TSLA Market Action: 2018 Investor Roundtable

[winfield100]

spacex 2 day right now

 

[Intl Professor]

OT



The epidemic of deaths in and around cars led to the government regulation.

National Traffic and Motor Vehicle Safety Act - Wikipedia
Drunk driving in the United States - Wikipedia
Tetraethyllead - Wikipedia

I'm glad we don't live in the unregulated world. It would be nice if we could make the regulations shorter and sweeter, and with current technology we probably can. For instance, nowadays we could simplify a lot of the regulations to:
-- no driving with any detectable alcohol level in your blood
-- no fuel-burning cars at all
-- cars must have sensors to detect things in front of them and must safely stop rather than crashing into things

There's always a tension between self-interest and the public good or the moral act. Using my terminology in teaching Madison's introduction to Federalist #51, it is the conflict between freedom and order. Freedom in the abstract is inherently anti-civilization or anarchy. It is aesthetically pleasing to some anarchists. If I remember correctly it was Bakunin who said, "no matter the violence of the act, it is beautiful." The polar opposite is certainty, an excess of order, like death, and the end of humanity. Examples include the death camps of Hitler's "final solution" or Stalin's gulags or the U.S. commander's honesty in saying about Vietnam "we had to destroy that village in order to save it."

To act impeccably one must have selfish vision that is long term and short term vision in the direction of the long term. Then the problem of change approaches the future with confidence. Or, put another way, our selfish natures are tricked into the moral act by focus on the long run.

Thus as a long it is easy to invest in Tesla. But I have no more dry powder and applying these principles in personal life is a bit more complicated. You know, "nostalgia isn't what it used to be," when we were young.

Edit: Cons are short termers. In politics we call them opportunists, in business writ large, they are embezzlers, in investing they are called malicious shorts. Their goal is disruption for destruction not construction or evolution into a better future though they may say so, reminding us they are cons.

 

[winfield100]

spacex 2 day right now

WHOOHOO!!!! sucessful seperation, next launch 1/7/2019 Iridium

 

[Silent Ludicrosy]

When I was growing up my grandfather gave me 10 OIL company stock certificates in my christmas stocking.
They were absolutely gorgeous and not worth the paper they were printed on. They went to 0 in 1927.
Was fun tracking down their value. No internet back then.

Not as elegant, but more fun if they like rollercoasters.

 

[Mader Levap]

It would be nice if car companies could make the cars they see fit to make and how they wish to make them without millions of pages of government regulation.

No, having chinese-style deathboxes would not be nice, "free market" deranged delusions notwithstanding.

 

[Intl Professor]

Think of the Bible, the Koran, the Bhagavad Gita, Shakespeare, Goethe, millions of pages of "code" for behavior. Anarchists are anti-code, dammit! Decoding is not uncoding. And the reverse is also true.

 

[Thumper]

Never toss those old oil stocks.

 

[dc_h]

Million pages of regulation thanks but no thanks.

I would rather have free people make informed decisions.

IF Ford wants to make cool unsafe cars let them.

IF Volvo wants to make uncool safe cars let them.

Publish safety, vehicle death etc data.

Charge a pollution tax so cost aren't transferred to the public square.

Charge a War tax on gasoline/diesel that pays to protect the free flow of oil from the Persian Gulf and through the Suez Canal.

Let consumers buy what they wish.

When a company goes bankrupt let them die.

When people have good information with the correct price signals they make better decisions.


BTW It is millions of pages of regulations that is keeping Elon from

selling Teslas in Michigan, South Carolina, and New Mexico.

replacing side mirrors with much more effective,safer,and efficient rear view cameras.

and will likely keep safer autonomous vehicles or AV systems from the public for years and maybe decades.

OT weekend
I agree with most of your concepts, but we don’t live in a free market. At best, we live in an oligarchy of production and often information. Without our Tesla forum we would be forced to read all Tesla updates with a boilerplate about Elon is erratic. The internet can inform, it to date has weaponized disinformation on a global scale. Maybe incentives for more transparency is possible, but free markets tend to end in an oligarchy at best. Maintaining balance between free markets with restraints balances the power demands of governments and businesses and consumers, in a healthy political environment. A good partisan fight for ascendency keeps each side fresh and forces each constituency to find effective leadership and redefine their message for each new generation.

 

[dc_h]

Note that "fiduciary duties" are interpreted pretty narrowly when it comes to running public companies, because shareholders always have the option to overrule executives and there's usually annual shareholder meetings where shareholders can exercise their control over the company if they disagree with the direction.



The problem is, there's no such thing as 'EV versions of popular models', in reality Teslas only look like regular cars, there's surprisingly little technology overlap. An ICE car has thousands of moving parts, a Tesla less than a few dozen, including doors, windows and motorized seats.

You cannot just 'convert' an ICE factory to making EVs. What you have to do is to build entirely new factories, using a technology that is in large part alien to you.

