2017 Investor Roundtable:General Discussion

[drinkerofkoolaid]

Okay. Sure the market might rally a bit more, but I find it extremely unlikely the broad market is going much higher.

At this point, stocks are rallying because of Trump's "promise" that he has a plan to fix everything, by reviving dying industries (such as coal), eliminate all oversight of banks and lending institutions, removing all government supported public works projects, doing away with everything Obama had anything to do with, and permitting companies to dump whatever they want wherever they want to reduce costs that some companies might consider "overly burdensome".

This is the narrative being pushed by the media and analysts. I seriously doubt this is how things will work out. Lawsuits by citizens and shareholders , and mass protests will prevent or delay many of the things people think Trump will do.

Note: I'm fairly sure If banks start to manage money and rip off clients the way they did in 2008, people will close their bank accounts and shareholders along with the general public will sue the banks.

Because it is a widely known fact that banks and financial entities did these things, and there are multiple legal precedents for suing companies engaged in this kind of activity, deleting Dodd Frank and/or opting to not enforce regulations or attempting to remove all bank regulations is not likely.

Meanwhile, no-one is asking the following questions:

1) Where is Trump going to get $30-40 billion to build the Mexican Wall? Also, what sane company or people with a conscience would want the contract to build a wall that does not make sense?

2) Where is Trump going to get the billions that will be needed to maintain the wall once it it built?

3) Where is Trump going to get the $$$ needed to hire thousands of people to "patrol" the wall FOREVER?

4) How is Trump going to explain his reasoning for wasting $100 billion + on a boondoggle (the wall) that doesn't make sense? (I thought republicans were supposed to be against wasteful government spending?)

5) Why is Trump alienating the USA from all of its allies?

6) Why is the US government spending $100-200 million + every month to support Trump's family , Trump's businesses, and Trump's insanely priced vacations?

The amount of money being spent on Trump's "lifestyle choices" would be more than enough to do a massive overhaul of US infrastructure, give free housing to all homeless people, and probably have enough left over to make Tuition free for all US citizens attending public colleges.

Note: The $100-200 million monthly figure doesn't include the negative impact Trump's lifestyle and policy choices are having on GDP ( such as diverting traffic in NY continuously, discouraging tourism, dismantling important government agencies and forcing states to devote time and resources to act as a check against Trump's executive orders, and many other things)

Note: Anyone who dislikes/disagrees this post without explaining their reasoning is basically outing themselves as a troll. If you have something to contribute to the conversation, I'd love to hear it. The issues I included in this post are not partisan, and are very valid!

I am asking serious questions. If you disagree with my observations, I strongly encourage you to explain why. If you want to act as a troll and don't want to give a serious answer or any answer, I encourage you to move along.

 

[Krugerrand]

Regarding your last part: You have been in TSLA long enough to know there is a big gap between what Elon intends vs. the reality. A grain of salt is recommended.

I've been in TSLA long enough to know that what Elon intends becomes reality at some point. I'll take that grain of salt and rim my $1T market cap margarita glass with it.

 

[techmaven]

LG Chem expansion in Holland, MI doesn't look to be capacity expansion after all, but rather a pack production facility.
(local paper website. sorry it's kind of a poor website and details were mostly about job growth rather than battery/plant specs. )
LG Chem to add new production facility, adding 100-150 jobs in Holland area

Well... apparently they've been running at 3/5ths capacity until sometime in 2015 when they started to add the 4th line, and now talking about adding the 5th line. I believe they were at ~0.8 GWh at 3/5's, so combined with improved density, likely around 1.6-1.8 GWh fully built out.

See this article: LG Chem looks to hire 50, bringing total to 400

 

[CaliBear1]

Okay. Sure the market might rally a bit more, but I find it extremely unlikely the broad market is going much higher.

At this point, stocks are rallying because of Trump's "promise" that he has a plan to fix everything, by reviving dying industries (such as coal), eliminate all oversight of banks and lending institutions, removing all government supported public works projects, doing away with everything Obama had anything to do with, and permitting companies to dump whatever they want wherever they want to reduce costs that some companies might consider "overly burdensome".

