla will be gone...

So will most of that original Ferrari.

 

[UnknownSoldier]

Thanks. cool site!
I looked up Greenlight Capital/Einhorn - guess what - his top holding is GM, 26%.
No wonder he hates Tesla!

Is there a way to see this company's short positions? Only see a link to intl' shorts

Nobody shares their short positions except to be vocal about a certain few they are trying actively to destroy that moment. This is how Chanos, Einhorn, Left, et. al operate.

Einhorn is extremely notorious both for his short position in Tesla and his long position in GM. As a major GM long, a few years ago he led a shareholder revolt in an attempt to split GM stock into pools of dividend paying and non-dividend paying shares. GM rebuffed him and he's been mad about it ever since but apparently not mad enough to ditch GM because he's been hellbent about riding GM down to the Earth's core even though there's literally nothing interesting about GM that makes them worth holding long.

 

[avoigt]

Some thought and observations. Just my personal view and sorry for the long read.

• Its interesting to see all the trolls jumping in and then up and down at times when the SP is depressed and longs/bulls are more silent during this phases. Its understandable that shorts try to claim they are right and long may miss good arguments to counter but all of those does not change any fundamentals. Tesla has never been in a better position before so it feels perfect to me to be long since years. Th improvements of fundamentals exceeds my expectation and the value that is in the stock although not visible yet at Nasdaq is remarkable.

• Its human to search for easy answers in a complex world. This board is a nice reflection of everybody searching for an answer why the SP did loose quite a bid this week. The reality is unfortunately quite complex and many elements come together that are not visible to us or hard to understand in their interaction. Tweets from Elon are an almost perfect opportunity for shorts to try to shape the narrative and given that all fundamentals are against them and they have actually not a single fundamental valid point on their side any more. So they are really grateful for good reason that Elon is sending some Tweets that they can use for their purpose. Longs search for an answer and explain its all about Elons Twitter behavior. Regardless if you like or dislike his Tweets its not the simple and single answer for the movement we have seen this week. I am afraid but the world is more complex than that. So lets stock to explain that because he did twitter this we have seen a drop of that. Don't get hooked to simple answers!

• Its hard work if you want to succeed at the stock market. There is no "I get rich quick and easy". Latest after this week that should be transparent for everybody. You have to find a strategy that fits to you as a person and stick with it. Most people fail with both aspects of that sentence. Its a lifetime learning and improving and not an easy quick win. If you have a high volatile stock the risk of high leverage is obvious as you never know how strong it does swing. If you want to take that risk do not complain if the market does not do what you anticipated it should. Every aspect of time constrained investment (options, shorts, margin, ect) include your expectation of a stock to have a certain value at a certain time. Given a lot of not transparent manipulation, we have pretty much proof about, its not responsible to assume that the stock will move triggered by fundamentals alone.

• If you hear Elon talking to investors he does not talk about people who invest in shorts, options or leaps. He talks to people who buy the simple stock and hold them for a long period to be precise for many years. This are the ones he feels whole hardly committed to and grateful for. Nobody else. He will fight for those investors and will never give up. If you decide to invest in any kind of time constrained investments do not complain that Elon does not protect you and Twitters something that hurts you and your investment. Elon does not consider this people helpful for his mission. For real longs, losses on paper do not matter at all and be assured Elon will make sure you get a nice return on the long run. Short terms dips are therefore a perfect opportunity to maximize your benefit on Elon as a value creator.

• Finally if you feel uncertain have a look at the products, drive your Tesla a bid or look at a report about owners satisfaction and excitement or a nice owner video. A excellent loved product with a high margin and high demand is all what counts together with pace of innovation. The last time I was uncertain about Teslas future was back in 2014 I believe it was when the over engineered X created a lot of customer complains with regards to the Falcon Wing doors and the car did look to me more for a limited consumer group. The S had quality issues as well and the 3 not been released nor seen. That days are over and the product pipeline is in a better position than ever as well as production as well as demand as well as financials.

Its feels great to be a true long investor in Tesla. The risks are lower than ever and the opportunity well mapped and proven in front of us.

