TSLA Market Action: 2018 Investor Roundtable

[RiverCard]

Basically it all came down to resale values. Since Tesla gained 26.2% on lease end vehicle disposition in the first nine months of 2017 the odds of losing anything at all are vanishingly low, explaining the massive over subscription.

What accounts for the decline from a gain of 50.7 % Moody's shows for periods ending both 9/30/16 and 12/31/16?

Isn't Moody's gain calculation based on the Auto Leasing Guide residual values? What has been Tesla's realized gains, i.e.the difference between the residual values used for the lease agreements and the prices at which returned vehicles are resold?

How is the realized gain (or loss, if any) allocated between the Titling Trust (for the benefit of ABS buyers) and Tesla?

 

[CorneliusXX]

What accounts for the decline from a gain of 50.7 % Moody's shows for periods ending both 9/30/16 and 12/31/16?

Isn't Moody's gain calculation based on the Auto Leasing Guide residual values? What has been Tesla's realized gains, i.e.the difference between the residual values used for the lease agreements and the prices at which returned vehicles are resold?

How is the realized gain (or loss, if any) allocated between the Titling Trust (for the benefit of ABS buyers) and Tesla?

While I'm no expert on US securitisations, It seems unreasonable to expect that on an individual contract level the ABS line is entitled to receive any more than the contracted RV. I would expect any gain to be received by Tesla and any loss to be reimbursed through excess spread.

 

[jbcarioca]

What accounts for the decline from a gain of 50.7 % Moody's shows for periods ending both 9/30/16 and 12/31/16?

Isn't Moody's gain calculation based on the Auto Leasing Guide residual values? What has been Tesla's realized gains, i.e.the difference between the residual values used for the lease agreements and the prices at which returned vehicles are resold?

How is the realized gain (or loss, if any) allocated between the Titling Trust (for the benefit of ABS buyers) and Tesla?

The gain or loss is from a basis of the contract residual value not anything form ALG which is not anything other than typical RVs and/or whatever ALG decides to print.
The actual calculation applies only to cars returned at contractual lease end (anything earlier is lessee's risk, anything later is proportionately lower as contractually stated.
reconditioning, sales expenses and warranty are all deducted from gains.

As fro 2016 lease terminations, those were very small numbers of 2012 and 2013 cars, a handful of early 2014 only Model S. Those huge gains are IMHO nearly meaningless because there were so few very early cars in the pool.

Moody's based it's calculations on the average Residual Value as stated in Model S and Model X leases.

All the calculations are in the Moody's assessment which can be downloaded from their site for only $250. Sadly, I cannot cut and paste. if you're serious about this their comparative chart is worth the price whether you agree with their methodology or not.
https://www.moodys.com/credit-ratings/Tesla-Auto-Lease-Trust-2018-A-credit-rating-730124727

 

[jbcarioca]

Somewhere today there was expressed concern about financing infrastructure spending during the Obama years because of increases in debt. As Paul Krugman argues, it is very important to know whether your debt is in your own currency. What matters too is who owns it. I recently took a look at the Fed's figures on this and was relieved to know most of our debt is still in the hands of US nationals, which is not a worry unless we all move to Canada due to desertification of U.S., for example. Foreign debt is in good hands, though the tradition of most of it in UK or Canadian hands is changed somewhat with the growth of the usual suspects, Japan and China. The latter, of course, is because that is essential to support our purchase of Asian products. If China calls in all the debt, what is the likely price of the dollar, the value of its holdings converted into its currency?

But these are logical arguments and assume pricing is based on supply and demand, merely logical arguments. Reality/logical dissidence is always a possibility.

Edit: Also, my logic here may be foul, I'm sinking into "extinguished mode" as we speak, but maybe its time for breakfast.

Were I examining this I would not only look at the total stock of debt, but at the purchasers proportions during the last few years.

FWIW: for stock:
Major foreign holders of U.S. treasury securities 2017 | Statistic
Looking at the makeup of US-held US debt begins to expose some serious FUD (this time real unquestionable FUD:
"Which agencies own the most Treasurys? Social Security, by a long shot. Here's the detailed breakdown as of December 31, 2016.