This is the narrative being pushed by the media and analysts. I seriously doubt this is how things will work out. Lawsuits by citizens and shareholders , and mass protests will prevent or delay many of the things people think Trump will do.

Note: I'm fairly sure If banks start to manage money and rip off clients the way they did in 2008, people will close their bank accounts and shareholders along with the general public will sue the banks.

Because it is a widely known fact that banks and financial entities did these things, and there are multiple legal precedents for suing companies engaged in this kind of activity, deleting Dodd Frank and/or opting to not enforce regulations or attempting to remove all bank regulations is not likely.

Meanwhile, no-one is asking the following questions:

1) Where is Trump going to get $30-40 billion to build the Mexican Wall? Also, what sane company or people with a conscience would want the contract to build a wall that does not make sense?

2) Where is Trump going to get the billions that will be needed to maintain the wall once it it built?

3) Where is Trump going to get the $$$ needed to hire thousands of people to "patrol" the wall FOREVER?

4) How is Trump going to explain his reasoning for wasting $100 billion + on a boondoggle (the wall) that doesn't make sense? (I thought republicans were supposed to be against wasteful government spending?)

5) Why is Trump alienating the USA from all of its allies?

6) Why is the US government spending $100-200 million + every month to support Trump's family , Trump's businesses, and Trump's insanely priced vacations?

The amount of money being spent on Trump's "lifestyle choices" would be more than enough to do a massive overhaul of US infrastructure, give free housing to all homeless people, and probably have enough left over to make Tuition free for all US citizens attending public colleges.

Note: The $100-200 million monthly figure doesn't include the negative impact Trump's lifestyle and policy choices are having on GDP ( such as diverting traffic in NY continuously, discouraging tourism, dismantling important government agencies and forcing states to devote time and resources to act as a check against Trump's executive orders, and many other things)

Note: Anyone who dislikes/disagrees this post without explaining their reasoning is basically outing themselves as a troll. If you have something to contribute to the conversation, I'd love to hear it. The issues I included in this post are not partisan, and are very valid!

I am asking serious questions. If you disagree with my observations, I strongly encourage you to explain why. If you want to act as a troll and don't want to give a serious answer or any answer, I encourage you to move along.

I guess you don't consider Israel an ally.

 

[Sudre]

I still don't understand why a 'series'-hybrid like the Volt can't run indefinitely on the electric motors powered by the ICE generator.

I wanted mention why I think GM does what they do with the Volt.

Yes a small generator can run the car at 60mph but it can not get it up to that speed. It takes at least 60kWh to accelerate a car up to 60 in a relatively decent time and if the driver wanted to pass someone they would need 60-100kWh. Generators with that kind of peek output are the size of a Chevy Volt. OK not really but they are much larger than a 20kWh generator. What happens when the battery is depleted and the car needs to go up a mountain?

The battery is needed to give that surge in power. When the battery is depleted the gas engine connects directly to the drive-train to provide it.

 

[ZsoZso]

Ha, I am so with you on this one! Have to watch my language (involuntary wtf is typical) every time I see one of those, especially at night :

View attachment 214873

Look at the bright side: if it gets into a crash you wouldn't notice the difference => saves on repair costs !

 

[jhm]

Abstractly these claims could be true if various numbers check out, which is not guaranteed. You claim a 70% hit for distribution which i find dubious, but even still compares well to the 100% higher cost for residential install over utility just for the panels, and then the .10$+/kwh depreciation on a battery. Of course, my original point wasn't really about this specific idea, but maybe it's lost in the humorous team building exercises.