Writing this as I am about to sell my ICE car today and will never return!

 

[RobStark]

Hmm... this made me think. I'm a gen Xer.
You have a point that those products are still purchased, but my hunch is that sales are not what they were in their heyday.
Tough to say w/ Ferrari. I believe they cost around 250k. So is a buyer going to buy both the Ferrari and the Roadster? Similar cars, similar cost. Maybe some will buy both, but I think Roadster will eat into Ferrari's sales at least a bit.

When Ferrari was part of FCA sales were artificially held down to 7500/year and there were backorders up to 18 months. You had to know a salesman with clout to get the most sought after Ferraris and likely be a good customer buying at least every few years. Or you could pay an exorbitant amount over MSRP.

Now that Ferrari is independent they are looking to expand to 10k/year without killing the resale market. I like Ferrari's chances.

Not too familiar with Lambo other than they are part of the VW empire and they are not allowed to step on Bugatti's toes, the crown jewel in the VW reich.

 

[mrdoubleb]

Some thought and observations. Just my personal view and sorry for the long read.

• Its interesting to see all the trolls jumping in and then up and down at times when the SP is depressed and longs/bulls are more silent during this phases. Its understandable that shorts try to claim they are right and long may miss good arguments to counter but all of those does not change any fundamentals. Tesla has never been in a better position before so it feels perfect to me to be long since years. Th improvements of fundamentals exceeds my expectation and the value that is in the stock although not visible yet at Nasdaq is remarkable.

• Its human to search for easy answers in a complex world. This board is a nice reflection of everybody searching for an answer why the SP did loose quite a bid this week. The reality is unfortunately quite complex and many elements come together that are not visible to us or hard to understand in their interaction. Tweets from Elon are an almost perfect opportunity for shorts to try to shape the narrative and given that all fundamentals are against them and they have actually not a single fundamental valid point on their side any more. So they are really grateful for good reason that Elon is sending some Tweets that they can use for their purpose. Longs search for an answer and explain its all about Elons Twitter behavior. Regardless if you like or dislike his Tweets its not the simple and single answer for the movement we have seen this week. I am afraid but the world is more complex than that. So lets stock to explain that because he did twitter this we have seen a drop of that. Don't get hooked to simple answers!

• Its hard work if you want to succeed at the stock market. There is no "I get rich quick and easy". Latest after this week that should be transparent for everybody. You have to find a strategy that fits to you as a person and stick with it. Most people fail with both aspects of that sentence. Its a lifetime learning and improving and not an easy quick win. If you have a high volatile stock the risk of high leverage is obvious as you never know how strong it does swing. If you want to take that risk do not complain if the market does not do what you anticipated it should. Every aspect of time constrained investment (options, shorts, margin, ect) include your expectation of a stock to have a certain value at a certain time. Given a lot of not transparent manipulation, we have pretty much proof about, its not responsible to assume that the stock will move triggered by fundamentals alone.

• If you hear Elon talking to investors he does not talk about people who invest in shorts, options or leaps. He talks to people who buy the simple stock and hold them for a long period to be precise for many years. This are the ones he feels whole hardly committed to and grateful for. Nobody else. He will fight for those investors and will never give up. If you decide to invest in any kind of time constrained investments do not complain that Elon does not protect you and Twitters something that hurts you and your investment. Elon does not consider this people helpful for his mission. For real longs, losses on paper do not matter at all and be assured Elon will make sure you get a nice return on the long run. Short terms dips are therefore a perfect opportunity to maximize your benefit on Elon as a value creator.

• Finally if you feel uncertain have a look at the products, drive your Tesla a bid or look at a report about owners satisfaction and excitement or a nice owner video. A excellent loved product with a high margin and high demand is all what counts together with pace of innovation. The last time I was uncertain about Teslas future was back in 2014 I believe it was when the over engineered X created a lot of customer complains with regards to the Falcon Wing doors and the car did look to me more for a limited consumer group. The S had quality issues as well and the 3 not been released nor seen. That days are over and the product pipeline is in a better position than ever as well as production as well as demand as well as financials.