• Social Security (Social Security Trust Fund and Federal Disability Insurance Trust Fund) - $2.801 trillion
• Office of Personnel Management Retirement - $888 billion
• Military Retirement Fund - $670 billion
• Medicare (Federal Hospital Insurance Trust Fund, Federal Supplementary Medical Insurance Trust Fund) - $294 billion"

The Real Owner of the U.S. Debt Will Surprise You

Beginning in 2020 Social Security will turn negative as baby boomers retire in droves.
Social Security Trust Fund Cash Flows and Reserves
All the four largest domestic holders of US Treasuries turn to deficits with the next five years.

                                            MAJOR FOREIGN HOLDERS OF TREASURY SECURITIES
                                                      (in billions of dollars)
                                                    HOLDINGS 1/ AT END OF PERIOD


                                 Nov     Oct     Sep     Aug     Jul     Jun     May     Apr     Mar     Feb     Jan     Dec     Nov
Country                           2017    2017    2017    2017    2017    2017    2017    2017    2017    2017    2017    2016    2016
                               ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------

China, Mainland                 1176.6  1189.2  1180.8  1200.5  1166.0  1146.5  1102.2  1092.2  1088.1  1059.7  1051.1  1058.4  1049.3
Japan                           1084.1  1094.0  1096.0  1101.7  1113.1  1090.8  1111.3  1106.9  1120.5  1115.5  1102.5  1090.8  1108.6
Ireland                          328.7   312.4   310.6   307.0   310.8   302.5   295.8   299.9   313.9   309.1   293.7   288.2   275.2
Cayman Islands                   269.4   269.9   267.6   260.0   259.2   265.2   266.1   256.8   250.4   259.1   256.9   263.7   260.8
Brazil                           265.3   270.0   272.8   273.6   271.9   269.7   269.7   267.7   259.5   257.7   257.7   259.2   258.3
Switzerland                      250.9   254.0   254.9   248.3   244.8   244.5   239.5   234.1   227.8   236.4   224.0   230.0   230.3
United Kingdom                   237.9   225.9   237.4   225.4   229.7   237.1   234.4   231.5   228.3   218.3   214.1   217.2   215.8
Luxembourg                       218.3   217.9   213.9   213.3   213.0   211.7   207.7   212.1   218.3   217.8   218.9   224.3   222.4
Hong Kong                        194.9   192.3   194.7   197.3   199.1   202.6   196.3   196.6   195.1   197.8   189.4   191.4   185.5
Taiwan                           179.9   181.7   183.9   180.4   182.5   184.4   181.2   185.6   183.8   183.6   183.6   189.3   183.1
Saudi Arabia                     149.0   145.2   136.7   137.9   142.5   142.8   134.0   126.8   124.5   116.7   112.3   102.8   100.1
India                            140.8   141.4   145.1   138.9   135.7   130.3   127.3   124.1   117.1   112.3   113.7   118.2   118.7
Singapore                        124.2   130.4   125.2   119.3   112.3   106.4   107.9   107.0   103.1   107.4   103.3   102.2    96.9
Belgium                          115.3   116.0   104.8    96.9    99.4    98.3    98.7    96.4   109.9   105.7   112.2   120.4   113.5
Russia                           105.7   105.0   103.9   105.4   103.1   102.9   108.7   104.9    99.8    86.3    86.2    86.1    86.6
Korea                             98.5   100.1    94.3    95.0    97.9    96.8   100.1    93.8    97.1    96.9    95.6    93.2    85.0
Canada                            82.6    78.2    75.1    73.6    75.7    76.6    80.2    80.6    77.6    82.0    79.9    83.0    81.2
France                            74.9    75.9    75.4    76.1    80.0    72.3    74.4    66.9    69.9    64.4    60.8    61.4    68.4
Germany                           71.6    72.9    74.9    73.0    73.3    68.4    68.3    74.7    77.0    73.1    71.6    82.3    87.0
Thailand                          68.0    68.4    70.8    71.6    67.2    66.1    66.5    69.7    69.3    71.4    72.9    66.0    71.1
Bermuda                           64.0    63.5    62.6    62.7    61.7    60.9    60.9    59.4    59.7    61.4    61.6    64.1    66.8
Turkey                            61.2    61.4    60.8    57.7    54.5    58.9    49.5    56.4    59.0    58.3    58.4    59.1    55.8
United Arab Emirates              58.2    57.7    54.3    55.9    59.9    58.9    60.5    60.6    63.0    61.7    61.2    60.6    63.0
Norway                            55.3    60.6    64.1    58.0    54.8    53.8    48.3    51.4    48.9    45.8    43.1    52.5    47.7
Netherlands                       47.6    45.1    47.5    50.3    50.5    53.1    52.2    49.1    51.2    52.8    54.2    57.4    54.2
Sweden                            44.7    45.3    45.9    44.3    42.7    40.5    40.8    41.1    40.6    39.1    38.2    38.7    39.2
Australia                         40.6    38.7    36.9    37.8    37.9    38.1    37.0    35.2    37.6    34.6    36.9    34.6    36.4
Mexico                            40.6    41.6    40.5    34.7    35.8    32.3    38.9    40.2    38.8    49.5    48.1    47.1    47.1
Poland                            38.4    38.8    37.3    36.3    35.6    34.1    35.0    33.9    34.9    34.2    34.3    34.0    33.9
Kuwait                            36.8    39.4    38.0    35.6    33.0    31.8    31.6    31.3    32.4    29.8    29.4    28.7    29.4
Spain                             36.2    36.9    38.1    38.2    38.2    36.6    38.2    38.6    38.0    37.7    37.7    38.3    38.4
Philippines                       35.8    36.4    35.5    36.3    38.1    37.9    38.2    38.1    36.6    36.9    36.5    38.5    37.8
Italy                             35.6    34.5    35.3    35.4    36.2    36.1    35.6    35.0    35.2    37.5    38.2    39.9    37.8
Israel                            30.9    32.7    32.5    31.8    30.4    30.9    30.9    29.5    29.6    30.2    30.9    31.6    29.5
All Other                        480.6   476.2   475.2   458.6   463.9   451.6   455.7   445.5   442.3   439.3   444.2   453.3   438.0
Grand Total                     6343.1  6349.5  6323.0  6268.4  6250.3  6171.6  6123.6  6073.7  6079.1  6020.0  5953.0  6006.3  5953.0