Yes, I was off on that 30% figure. Nationally, generation is about 6c/kWh. The average rate for residential service is 12.5c/kWh, or about 10.3c/kWh for all ratepayers (inclusive of industrial and commercial which pay lower rates than residential). Souce: EIA - Annual Energy Outlook 2017

If we look more closely at generation costs, this is also inclusive of standby and peak generation. The common misconception that utility solar at about 4c/kWh is alot cheaper than rooftop solar at 12c/kWh, wholly misses the point that utility solar does not make a dent in the other generation costs. Even with tons of cheap utility solar, full generation cost will still be around 6c/kWh. Moreover the other 6.5c/kWh of transmission and distribution costs are not avoided. Thus, the cost of using utility solar at ones home is still about 12.5c/kWh.

So to the consumer utility solar is not inherently cheaper than rooftop solar. But if you happen to live in an area where your utility rate is 16 c/kWh or higher, then rooftop at 12 c/kWh may look quite attractive. Distributed solar is most popular in states where utility rates are well above the national average.

It sounds like this is not your particular issue. But I have spelled it out here because several others are advancing the idea that utility solar is universally cheaper than distributed solar, which I view as a misleading way to frame the issue. Solar at all scales is useful and can be cost effective.

 

[DragonWatch]

Okay. Sure the market might rally a bit more, but I find it extremely unlikely the broad market is going much higher.

At this point, stocks are rallying because of Trump's "promise" that he has a plan to fix everything, by reviving dying industries (such as coal), eliminate all oversight of banks and lending institutions, removing all government supported public works projects, doing away with everything Obama had anything to do with, and permitting companies to dump whatever they want wherever they want to reduce costs that some companies might consider "overly burdensome".

This is the narrative being pushed by the media and analysts. I seriously doubt this is how things will work out. Lawsuits by citizens and shareholders , and mass protests will prevent or delay many of the things people think Trump will do.

Note: I'm fairly sure If banks start to manage money and rip off clients the way they did in 2008, people will close their bank accounts and shareholders along with the general public will sue the banks.

Because it is a widely known fact that banks and financial entities did these things, and there are multiple legal precedents for suing companies engaged in this kind of activity, deleting Dodd Frank and/or opting to not enforce regulations or attempting to remove all bank regulations is not likely.

Meanwhile, no-one is asking the following questions:

1) Where is Trump going to get $30-40 billion to build the Mexican Wall? Also, what sane company or people with a conscience would want the contract to build a wall that does not make sense?

2) Where is Trump going to get the billions that will be needed to maintain the wall once it it built?

3) Where is Trump going to get the $$$ needed to hire thousands of people to "patrol" the wall FOREVER?

4) How is Trump going to explain his reasoning for wasting $100 billion + on a boondoggle (the wall) that doesn't make sense? (I thought republicans were supposed to be against wasteful government spending?)

5) Why is Trump alienating the USA from all of its allies?

6) Why is the US government spending $100-200 million + every month to support Trump's family , Trump's businesses, and Trump's insanely priced vacations?

The amount of money being spent on Trump's "lifestyle choices" would be more than enough to do a massive overhaul of US infrastructure, give free housing to all homeless people, and probably have enough left over to make Tuition free for all US citizens attending public colleges.

Note: The $100-200 million monthly figure doesn't include the negative impact Trump's lifestyle and policy choices are having on GDP ( such as diverting traffic in NY continuously, discouraging tourism, dismantling important government agencies and forcing states to devote time and resources to act as a check against Trump's executive orders, and many other things)

Note: Anyone who dislikes/disagrees this post without explaining their reasoning is basically outing themselves as a troll. If you have something to contribute to the conversation, I'd love to hear it. The issues I included in this post are not partisan, and are very valid!

I am asking serious questions. If you disagree with my observations, I strongly encourage you to explain why. If you want to act as a troll and don't want to give a serious answer or any answer, I encourage you to move along.

I hope the bottom line does not hurt as bad as 2008.

 

[Bgarret]

Another Tesla partnership with Upscale Retail, this time with Myer in Australia. (Thanks, Fred L.).

Electrek

I think these have some of the same potential as Elon's savvy use of twitter and Tesla's guerilla "marketing" without advertising. If they can put low(er) to no cost pop-up stores inside existing high-end Retail, it can be a cost-effective way to both increase sales and awareness/exposure to Tesla and electric cars. Rather than needing multiple storefronts in a major metropolitan area, they can get by with fewer large "hub" stores and more pop-ups that funnel traffic and test drives to the mother ship.