Its feels great to be a true long investor in Tesla. The risks are lower than ever and the opportunity well mapped and proven in front of us.

Writing this as I am about to sell my ICE car today and will never return!

I agree with probably 99% of what you say. I do consider myself a hardcore Tesla bull, long, call it what you want. My short term exposure to TSLA is very limited and it's only because I planned to make enough on my investment over the next ~12 months to make a large enough downpayment on a Model 3 so I can justify (to myself) taking a loan for the rest of it. The rest of my investment I plan to hold until 2021-25 at least - or longer. Hell, it may become my retirement money 25-30 years from now.

Having said that, the reason I am somewhat concerned is not that much us retail investors. As loud as we are on this board or social media, it is the big institutional players I am worried about. Even if they believe in the company, or maybe exactly because of it, their own investors and boards may force them to divest, which can cause a domino effect. Or they may be forced to have the board fire Elon. Which would be devastating.

I wholeheartedly agree with Galileo, that the most frustrating thing about this is the "and for what?" part. The company's fundamentals and future have never been better or more graspable. And to think we could lose all of that, so close to winning, due to a stupid Tweet that pushes public sentiment overboard so much that the cascade of forcing the hands of the big boys starts, makes me want to punch things. Even as I agree with Elon's sentiment towards the SEC and shorts, why would he hand his own head over to them on a silver plate?

 

[NikeWings]

A subtle reminder from Elon has arrived......a double dose of 9.0 awesomeness installing live.
I'm grinning this weekend and no short is getting under my skin.

 

[Artful Dodger]

Writing this as I am about to sell my ICE car today and will never return!

Hi Alex. Great move, well done! Since the Model 3 is still likely 3-6 months from a European launch, what will you get until you reservation can be filled? Cheers!

 

[RoadsterPlease]

Just imagine the next tweet is:

"Funding secured. Going private at 420 after all."

I am staying long.

Have a great weekend everyone!

 

[Xpert]

I am having fun with connecting the dots here for the weekend after a stressful week. This would explain why Elon insisted on being right for saying "Funding Secured" even after being forced to settle with the SEC because it is now secured. Let me know what you think of my crazy theory. Maybe there is light at the end of the tunnel, we will find out in less than 2 weeks!

The case: Tesla strikes a $10B deal with Saudi Arabia to build the first Gigafactory in the country. Details will be announced in less than 2 weeks.

1. Saudi wants and is investing in other energy to diversify from oil. This is a fact.
2. Saudi is executing a grand vision to build an industrial base in their country, reduce reliant on oil, and reduce unemployment rate from 13% to 7% in 12 years. they also want to build a futuristic city, Neom, a modern city with solar power and autonomous cars, among other advanced technology. This is according to MBS and people familiar with the Saudi.
3. Per Musk's blog post, they have been approaching Tesla offering them to go private for past 2 years. this fits perfectly into their plan #1 and #2
4. Musk announced funding secured on 8/13. The plan fell through because many investors cannot participate (Musk's announcement), and (possibly) Saudi wasn't ready yet with funding because it was not yet fully approved (article below) so they kept quiet.
5. (Possibly) After the failed take-private, Musk and the Saudi fund manager continued working quietly on a new feasible deal without involving going private. Instead, they have decided partner up. Saudi will provide funding and Tesla will provide technology, together they will build a brand new industry in Saudi Arabia, along with their futuristic city Neom.
6. (Possibly) On 10/18/18, 2 weeks from last Wed, funding has finally been secured, and the deal is announced. Construction will start early 2019 on GF4 (double the size of GF1, they have lots of lands and cash) which will complete in early 2021. Tesla will start building showrooms in 2019. At GF4, Tesla will be building Solar Roof, Solar Panel, Power Packs, and all 3 model S3X. Saudi will be able to sell extra solar power and tesla will sell cars to neighboring countries in the entire middle east.
7. (Possibly) More Gigafactories will be built until 2030 as needed.