Of which:
 For. Official                  4056.1  4079.1  4070.4  4051.7  4034.5  3995.3  3935.2  3911.6  3879.9  3816.1  3785.5  3814.1  3768.2
  Treasury Bills                 339.6   332.2   325.2   324.1   330.6   330.5   329.3   326.5   317.8   302.4   301.1   298.4   295.6
  T-Bonds & Notes               3716.5  3746.9  3745.2  3727.6  3703.9  3664.9  3605.9  3585.1  3562.2  3513.7  3484.4  3515.8  3472.7

Department of the Treasury/Federal Reserve Board
January 17, 2018

1/ The data in this table are collected primarily from U.S.-based custodians and broker-dealers. Since U.S. securities held in
overseas custody accounts may not be attributed to the actual owners, the data may not provide a precise accounting of
individual country ownership of Treasury securities
(see TIC FAQ #7 at: Frequently Asked Questions Regarding the TIC System and TIC Data).

Estimated foreign holdings of U.S. Treasury marketable and non-marketable bills, bonds, and notes reported under the Treasury
International Capital (TIC) reporting system are based on monthly data on holdings of Treasury bonds and notes
as reported on TIC Form SLT, Aggregate Holdings of Long-Term Securities by U.S. and Foreign Residents
and on TIC Form BL2, Report of Customers' U.S. Dollar Liabilities to Foreign Residents.


The chart above shows who we must expect to pick up the slack as federal deficits rise and teh big national pension plans turn to deficits.
Oops: who's been dissing China? and others.
Then during the last year major efforts by multilateral trade agreements have yielded domination of trade accounts in currencies other than the US$.
Some countries high on the list seriously are trying to decrease US treasury risk although everyone so doing is doing so very quietly.

