geneclean55
Active Member
On the topic of this merger gets around the dealership restrictions: Why does anyone think that? If selling something other than cars was all it took, Tesla could just claim to be a clothing and accessories boutique that also sold cars. Not sure how adding solar suddenly fixes things.
On the appearance of a bailout: I think Johan has it right. It probably is a bailout and if they didn't intervene the company would lose actual value in the marketplace. This way, for a relatively small valuation they can pick it up and get the TE distribution network they need. It isn't much of a stretch to imagine a failing SCTY would stink up the other businesses in Musk inc. If SCTY can have material problems and financial concerns, why not the others? Best to avoid that, even if it means paying a premium.
On Elon's tiredness and opaque answers: I really think Elon is pushing too hard into "just trust me" territory. He is starting to believe his own legend, that he can do no wrong. (the list of mistakes made at the shareholders meeting was a self indulgent victory lap, not a mea culpa). When he says its a "no-brainer" all I hear is "don't worry your pretty little head about it, I have it all worked out". This was the issue I had with pivoting away from financial results in favor of M3 acceleration. That was the first foray into "just trust me". This is a second, much larger addition of faith he is asking for. He will probably get it but the more shareholders he alienates, the lower the share price goes and the lower faith he will engender. Eventually even Elon will need to care about this.
On Elon not caring about the share price: Earlier in the year, the more jubilent versions of "DTU" theory(that I promulgated with others) had that Elon had our back and was gaming for a share price rise to fuel goodies later in the year. He has taken the bewildering approach of grabbing the goodies at the expense of share price instead. Its fine and appropriate for a CEO to not attempt to manage share price, but he will find all his plans will unravel in a material way if the share price unravels.
On TFTF running Bull lines at us: Hilarious. My hat is off. I had pushed for a "bear cave" thread earlier in the year and we got it! Thundering herds of "Merger-Bears" trample the once peaceful Short Term Thread meadows. Also, hats off to the regulars who are showing that we were never in Kool-aid drinking lockstep.
On Elonism: Investing in TSLA is a combination of due diligence using available data and filling the gaps with faith in a top notch CEO. No amount of research will get you all the way certain, we just don't have the data. But I always felt that TSLA was like 80% certainty 20% faith. I was comfortable with that. Falcon wing doors well, 76/24. Announce plans to accelerate the M3 and THEN do a cap raise... ok... 65/35. Buy SCTY, an opaque strange solar service provider. 30/70? Everyone has a fact/faith ratio they can live with and by driving the ratio down the stock price sinks as less religious investors bail.
On whether the deal passes: If it failed, Elon would be pissed and sulk and blame absolutely everything that went wrong thereafter on it. So we take the bad deal or get a pissy distracted Elon.
On "Q2 deliveries must be a beat because only with that knowlege would Elon do this": I don't buy it. See above about Elon not caring about stock price. He is really just trying to grab his pieces on the chessboard and damn the cost. Since he is truly convinced that the stock valuation of his company(ies) will be much higher later he doesn't think it matters the impact of his actions now. Also, it is possible that he thought the merger would cause a rise in both tickers.
On price action: We are crazy lucky to only be down 11%. I predict this will take 3-5 days to play out. After the suspension failure crap came out I cautioned it would not settle in a day and indeed it was 4 days of down. This will probably be 3-of-5 down days as well. I would normally think of a few down weeks, but sidelined longs and shorts will start to fear being out next week and missing potential Q2 announcement. If, as some have argued, the Q2 deliveries are a beat, this could be exactly what the doctor ordered. A delivery beat, an upbeat GF party (I don't expect anything but a pep rally for that), could do wonders to change the narrative. Q2 good financials might get us back to the 240's or something. A Q2 miss on the other hand.... That would cause an unprecedented run for the exits. TM has gone far too long now without doing-what-you-say, and way too much promising-the-world. Elon cannot ask us to trust him and miss achievable near term goals. Patience is running low and Fear of biting too much too high.
This is the first change to TM in many years that really causes one to stop and think about if the company is going in the right direction. Others pointed it out, but this is not in the master plan. And while you can say it is to save the Earth, just partnering would have done the same thing.
I am lucky I was mostly out of calls and into vanilla shares. I bailed on those in the AH last night for ~196, not a great price. This could be a mini February "V" dip and recovery in which case it is a good way to leverage up and make money on good Q2 results in July-Aug. Or, Brexit, merger concerns and lackluster Q2 could send this thing into the toilet in a serious way. Sitting and stewing for a few days.
I agree with a lot of this. But if q2 deliveries are poor/average, won't that influence the yet to be held merger vote?
