Sanrith Descartes
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Investing General Discussion
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Guest, it's time once again for the massively important and exciting FoH Asshat Tournament!
Go here and give us your nominations!Who's been the biggest Asshat in the last year? Give us your worst ones!
Gravel
Mr. Poopybutthole
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US markets will close for extenuating circumstances as well. Basically, no one wants a Black Friday type event again. The thinking being that if you can avoid the initial panic, by shutting the markets down, you can avoid the giant drop and inevitable bounce back. Basically, a protection against people freaking out short term.
Blazin
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Big Phoenix
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Blazin
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Perfect Storm. Major institutional investors finally drinking the kool aid. Large institutions and funds always acting as a herd, the china plant opening was the final straw for the holdouts. It continues to be one of the most shorted stocks on the street by major hedge funds whose thesis has just been blown out. First they said they would run out of money, then they said he won't be able to scale production, then that there would be no demand after subsidies. It was repeated over and over that the other automakers would be competitive in the EV market and instead they have been slow to market, overpriced and under performing.. All those fears have been lessened and they have resisted taking a position in this for years. Now all at once they are pouring in.
This likely won't end well but stepping in front of it would be fool hardy. Investors are imagining a company that could be worth a trillion this decade, if they are right then it has a long way to go. But it is a bet on Elon to delivery new products and revenue lines well beyond EVs. Once it tops it will likely give back the final 30% or so, there are alot of long term holders of this stock that are so die hard you could never get them to sell it's their hope in the future.
Look at Qualcomm in 1999, this has happened before and the mania will stop at some point (bitcoin 2017 another example).
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Blazin
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A 10x on a call is nice but not rare, just impressive the number of contracts. The calls are out of money stil,l the serious gains to be had come if they go into the money.
If the holder doesn’t dump them and Tesla fails to close above $1000 on 3/20 the trade goes from $900k profit to a $100k loss. I would have taken the money and ran the near term top may have been Put in yesterday it would be painful watching that gain erode.
If the holder doesn’t dump them and Tesla fails to close above $1000 on 3/20 the trade goes from $900k profit to a $100k loss. I would have taken the money and ran the near term top may have been Put in yesterday it would be painful watching that gain erode.
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TJT
Mr. Poopybutthole
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I worked at General Motors for like 6 years in the finance department.Tesla is one investment I have always steered clear of. I guess I am missing out in that regard but I tend to only go long on investments so whatever.
I can tell you with certainty that EVs were pet projects within the big three at best. The Chevy Volt was our rockstar EV for a time but the infrastructure investments required to make them feasible weren't worth it at all to compared to our other lines. Once they realized the cost of building that out they pretty much bailed. Electric cars are just a small market. Plain and simple. To make them a bigger market you would need a system of convenience as widespread as regular gas stations.
Tesla needs to make a lot of money on a lot of shit and that just hasn't happened. I think people don't really realize the kind of investment into Tesla needed to make that materialize. Auto manufacture is unbelievably expensive. I always like to bring up that the robot arm that puts on windshields at GM (and nothing else) cost GM around $75M to develop. Just that singular robotic system. And that was just the R&D to get the proof of concept working like 30 years ago.
I can tell you with certainty that EVs were pet projects within the big three at best. The Chevy Volt was our rockstar EV for a time but the infrastructure investments required to make them feasible weren't worth it at all to compared to our other lines. Once they realized the cost of building that out they pretty much bailed. Electric cars are just a small market. Plain and simple. To make them a bigger market you would need a system of convenience as widespread as regular gas stations.
Tesla needs to make a lot of money on a lot of shit and that just hasn't happened. I think people don't really realize the kind of investment into Tesla needed to make that materialize. Auto manufacture is unbelievably expensive. I always like to bring up that the robot arm that puts on windshields at GM (and nothing else) cost GM around $75M to develop. Just that singular robotic system. And that was just the R&D to get the proof of concept working like 30 years ago.
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Blazin
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You’re pretty much summarizing why people doubted Tesla from the beginning. That a major auto manufacturer could be built from scratch was highly doubted . The first hurdle is over, but you are right there is a long way to go. 500k units a year is a far cry from 17m.