However one makes this analysis one can only conclude that Secretary Mnuchin was using substances legally obtained in several state in violation of US law when he stated that the US$ "...is and will remain the primary reserve currency of the world". We should hope so, but there is going to be a rising rate environment for the next few years regardless of how that turns out. Deficits must be paid for.

• All other retirement funds - $304 billion
• Cash on hand to fund federal government operations - $580 billion.

 

[Intl Professor]

Beginning in 2020 Social Security will turn negative as baby boomers retire in droves.
Social Security Trust Fund Cash Flows and Reserves
All the four largest domestic holders of US Treasuries turn to deficits with the next five years.

This worried me at first that Ryan may well try to reduce benefits. But looking at the tables, it seems for SS at least, there is not a problem until 2032 because of interest income. Of course some action needed, I would advocate soaking you rich guys by increasing the limit on what income is actually taxed.

 

[Reciprocity]

Were I examining this I would not only look at the total stock of debt, but at the purchasers proportions during the last few years.

FWIW: for stock:
Major foreign holders of U.S. treasury securities 2017 | Statistic
Looking at the makeup of US-held US debt begins to expose some serious FUD (this time real unquestionable FUD:
"Which agencies own the most Treasurys? Social Security, by a long shot. Here's the detailed breakdown as of December 31, 2016.

• Social Security (Social Security Trust Fund and Federal Disability Insurance Trust Fund) - $2.801 trillion
• Office of Personnel Management Retirement - $888 billion
• Military Retirement Fund - $670 billion
• Medicare (Federal Hospital Insurance Trust Fund, Federal Supplementary Medical Insurance Trust Fund) - $294 billion"

The Real Owner of the U.S. Debt Will Surprise You

Beginning in 2020 Social Security will turn negative as baby boomers retire in droves.
Social Security Trust Fund Cash Flows and Reserves
All the four largest domestic holders of US Treasuries turn to deficits with the next five years.

                                            MAJOR FOREIGN HOLDERS OF TREASURY SECURITIES
                                                      (in billions of dollars)
                                                    HOLDINGS 1/ AT END OF PERIOD


                                 Nov     Oct     Sep     Aug     Jul     Jun     May     Apr     Mar     Feb     Jan     Dec     Nov
Country                           2017    2017    2017    2017    2017    2017    2017    2017    2017    2017    2017    2016    2016
                               ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------

