The Perils of Shorting: A Real Life Example

Colm Fagan said:
Even Tesla's biggest fans must agree that it's perverse that a decision to offer investors five times as many shares at one-fifth their previous value (five times one-fifth = 1) adds $50 billion to the company's value. That is what I estimate has been the increase in the company's market value between close of business on Wednesday, when the split was announced, and today. Nothing else of note happened in the meantime that might
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TSLA was at higher market cap a month ago briefly - so historically splits in the US have been positive for share price (as mad as that may be) but don't think it is the only factor
 
Hi Duke

Where are you seeing that?

It seems to me to be up in pre-trading which is what you would expect in this topsy-turvy world.

4923
 
Duke of Marmalade said:
Yes, I was looking at Friday's figures restated. 25.35 down is 5.7% of 442.68
I have corrected my post.
Actually I am confused. Was it down 25.35 on the old price or the new price?
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Everyone is confused this morning.

I got an email from degio to warn my investment dropped 80%.

I logged in and was showing as having a massive profit today.
 
I see that Tesla is raising another $5 billion from shareholders to fund its ongoing development. That's less than seven months after it raised $2.3 billion to fund its ambitious growth plans. It reminds me of the story from my home village of a brainy young fellow with an indulgent father. The guy got a scholarship to study in America. After a while he wrote to the father saying he was doing very well and had been invited to do another course. It was a feather in his cap, but the course was expensive and he needed money. The dad duly obliged. A short time later, he wrote to the dad again and said he'd been invited on to another, even more prestigious, course. Another feather in his cap, but he needed more money. Once again, the dad obliged. The same happened a couple more times, each time the young fellow getting another feather in his cap but needing more money. Eventually, the son admitted that things were going badly and he wanted to come home, but hadn't the money. Would the dad send him the air fare? The dad wrote back, telling him to take the feathers from his cap, stick them up his rear end and fly home.
It's starting to feel a bit like that with Tesla. For how long will the indulgent shareholders keep shelling out money?
 
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well like alot of silicon valley executives he loves his jargon and produces mountains of it like "autonomy day" :)
Next we will hear Simon Harris or Leo Varadker using jargon like "autonomy day" to describe the end of coronavirus restrictions.
 
Well I for one am very surprised that another ground breaking day announced on Twitter turns out to be nothing more than hot air.. we promise that one day in the future, all the things we have promised for the past few years and more will come true...
 
Sunny said:
we promise that one day in the future, all the things we have promised for the past few years and more will come true...
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A good summary.

The problem is that he overpromises and that disappoints and takes away from his huge achievements.

Brendan
 
VW now have a serious electric car now as well so the competition is only going to increase. I don't believe musk will win against the big auto companies now that they are serious about producing electric cars. Up to this they would produce an electric car but it would only be a token gesture to the green movement and done more for pr reasons rather than serious production cars.
 
joe sod said:
VW now have a serious electric car now as well so the competition is only going to increase. I don't believe musk will win against the big auto companies now that they are serious about producing electric cars. Up to this they would produce an electric car but it would only be a token gesture to the green movement and done more for pr reasons rather than serious production cars.
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To be honest I don't think Elon Musk wants Tesla to win necessarily. He's an ideologue and his sole purpose with Tesla is to "accelerate the transition to sustainable transport" and the safety of self-driving cars, as he's said over and over.

If you look at all this through that lens (as opposed to trying to understandhim as a typical CEO/founder who is simply trying to build a successful business) a lot of this makes more sense. He bluffs about a Tesla pick-up truck to worry Ford/GM into going off and creating their own, which they have. He bluffs about a semi/articulated truck to worry Mercedes etc. into going and creating one themselves, which they're all now in the process of doing. Bit of bluff about self-driving and suddenly governments want to have their country at the forefront of self driving and even regular cars now come with some aspects of self driving. Same with the $25k car he promised yesterday, now if you're VW/BMW etc. you have to be worried you're going to see pressure in that segment and will have to continue to push EV development and not settle with where they've gotten to today.

I'm fairly confident if the other manufacturers stopped selling petrol/diesel pickups/semi/CUVs in favour of electrics, Elon would step away from Tesla and focus on his other ambitions and just let it run as a regular company fairly uninterested in its future short of wanting to use the value in it to support other projects.
 
I had always assumed that Tesla cars were way ahead of their competition and the only issue for me was the price of the shares. But my attention was drawn to this series of articles suggesting that they are not very good cars.


I appreciate that people's opinions differ and that all cars have problems, but does Tesla have more quality problems than other car manufacturers?

Brendan
 
Brendan Burgess said:
I had always assumed that Tesla cars were way ahead of their competition and the only issue for me was the price of the shares. But my attention was drawn to this series of articles suggesting that they are not very good cars.


I appreciate that people's opinions differ and that all cars have problems, but does Tesla have more quality problems than other car manufacturers?
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As the subtitle of that link says "they're fine with it". Teslas are better than other cars in a bunch of ways (range, speed of charging, charging network, self-driving tech, interface, acceleration, bang-for-your-buck (0-60 speed versus cost) etc) and people are willing to overlook the quality issues for now as they mostly get fixed after delivery if required.

They're way ahead of their competition in lots of ways, but not all ways.
 
Brendan Burgess said:
I appreciate that people's opinions differ and that all cars have problems, but does Tesla have more quality problems than other car manufacturers?
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Yes , that have terrible quality issues.

They basically don't have the traditional step of the local dealer fixing any issue before delivery. You need to QA your own car.

They would have no sales if they were not years ahead on the tech. But you can get the paint fixed on a model 3 , but can't get the tech added to a bmw.


I put a deposit down on a new model 3 yesterday , my first non-bmw in 15 years.
 
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