The surprise for me has been how flat footed and sad the response of big auto makers have been. They are years behind and the market is now beginning to price in that they are going to have a hard time catching up. The tides have changed.
look at Ford’s garbage earnings report yesterday. Declining business next to a rapidly innovative first mover.
Tesla has to keep winning this entire decade and keep pushing not giving them a chance to catch up. I’m excited to see what the auto industry looks like in 2030
The surprise for me has been how flat footed and sad the response of big auto makers have been. They are years behind and the market is now beginning to price in that they are going to have a hard time catching up. The tides have changed.
look at Ford’s garbage earnings report yesterday. Declining business next to a rapidly innovative first mover.
Tesla has to keep winning this entire decade and keep pushing not giving them a chance to catch up. I’m excited to see what the auto industry looks like in 2030
Blazin
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TJT
Mr. Poopybutthole
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I still don't think that's going to be the case. Just because EVs are always going to be competing with regular cars. To the person who doesn't particularly care about the supposed benefits of driving an electric car it's just inefficient. You're looking at spending $35k or $20k for a low end EV or a medium range sedan respectively. The EV can't go long distances and if it can you need to explicitly plan your routes along where charging stations exist. Charging takes much longer than filling the gas tank.
Why would the big autos tool up to compete in that space? If Tesla is able to start building our a nationwide system of those hot swap battery stations like they theorized a few years ago then maybe the big autos will. They've proven they can certainly make competing products... but why?
Sanrith Descartes
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I think a big driver (no pun) on the difference between Tesla and the big 3 is Elon owns so much of Tesla he is a singular voice in leadership. The big 3 have CEO and Officers who are driven to focus one business cycle out to try ro maximize their personal gains via options etc (and not getting fired). For better or worse, Elon says "fuck it, we are doing xyz". Harder for a GM CEO to say "we are gonna burn mountains of cash for a payoff a decade or two from now when ICE engines may be dead weight".
Khane
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The evolution of EVs is interesting to watch. And what's especially interesting to me personally is that all the drawbacks of an EV right now are likely going to be their greatest boon in the future if the tech keeps moving forward instead of being orphaned and abandoned (yet again). Convenience, as TJT pointed out, is the most limiting factor in bringing EVs to a wider audience and gaining mass appeal.
But the possibilities of EV conveniences are much higher than a traditional ICE vehicle. Right now you have to plug a car in and it takes much longer to charge the battery than it does to fill a gas tank. But wireless electricity is a thing already and solar tech can be free fuel even while driving someday. The implications of battery tech that would allow an EV to perform better and be more convenient than an ICE are also far reaching and not tied to the auto industry alone. That's one of the other reasons Tesla looks so good as investment to so many people. Tesla isn't just an auto manufacturer, it's also a clean energy company.
But the possibilities of EV conveniences are much higher than a traditional ICE vehicle. Right now you have to plug a car in and it takes much longer to charge the battery than it does to fill a gas tank. But wireless electricity is a thing already and solar tech can be free fuel even while driving someday. The implications of battery tech that would allow an EV to perform better and be more convenient than an ICE are also far reaching and not tied to the auto industry alone. That's one of the other reasons Tesla looks so good as investment to so many people. Tesla isn't just an auto manufacturer, it's also a clean energy company.
Sanrith Descartes
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As someone who moved from Miami to NY with an EV, I can tell you that a big challenge is dealing with cold weather environs. Using a heater is brutal on range as is preheating. When range gets upwards of 500 or 1000 miles it wont be an issue. But now, losing 25-40% of range because it is 30 degrees out is a major thing.
Asshat wormie
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It was more the balls to dump 125k into near term calls that was impressive to me.
Blazin
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Yeah normally the crazy wins is someone buying deep out of the money calls for pennies. This person dumped serious money in, and not played right will turn into a loss. THey are now only worth $200k.
I'll probably sell a few puts on TSLA next few days as the crash back to earth settles. Implied volatility is so juicy hard to pass up