China, Mainland                 1176.6  1189.2  1180.8  1200.5  1166.0  1146.5  1102.2  1092.2  1088.1  1059.7  1051.1  1058.4  1049.3
Japan                           1084.1  1094.0  1096.0  1101.7  1113.1  1090.8  1111.3  1106.9  1120.5  1115.5  1102.5  1090.8  1108.6
Ireland                          328.7   312.4   310.6   307.0   310.8   302.5   295.8   299.9   313.9   309.1   293.7   288.2   275.2
Cayman Islands                   269.4   269.9   267.6   260.0   259.2   265.2   266.1   256.8   250.4   259.1   256.9   263.7   260.8
Brazil                           265.3   270.0   272.8   273.6   271.9   269.7   269.7   267.7   259.5   257.7   257.7   259.2   258.3
Switzerland                      250.9   254.0   254.9   248.3   244.8   244.5   239.5   234.1   227.8   236.4   224.0   230.0   230.3
United Kingdom                   237.9   225.9   237.4   225.4   229.7   237.1   234.4   231.5   228.3   218.3   214.1   217.2   215.8
Luxembourg                       218.3   217.9   213.9   213.3   213.0   211.7   207.7   212.1   218.3   217.8   218.9   224.3   222.4
Hong Kong                        194.9   192.3   194.7   197.3   199.1   202.6   196.3   196.6   195.1   197.8   189.4   191.4   185.5
Taiwan                           179.9   181.7   183.9   180.4   182.5   184.4   181.2   185.6   183.8   183.6   183.6   189.3   183.1
Saudi Arabia                     149.0   145.2   136.7   137.9   142.5   142.8   134.0   126.8   124.5   116.7   112.3   102.8   100.1
India                            140.8   141.4   145.1   138.9   135.7   130.3   127.3   124.1   117.1   112.3   113.7   118.2   118.7
Singapore                        124.2   130.4   125.2   119.3   112.3   106.4   107.9   107.0   103.1   107.4   103.3   102.2    96.9
Belgium                          115.3   116.0   104.8    96.9    99.4    98.3    98.7    96.4   109.9   105.7   112.2   120.4   113.5
Russia                           105.7   105.0   103.9   105.4   103.1   102.9   108.7   104.9    99.8    86.3    86.2    86.1    86.6
Korea                             98.5   100.1    94.3    95.0    97.9    96.8   100.1    93.8    97.1    96.9    95.6    93.2    85.0
Canada                            82.6    78.2    75.1    73.6    75.7    76.6    80.2    80.6    77.6    82.0    79.9    83.0    81.2
France                            74.9    75.9    75.4    76.1    80.0    72.3    74.4    66.9    69.9    64.4    60.8    61.4    68.4
Germany                           71.6    72.9    74.9    73.0    73.3    68.4    68.3    74.7    77.0    73.1    71.6    82.3    87.0
Thailand                          68.0    68.4    70.8    71.6    67.2    66.1    66.5    69.7    69.3    71.4    72.9    66.0    71.1
Bermuda                           64.0    63.5    62.6    62.7    61.7    60.9    60.9    59.4    59.7    61.4    61.6    64.1    66.8
Turkey                            61.2    61.4    60.8    57.7    54.5    58.9    49.5    56.4    59.0    58.3    58.4    59.1    55.8
United Arab Emirates              58.2    57.7    54.3    55.9    59.9    58.9    60.5    60.6    63.0    61.7    61.2    60.6    63.0
Norway                            55.3    60.6    64.1    58.0    54.8    53.8    48.3    51.4    48.9    45.8    43.1    52.5    47.7
Netherlands                       47.6    45.1    47.5    50.3    50.5    53.1    52.2    49.1    51.2    52.8    54.2    57.4    54.2
Sweden                            44.7    45.3    45.9    44.3    42.7    40.5    40.8    41.1    40.6    39.1    38.2    38.7    39.2
Australia                         40.6    38.7    36.9    37.8    37.9    38.1    37.0    35.2    37.6    34.6    36.9    34.6    36.4
Mexico                            40.6    41.6    40.5    34.7    35.8    32.3    38.9    40.2    38.8    49.5    48.1    47.1    47.1
Poland                            38.4    38.8    37.3    36.3    35.6    34.1    35.0    33.9    34.9    34.2    34.3    34.0    33.9
Kuwait                            36.8    39.4    38.0    35.6    33.0    31.8    31.6    31.3    32.4    29.8    29.4    28.7    29.4
Spain                             36.2    36.9    38.1    38.2    38.2    36.6    38.2    38.6    38.0    37.7    37.7    38.3    38.4
Philippines                       35.8    36.4    35.5    36.3    38.1    37.9    38.2    38.1    36.6    36.9    36.5    38.5    37.8
Italy                             35.6    34.5    35.3    35.4    36.2    36.1    35.6    35.0    35.2    37.5    38.2    39.9    37.8
Israel                            30.9    32.7    32.5    31.8    30.4    30.9    30.9    29.5    29.6    30.2    30.9    31.6    29.5
All Other                        480.6   476.2   475.2   458.6   463.9   451.6   455.7   445.5   442.3   439.3   444.2   453.3   438.0
Grand Total                     6343.1  6349.5  6323.0  6268.4  6250.3  6171.6  6123.6  6073.7  6079.1  6020.0  5953.0  6006.3  5953.0

Of which:
 For. Official                  4056.1  4079.1  4070.4  4051.7  4034.5  3995.3  3935.2  3911.6  3879.9  3816.1  3785.5  3814.1  3768.2
  Treasury Bills                 339.6   332.2   325.2   324.1   330.6   330.5   329.3   326.5   317.8   302.4   301.1   298.4   295.6
  T-Bonds & Notes               3716.5  3746.9  3745.2  3727.6  3703.9  3664.9  3605.9  3585.1  3562.2  3513.7  3484.4  3515.8  3472.7

Department of the Treasury/Federal Reserve Board
January 17, 2018

1/ The data in this table are collected primarily from U.S.-based custodians and broker-dealers. Since U.S. securities held in
overseas custody accounts may not be attributed to the actual owners, the data may not provide a precise accounting of
individual country ownership of Treasury securities
(see TIC FAQ #7 at: Frequently Asked Questions Regarding the TIC System and TIC Data).