Maybe Elon can counsel The Donald and Ivanka on how to work with high end Retailers. #byenotbuyIvanka....#sad.

 

[racer26]

I wanted mention why I think GM does what they do with the Volt.

Yes a small generator can run the car at 60mph but it can not get it up to that speed. It takes at least 60kWh to accelerate a car up to 60 in a relatively decent time and if the driver wanted to pass someone they would need 60-100kWh. Generators with that kind of peek output are the size of a Chevy Volt. OK not really but they are much larger than a 20kWh generator. What happens when the battery is depleted and the car needs to go up a mountain?

The battery is needed to give that surge in power. When the battery is depleted the gas engine connects directly to the drive-train to provide it.

Nitpick: kWh is a unit of electricity usage or battery storage equal to 1 kW over a time period of one hour. kW is a unit of power. A Model S uses ~300Wh/mi, and a 60kWh Model S can go about 200mi on a charge. It takes about 3 hours to go that far, so a Model S uses about 20kW to push itself down the road steady state at highway speeds.

Thats the thing though - a kW is a unit of power. You can measure the performance of a gas engine in kW, and you would be able to use it to run a genset of efficiency x to generate (engine kW * x) kW of electrical power, where x is somewhere in the neighborhood of 80+%.

Economy auto engines these days are in the ~80kW territory - the 1.4L engine in the Volt is 63kW, and that's a pretty pathetically low power output from an engine that size. With a genset that's even 50% efficient, it should still be able to charge the batteries faster than you deplete them driving down the highway steady state. Toyota's 1NR-FE engine (found in Corolla and Yaris) is a 1.3L displacement and makes 74kW.

If it were me designing it, I would design it such that the genset could charge the battery in addition to providing the ~14kW it takes to go 60mph down the highway. That way, driving on the gas engine would always yield an increasing state of charge, unless you're stop and go-ing in the city, and even then, the genset is still running when you're stopped, so its probably fine.

 

[AcesDealt]

Yes, I was off on that 30% figure. Nationally, generation is about 6c/kWh. The average rate for residential service is 12.5c/kWh, or about 10.3c/kWh for all ratepayers (inclusive of industrial and commercial which pay lower rates than residential). Souce: EIA - Annual Energy Outlook 2017

If we look more closely at generation costs, this is also inclusive of standby and peak generation. The common misconception that utility solar at about 4c/kWh is alot cheaper than rooftop solar at 12c/kWh, wholly misses the point that utility solar does not make a dent in the other generation costs. Even with tons of cheap utility solar, full generation cost will still be around 6c/kWh. Moreover the other 6.5c/kWh of transmission and distribution costs are not avoided. Thus, the cost of using utility solar at ones home is still about 12.5c/kWh.

So to the consumer utility solar is not inherently cheaper than rooftop solar. But if you happen to live in an area where your utility rate is 16 c/kWh or higher, then rooftop at 12 c/kWh may look quite attractive. Distributed solar is most popular in states where utility rates are well above the national average.

It sounds like this is not your particular issue. But I have spelled it out here because several others are advancing the idea that utility solar is universally cheaper than distributed solar, which I view as a misleading way to frame the issue. Solar at all scales is useful and can be cost effective.

I certainly welcome detailed discussions on this specific and Tesla-relevant topic.

I don't think it's an accurate model to write off the 6.5c grid cost. Most solar customers still use the grid because there is an increasing cost to move from solar as a supplement to a complete replacement. And of course those on net metering can use the grid in that direction as well. It seems like all plausible futures continue to have a substantial grid infrastructure, even if the topology shifts around a little bit to accommodate long distance distribution and residential generation. So we have with coal, gas, and nuclear the case that you can drop a plant anywhere and they all perform about the same and so you put it near a population center and pump in the electrons. However, there is a big difference between where you locate solar and wind, so running longer-distance lines like HVDC likely makes sense as part of the manner in which our infrastructure evolves. And these lines are like 90+% efficient on long long distances. I think it's actually the stepping up/down voltage hardware that's half the bill on DC (why DC lost in the beginning).