Sources:

Saudi Arabia’s desire to take a big stake in Tesla Inc. TSLA -7.05% reflects its ambitious plan to build a base in the kingdom for electric-car production and diversify away from oil.

Its sovereign-wealth fund is considering raising its nearly 5% holding in Tesla, people familiar with the matter said. Discussions among Saudi officials about increasing the Public Investment Fund’s stake accelerated after Tesla Chief Executive Elon Musk last week proposed to take the car company private in a tweet, the people said.

On Monday, Mr. Musk said in a blog post that he had been in discussions with the fund since early last year about a major investment that would help Tesla go private. In recent months, executives from PIF have approached Tesla multiple times about investing in the company, the people said.

It’s unclear whether the Saudi fund is actively in talks with Mr. Musk about a plan to take the auto maker private, and whether it would have the financing available to do so. Two people familiar with PIF’s finances said they doubt there are any serious discussions under way about the fund taking a significantly larger stake in Tesla. Indeed, the fund is struggling to find ways to finance its existing commitments.

A spokesman for PIF declined to comment.

Still, a deal with Tesla would represent an extraordinary wager on technologies that compete with Saudi Arabia’s biggest generator of income: oil. Tesla’s electric vehicles, if manufactured inside the kingdom, would complement other technology investments and create a base of industry that some Saudi officials are calling the “Grand Vision” of the future, said one person familiar with the matter. Mr. Musk’s company also encompasses SolarCity, a supplier of solar panels and batteries.


Saudi Arabia has said it will build a massive solar-power generation project that would replace oil-and-gas-generated electricity and create a solar-panel and battery manufacturing hub in the Middle East. The country’s plans go beyond the solar project and electric cars. It also wants to build a city in the desert called Neom, which would be powered by renewable energy and showcase robots and driverless cars. Officials hope the plan will draw global technology investment and innovation.

Bloomberg - Are you a robot?
Update on Taking Tesla Private
Saudi Arabia Weighs Larger Tesla Stake as Part of Plan to Make Electric Cars

 

[Matias]

He is on Twitter now, keep your seat belts tight

One could create hft trading algorithm, which would monitor Elon’s twitter feed and immediately place sell order, when it notices any new post?

 

[Right_Said_Fred]

And this is the impetus, where the general perception of Tesla becoming uncool starts.
Short selling, FUD, Henry Blodget/BI etc. that´s all symptoms.
My wive is feeling the exact same, and 3 potential buyers in our neighborhood now have a change of mind.
The moment the car is no longer "en vogue" because of an UNSYMPATHETIC LEADER, is where the tides are changing.

Give us all a break with your whining. A few months ago you were cheering Elon on to go after the trolls, Spiegel in particular. And now this...

 

[NicoV]

You will still be able to drive around in your Ferrari collection in 20 years. At that time the battery of the Tesla will be gone...

Italian cars are not known for their anti-rust capabilties.

 

[Matias]

Like Charlie Munger says, the downfall of every man is the 3 L's:

Liquor, Ladies, and LEVERAGE

I thought it was fast women and slow horses?

 

[Fact Checking]

As loud as we are on this board or social media, it is the big institutional players I am worried about.

BTW., big institutional investors are often portrayed as the serious, long term players, while retail investors are in it for the quick buck and are easy to scare.

It's exactly the other way around: the majority of instituionals either have a short term horizon who try to time the market all the time, or invite in the shorts by lending out the shares. I believe @neroden quantified this in some fashion? Retail investors on the other hand tend to have a longer term investment outlook. While they are a minority of total investors, they are the "foundation" of investor support.

This is why the short trolls are here and elsewhere on social media, attacking the "story" and slandering the man behind the story, Elon.

This is also why the influx of 6 billion dollars of capital this quarter alone should scare the shorts: over 83,000 people with enough assets to buy a $50k-$150k car, the majority of them new Tesla owners who bought their first Tesla, just started experiencing that story and are realizing that the rumors are ... all true.

Many of those new owners, like many new iPhone owners did a decade ago, will see through the FUD based on first hand experience and will see how undervalued Tesla is at current price levels.