Estimated foreign holdings of U.S. Treasury marketable and non-marketable bills, bonds, and notes reported under the Treasury
International Capital (TIC) reporting system are based on monthly data on holdings of Treasury bonds and notes
as reported on TIC Form SLT, Aggregate Holdings of Long-Term Securities by U.S. and Foreign Residents
and on TIC Form BL2, Report of Customers' U.S. Dollar Liabilities to Foreign Residents.


The chart above shows who we must expect to pick up the slack as federal deficits rise and teh big national pension plans turn to deficits.
Oops: who's been dissing China? and others.
Then during the last year major efforts by multilateral trade agreements have yielded domination of trade accounts in currencies other than the US$.
Some countries high on the list seriously are trying to decrease US treasury risk although everyone so doing is doing so very quietly.

However one makes this analysis one can only conclude that Secretary Mnuchin was using substances legally obtained in several state in violation of US law when he stated that the US$ "...is and will remain the primary reserve currency of the world". We should hope so, but there is going to be a rising rate environment for the next few years regardless of how that turns out. Deficits must be paid for.

• All other retirement funds - $304 billion
• Cash on hand to fund federal government operations - $580 billion.

Who owns more US debt then all foreign countries combined?

 

[Off Shore]

Um, market?

 

[JRP3]

It's closed, no action.

 

[Causalien]

I must be getting mixed up. I thought IB was the firm that was founded specifically to avoid front-running? If not, which one is it?

I must be getting mixed up. I thought IB was the firm that was founded specifically to avoid front-running? If not, which one is it?

You're welcome.

Since you live in Chicagoland, you may want to take advantage of one of the educational programs at the CBOE.

Link: Options Education Center - Cboe

I began trading options in 1982. I did not do well at first.

During the nineties I visited the CBOE almost every trading day to interview CBOE market makers/traders for my TV show. Since I had a pass key, I often ate lunch in the CBOE traders' lounge and learned much from those professionals.

Twice I attended the CBOE's full-day class of instruction. For financial journalists this was complementary. Both of those days ended with a mock trading session in a pit at the CBOE. One of my regular interviewees, Jon Najarian, conducted those sessions. He is now a regular on CNBC.

The classes and mock trading were most worthwhile. Nowadays when I do trade options I almost always profit. But most retail investors do not, while established market makers do. That should explain why CBOE market makers/traders are willing pay a hefty price for their seats.

So the definitive answer is this.

IB has the ability to front run their customers. Part of it is the right you signed away on your margin account so that they can lend your shares and better offset risk.

I forgot where I found the research. But it was on HFT when one of them caused a flash crash with the first recorded use of spoofing.

The research went into tick by tick replay of how it happened and discussed what kind of structure allows a brokerage to front run customers and spoof as well.

If I remember correctly, Charles schwab is one of the ones that cannot do this. In general, any brokerage that allows smart routing is basically front running you. Smart routing is basically asking for it.

But in a sense. Since there are so many HFt doing front running and spoofing now, I believe the benefit for them fron these activities are close to zero. The most they might get is a cent or two, which for most retail investors who's trading at the fastest is in the 5 second interval, is negligible. Especially so if you buy and hold more than a day.

Disclaimer: all anecdotal evidence of course. I tend not to save links to researches because there are too many and just incorporate it to my knowledge. If anyone wants to rebut me by askibg for proof, I have none and I am not in the business of proving my theory so that others can make money competing against me.

 

[ggr]

Mod: I created a thread for investor political discussion. Moved a bunch of posts there. Apologies if I missed any or took ones that should have stayed. No more in the market action thread please. --ggr.

 

[madodel]

It's closed, no action.