 

[Waiting4M3]

Yes, I was off on that 30% figure. Nationally, generation is about 6c/kWh. The average rate for residential service is 12.5c/kWh, or about 10.3c/kWh for all ratepayers (inclusive of industrial and commercial which pay lower rates than residential). Souce: EIA - Annual Energy Outlook 2017

If we look more closely at generation costs, this is also inclusive of standby and peak generation. The common misconception that utility solar at about 4c/kWh is alot cheaper than rooftop solar at 12c/kWh, wholly misses the point that utility solar does not make a dent in the other generation costs. Even with tons of cheap utility solar, full generation cost will still be around 6c/kWh. Moreover the other 6.5c/kWh of transmission and distribution costs are not avoided. Thus, the cost of using utility solar at ones home is still about 12.5c/kWh.

So to the consumer utility solar is not inherently cheaper than rooftop solar. But if you happen to live in an area where your utility rate is 16 c/kWh or higher, then rooftop at 12 c/kWh may look quite attractive. Distributed solar is most popular in states where utility rates are well above the national average.

It sounds like this is not your particular issue. But I have spelled it out here because several others are advancing the idea that utility solar is universally cheaper than distributed solar, which I view as a misleading way to frame the issue. Solar at all scales is useful and can be cost effective.

Here in Nor Cal PG&E charges $19c/kwh, so residential solar makes a lot of sense

 

[Lesifass]

1) Where is Trump going to get $30-40 billion to build the Mexican Wall? Also, what sane company or people with a conscience would want the contract to build a wall that does not make sense?

Some German company (HeidelbergCement) already looks forward to help with building "the wall".
We have a lot of experience with building and maintaining border walls. I suspect we have lots of highly-skilled workers for that type of business in the eastern parts of Germany.

Also, in case Trump ever wants to build camps, I'm sure there are some good Germans who learned a bit about how to build and run camps while talking to their grandparents.

</sarcasm>

Business knows no morals and has no conscience. If there's money to earn, someone will do it and not care at all about if it makes sense.

 

[jhm]

I certainly welcome detailed discussions on this specific and Tesla-relevant topic.

I don't think it's an accurate model to write off the 6.5c grid cost. Most solar customers still use the grid because there is an increasing cost to move from solar as a supplement to a complete replacement. And of course those on net metering can use the grid in that direction as well. It seems like all plausible futures continue to have a substantial grid infrastructure, even if the topology shifts around a little bit to accommodate long distance distribution and residential generation. So we have with coal, gas, and nuclear the case that you can drop a plant anywhere and they all perform about the same and so you put it near a population center and pump in the electrons. However, there is a big difference between where you locate solar and wind, so running longer-distance lines like HVDC likely makes sense as part of the manner in which our infrastructure evolves. And these lines are like 90+% efficient on long long distances. I think it's actually the stepping up/down voltage hardware that's half the bill on DC (why DC lost in the beginning).

Yes, there is a substantial argument for a HVDC backbone. I suspect this is more relevant for wind and hydro than for solar. If we seek to max out wind resources, then there is a substantial gap to span to get that to population centers. Some of these lines may be quite useful now. The counterpoint, however, is that it may not be necessary to max out midcountry wind. In the time that this build out would take, solar and battery storage could fall fast enough to provide a lower cost alternatives. I do not claim to know which technology will win this race, and frankly it depends on how long we want to keep using fossil fuels. I suspect that the advantage goes to solar+batteries over wind+HVDC the longer we dither. (And I would prefer us not to dither.) What sort of timeframe are we looking at for a national HVDC backbone?