No wonder ICE carmakers are not rushing to do this - they are used to building out maybe 5% of new capacity per year and 'transition' their factories after a good 10 years of draining all the profits from existing production lines.

The EV transition is disrupting those capital expenditure practices and plans, and I question whether many of the car OEMs are actually financially able to perform this transition - or are already set on a path of steady decline.

GE matched all the way to the abyss before firing their CEO and cutting dividends to rebuild their business. What are the odds of auto execs not waiting as long as possible? Mary Barra made her first stab at the transition and got burned. She’ll be more reluctant to touch the stove next time. Ford appears exited to borrow from VW, which could be a Trojan horse to give VW cheap access to a legendary American brand on the cheap in 2021 after the Y kills Fords SUV/CUV business and comes out with an F150 alternative. Rivian seems able to take away some high end of the truck market as well. Take 200,000 trucks off the top of the truck market and profits are gone for at least one loser.

 

[bhtooefr]

Sure, as long as they're not allowed to drive the unsafe cars on the public roads, which are the public property of all the people, managed by the government on our behalf, and devoted to the public good of transportation.

Unsafe cars on the public roads were and are killing passengers, pedestrians, bicyclists, and drivers of other cars -- people who chose NOT to buy the unsafe cars. Not OK.

And in fact, cool unsafe cars ARE legal as long as you only drive them on private property which you own. As it should be! There are unsafe car rallies out in the Arizona desert every few years, featuring insane rocket cars and stuff.

Also, part of this is to ensure a minimum level of safety for the occupants of the cars, as well.

In an ideal world, everyone would have the money to buy whatever safety level they wanted.

Here in the real world, a lot of people buy whatever's cheapest, and run it until it stops running. Having a minimum standard of safety (that depreciates quickly, as it does in the real world) means that people can afford safer cars after they've filtered to the bottom-tier markets. That's the same reason fleet efficiency regulations make sense (in addition to carbon taxation), to incentivize manufacturers to continue producing efficient stuff so that it's available in the used market for people who have little choice of what to buy.

 

[SO16]

Million pages of regulation thanks but no thanks.

I would rather have free people make informed decisions.

BTW It is millions of pages of regulations that is keeping Elon from

selling Teslas in Michigan, South Carolina, and New Mexico

1. Few people make “informed” decisions. Most only care about what’s cheap today and don’t think of the consequences down the road.

Humans Wired to Respond to Short-Term Problems

2. The auto companies and dealerships have LOBBIED the government to not allow direct sales in those states. In Michigan especially, the republican Joe Hune (who’s wife is a lobbyist employed by the auto industry) is the one who strengthened the state law and was signed by the republican Governor.

Sometimes the government is corrupt. The great news is that Joe Hune, Snyder and several other republican SOBs are OUT!!!!!!!

Hopefully Whitmer can correct the hypocrisy of the republicans. But I’m not holding my breath.

 

[SO16]

OT



Sure, as long as they're not allowed to drive the unsafe cars on the public roads, which are the public property of all the people, managed by the government on our behalf, and devoted to the public good of transportation.

Unsafe cars on the public roads were and are killing passengers, pedestrians, bicyclists, and drivers of other cars -- people who chose NOT to buy the unsafe cars. Not OK.

And in fact, cool unsafe cars ARE legal as long as you only drive them on private property which you own. As it should be! There are unsafe car rallies out in the Arizona desert every few years, featuring insane rocket cars and stuff.

Not only that, by having unsafe cars on the road means the injuries would be worse. Unless the person died right away, the costs for insurance (private and public) would be higher. So that means everyone would pay even more because of the idiots who wanted to buy unsafe vehicles.

 

[Artful Dodger]

WEEKEND OFF-PLANET: (Con't)

Weekend OT:

It doesn't matter: atmosphere is lost to solar wind only over geological timescales - tens of millions of years. If we can terraform Mars within thousands of years, we can keep the atmosphere replenished as well.

Also, if we are thinking "thousands of years" then a superconducting ring along the equator, generating a weak magnetic field, is probably within the technological capabilities of future humanity.

So it's very likely a non-issue.

Agreed. Any merely technical or scientific obstacle can be overcome by applying standard engineering prinicples. More to the point however, is this singular opportunity to design Martian politics before colonization begins. This is an opportunity not seen by humans since the time of Christopher Columbus, or possibly the Framers of the US Constitution.

Here's the challenge:

"The probable best way to set up a Martian society would be to ensure that it is unencumbered by the ancient geopolitical strife of Earth. In essence, Mars should be viewed as a free New World of its own, and and settlers encouraged to develop it, extract resources, produce new products, and launch business ventures in any and every way, with one caveat: Martian civilization must be designed from the ground up to be self-sustaining and long lasting, with an open immigration policy and a limiting cap placed on population decided on in advance."​

The New “New World”: Colonizing Mars – The Startup – Medium

Essentially, a Mars Colony is the ultimate startup venture. And who on Earth is more qualified for the task than serial entrepreneur billionaire genius philanthropist Elon Musk? (or his 5 sons)

Cheers!