But it is open tomorrow and no one is talking about what to expect. Granted the news will lead with the results of the Super Bowl so maybe the lunacy of the past week will be forgotten.

 

[bdy0627]

My guess is another red day tomorrow followed by a bounce on Tuesday. I would be careful about buying on any morning dip tomorrow due to the macro situation.

 

[jbcarioca]

Who owns more US debt then all foreign countries combined?

As I noted, we all know that the largest current holders are US pension plans, all of which turn to net sellers within the next two years. That is why I prefer to look at flows rather than stock. Stock dies not influence liquidity, flows do. Presently the flows are from China, Japan etc to US Treasuries. Conventional US-centric opinion suggests they would never dare sell US Treasuries nor reduce buying, since they are so heavily exposed.

We must keep in mind that global trade is increasingly denominated in non-US currencies, thus increasing demand for other currencies. Brazil, fifth or so in stock, is illustrative. The China-Metcosur agreements and Mercosur-EU plus Mercosur-Mexico and TPP- Mercosur (pending) in addition to bi-laterals are all leading to increase Euro, Yen and Yuan holdings thus decrease of US$.

Complacency in the US has many people ignoring the rapid decline in US global economic influence. This is perfectly analogous to GM in 1955 thinking the market share dominance would continue. The same complacency was with the British Empire, the Romans and others before them. History does have valuable lessons.

Please think about flows and trade patterns rather than only stock.

I don’t wish to be unkind or rude. I do want to point out that the US has entered a largely self-inflicted period of secular decline.

 

[Manton]

My guess is another red day tomorrow followed by a bounce on Tuesday. I would be careful about buying on any morning dip tomorrow due to the macro situation.

Friday after close there was news of Model 3 tare down concluding "same shotty quality as Kia in 90's" I presume that'll get pushed pretty hard on Monday to get to $336 resistance point.

 

[elasalle]

Friday after close there was news of Model 3 tare down concluding "same shotty quality as Kia in 90's" I presume that'll get pushed pretty hard on Monday to get to $336 resistance point.

That's not news, thats FUD on Jalopnik. 1st step should be to learn to distinguish between the 2

 

[bdy0627]

That's not news, thats FUD on Jalopnik. 1st step should be to learn to distinguish between the 2

Yep, that's not news.

 

[bdy0627]

I think the macro picture will drive the action tomorrow.

 

[elasalle]

Labor offers solar panels and Tesla batteries for 50,000 South Australia homes

A network of at least 50,000 home solar systems backed up by battery storage will create the world’s largest “virtual” power plant to cut energy bills, Jay Weatherillhas said.

The South Australian premier said a trial was already under way to install solar panels and Tesla batteries on 1,100 Housing Trust homes. The cost would be financed by the sale of electricity. The power generated by the solar panels and the batteries would not be owned directly by the households.

 

[Starno]

Should a downturn occur, I believe that Tesla will still continue to see considerable demand for its products, because relatively wealthy people and members of the high-skill labor force will still have money to spend.

One risk that I haven't seen discussed is the effect on parts suppliers. Remember that back in 2008, the U.S. government bailout of the automakers had as much to do with shoring up suppliers as keeping GM and Chrysler from going away completely. If a recession were to hit, and cause major loss of demand for automobiles generally, some suppliers might fail. This could potentially have some effect on Tesla if one of their suppliers suddenly can't deliver enough parts.

On the flip side, Tesla has demonstrated a willingness to bring components production in-house when they feel that a supplier isn't up to its standards. Tesla has also purchased assets (most notably the NUMMI facility) when bargains are to be found. In a recession where a small supplier is struggling, a buyout is a possibility.

They will have money to spend. But they might delay their purchase, that's what I'm afraid of.
When a severe economic downturn arise, even people who still have money, prefer to save it : either they have a job but they're afraid to lose it, or get their paycheck to be cut by a lot. Or they might have a firm that see their revenues cut by a lot.

We might have a 30%+ decline in demand, I hope Tesla can survive it

-------------------

 

[defc0n]

I think the macro picture will drive the action tomorrow.

Probably not good for macro:

Yellen Says Prices `High' for Stocks, Commercial Real Estate