 

[AcesDealt]

Yes, there is a substantial argument for a HVDC backbone. I suspect this is more relevant for wind and hydro than for solar. If we seek to max out wind resources, then there is a substantial gap to span to get that to population centers. Some of these lines may be quite useful now. The counterpoint, however, is that it may not be necessary to max out midcountry wind. In the time that this build out would take, solar and battery storage could fall fast enough to provide a lower cost alternatives. I do not claim to know which technology will win this race, and frankly it depends on how long we want to keep using fossil fuels. I suspect that the advantage goes to solar+batteries over wind+HVDC the longer we dither. (And I would prefer us not to dither.) What sort of timeframe are we looking at for a national HVDC backbone?

Fwiw Huge Transmission Line Will Send Oklahoma Wind Power to Tennessee

This has some interesting data points including your time to build. Interestingly it references an old hvdc line built from wash to l.a. for hydropower.. just reverse it! Actually i think pnw still has lots of hydro but they are slowly shutting them down. Have to protect the fish.

 

[ggr]

I wanted mention why I think GM does what they do with the Volt.

Yes a small generator can run the car at 60mph but it can not get it up to that speed. It takes at least 60kWh to accelerate a car up to 60 in a relatively decent time and if the driver wanted to pass someone they would need 60-100kWh. Generators with that kind of peek output are the size of a Chevy Volt. OK not really but they are much larger than a 20kWh generator. What happens when the battery is depleted and the car needs to go up a mountain?

The battery is needed to give that surge in power. When the battery is depleted the gas engine connects directly to the drive-train to provide it.

Units, please.

 

[vgrinshpun]

As an interesting tidbit, Tesla's director US-East was on tap at the annual meeting of Commercial Real Estate Development Association - New Jersey Chapter to promote solar roof+storage:

"Jeremy Snyder, director, United States-East for Tesla discussed innovations related to energy supply and energy demand. In his remarks on Tesla’s solar technology and renewable energy storage innovations, Snyder cited examples of how each offers opportunities for commercial real estate developers.

With its 2016 acquisition of solar-energy company SolarCity, Tesla is producing solar tiles that will be available commercially later this year.

“The cost of a solar tile roof is similar to a traditional roof, and you’re offsetting your energy costs by installing a functional roof,” he noted. The company’s Powerpack and Powerwall 2, battery systems that integrate with solar to provide energy for home and commercial use, offer unlimited scalability for any size project."

 

[vgrinshpun]

On the topic of the cost of renewable energy, due to deregulated electricity market in PA consumers are able to shop for electricity providers via various on-line sites. I am using this process for getting electricity for a couple of years, and 100% renewable options were historically offered at significant premium over regular electricity contracts. Well, not anymore. Couple of days ago I signed up for a second lowest fixed price contract (6 month) from Frontier Utilities which includes 100% renewable energy. ($0.0645/kWh). This is first time I've seen 100% renewable contracts being cost compatible with the conventional energy supply contracts.

 

[neroden]

I'm in a similar boat: Sold a decent house in the country about an hour's drive from work for $285k. Moved closer to work and invested the equity while renting a townhouse. In my area, the price/rent ratio is out of control in favour of renting.

Humorously, when I looked into the situation in my area in 2008, the ratio was badly out of control in favor of owning. (Of course, as a college town, there's a lot of transient population, over half the population, so there's a lot of people who will rent and will definitely not want to buy.) I went to rent and realized it was much more cost-effective to buy.

The local status of the price/rent ratio really is a number one should keep an eye on. (Where I live it's better to buy if you're going to be there for *three years*. Seriously.)
Rent vs. Buy Calculator - Is it Better to Rent or Buy? | SmartAsset.com

 

[neroden]

But how much will the real estate market change by that time? Up or down?

Who knows? Real estate is very local most of the time (2008 was a major exception).

California real estate prices are artificially elevated by extremely restrictive zoning laws and Prop 13. If either of these is changed (the zoning laws are more likely to be changed) the market will crash.

If you really like the location and the house, maybe it's worth it.... if you're sure you'll be able to make the payments. Which sounds like it is not a sure thing, but I don't know how high your income is or how reliable it is.