 

[SO16]

OT

This is something I have been thinking a lot about today. The big focus of the US Government today is to build or not build a wall costing $5B on the border with Mexico.

I find it hard to believe that this is even being considered when $5B spent toward vehicle safety/efficiency, health care, education, or energy generation/storage would not have a drastically more impactful benefit.

Media coverage of immigration drastically skews the mindset of Americans (to which I am one) to make them believe that this is an efficient use of their tax dollars. Sorry to be political here, but this is another example of how Republicans fleece voters.

Some Americans need to find someone to blame for their own failings. If we just enforced the existing laws and go after the companies/people that higher illegals (like Trump), there would be much less of an incentive for illegal border crossings.

 

[dmckinstry]

Think of the Bible, the Koran, the Bhagavad Gita, Shakespeare, Goethe, millions of pages of "code" for behavior. Anarchists are anti-code, dammit! Decoding is not uncoding. And the reverse is also true.

Unfortunately most of those could be be covered by a few simple rules. Love your neighbor as yourself and do no harm. I say unfortunately, because too few can stop thinking they know what's best for others.

 

[JRP3]

Unfortunately most of those could be be covered by a few simple rules. Love your neighbor as yourself and do no harm. I say unfortunately, because too few can stop thinking they know what's best for others.

The unfortunate reality is that too many think they know what is best for themselves even after their behavior repeatedly proves otherwise.

 

[Lucky_Man]

That's true, but there's these additional factors you keep not acknowledging:

• There is now growing uncertainty about the future of ICE cars specifically - which existential uncertainty didn't exist back in 2008-2009. That gives extra reason for people to not invest ~$40k+ into an asset they expect to be using for over 7 years.
• In 2008-2009 every knew that this is a recession and that the drop in demand was temporary. Transition of customers to EVs is permanent in over 90% of the cases.
  
• There's a significantly higher and more uncertain interest rate environment today than in 2008-2009. Financing is more expensive and will probably get more expensive in the future. With over 70% of new car purchases financed this is is a significant factor.

Is the sum of these two factors as large as the economic uncertainty in 2008? Certainly not yet, we'd be seeing ICE car sales plummet otherwise.

My point is, it's a fundamentally volatile scenario, the moment ICE carmakers start the transition and start selling EVs for real they might set off a chain reaction of customer behavior they don't have control over: they'll start waiting for EVs, defer buying a new ICE car, or buy a used ICE car.

If we look at historic examples, transitions in demand for new technologies tend to be very, very quick:

Literally every transition there shifted demand by about 5% per year - 10% in the peak years. While those products had faster replacement cycles, this is counter-acted by the fact that new car purchases can realistically be delayed by 3-5 years, while for example an old smartphone becomes too painful to use with contemporary software after 2 years already.

The other problem is, premium sales are lost first, which tend to have the highest profit margin content. So in terms of lost cash flow, the first 20% of lost sales could be the most damaging, wiping out most of the positive cash flow - leaving very little to invest into the EV transition ...

This isn't hypothethical at all - U.S. sales of the BMW 3-series effectively collapsed in 2018:

BMW 3-series US car sales figures​

I believe one of the main forces behind that is competition from the Model 3: November 2018 sales were only 3,218 units versus 6,181 units in November 2017.

I think there are many companies in the ICE industry that will get into serious trouble after losing 5-10% of their most lucrative sales in a single year, permanently.

What's missing a clarification about the abuse of the term - "full employment".

They believe that when the number of people receiving unemployment insurance is low, the nation is enjoying "full employment". What they're failing [on purpose?] to realize that this insurance program is time-limited. It's only good for a short span of time, and when it runs out, you're no longer counted in that figure.

You're still unemployed, but the oft-quoted 'unemployment number' is low.

As Inigo Montoya, the Spaniard in the movie Princess Bride, said: "I do not think that word means what you think it means!"

 

[EVNow]

No, having chinese-style deathboxes would not be nice, "free market" deranged delusions notwithstanding.

Well, if you really want "no regulations" - S Sudan or one of those failing sub-Saharan countries (unfortunately) would be the right place. Somehow "no regulation" people don't like those places.

List of countries by Fragile States Index - Wikipedia

 

[STARR X]

People are often short sighted and mostly uninformed.

Or misinformed by paid media.

 

[EVNow]

Some Americans need to find someone to blame for their own failings. If we just enforced the existing laws and go after the companies/people that higher illegals (like Trump), there would be much less of an incentive for illegal border crossings.

It has nothing to do with "illegals". It is just pure racism. None of those people are concerned about "illegals" like Melania - or for that matter "Pilgrims" who came and stole from & butchered Americans.