Tesla Stock Tanks

Facing a cash payment of over $900,000,000 that is due and payable today (March 1st), yesterday Elon Musk took to Twitter and announced that Tesla was reshuffling the deck chairs. Tesla announced that they were eliminating their brick and mortar showrooms and opting for an online only purchasing option. Buy now and take delivery in June, (he hopes).

Tesla also announced that it is shifting sales worldwide to online only to “achieve these prices while remaining financially sustainable.”
“Shifting all sales online, combined with other ongoing cost efficiencies, will enable us to lower all vehicle prices by about 6% on average, allowing us to achieve the $35,000 Model 3 price point earlier than we expected,” the company said in a statement.
“Over the next few months, we will be winding down many of our stores, with a small number of stores in high-traffic locations remaining as galleries, showcases and Tesla information centers,” the statement continued. “The important thing for customers in the United States to understand is that, with online sales, anyone in any state can quickly and easily buy a Tesla.”

Tesla unveils $35,000 standard Model 3, shifts worldwide sales to online-only

Somehow this attempted misdirection was supposed to make Wall Street forgot that a huge chunk of their cash reserves evaporated today.

Tesla Inc. (TSLA – Get Report) shares traded sharply lower Friday after founder and CEO Elon Musk said a move to offer a cut-down version of its flagship Model 3 sedan will likely result in a first quarter loss, only weeks after telling investors he would turn the clean energy carmaker into the black.

“Given that there was just a lot happening in Q1, and we’re taking a lot of one-time charges and there are a lot of challenges getting cars to China and Europe, we do not expect to be profitable in Q1,” Musk told journalists on a conference call late Thursday. “But we do think that profitability in Q2 is likely.” That view was reiterated in a Securities and Exchange Commission filing Friday.

Tesla Extends Declines as $35,000 Model 3 Unveiling Raises Q1 Profit Questions

After my last post on February 6th, I was given a lot of grief about being pessimistic on Tesla but three weeks later their shares went from an opening of $316.50 on 02/06/2019 to a close today 03/01/2019 of $294.79.

Tesla week of 02-25-19

Please note the share price yesterday on the graphic as opposed to today’s close.

Elon is also being accused of violating securities laws because of his behavior yesterday.

Tesla short-seller Gabe Hoffman says Elon Musk broke security laws again

Highlights of the video above include:

  • Tesla Model 3 sold 6.5K in January and < 6K in February
  • Car production is fixed price, how can they move their prices around and still make a profit?

Other Tesla news can be found below.

Tesla to shell out cash for big $920M bond payment

Tesla’s cash flow numbers after this bond payment are going to get very difficult: Gasparino

Elon is keeping it afloat but his empire is listing badly and the bleeding continues.

Cold War Tome on Socialism More Relevant Now

If you want a cold, honest assessment of socialism you will not do any better than David Chilton’s forgotten book, Productive Christians in an Age of Guilt Manipulators.  Written at the height of the Cold War (1981), it is more relevant now than it was when he wrote it.

I have owned my copy of the book since I met David back in 1989 but I never read it. Why? Back in 1989 is when the Berlin Wall came down and the Soviet Union collapsed. I considered reading it back then, but we thought socialism, like the Soviet Union, had been disgraced and relegated to the scrap heap of failed human experiments. Sadly, like a bad movie or a fatal case of cancer, socialism is back.

David Chilton 1951–1997

One reason that I like reading the book is because Chilton is far removed from the current controversies raging in our country. This makes him a disinterested party free from opinions on Bernie Sanders and A.O.C. He is looking at the facts of socialism from a philosophical and historical perspective.

David goes further by not just describing the disease but the cure. In his writings, all things are measured by Scripture including governments and their ideas. On its surface, the book is a rebuttal of a “Christian Socialist” named Ron Sider.

I’m not done with the book, but I just had to blog on it after reading the excerpt which I quote below.

Envy is the greatest disease of our age. It is often confused with jealousy and covetousness, which have to do with wanting the possessions and privileges of others. Envy is much more insidious – and deadly. Envy is the feeling that someone else’s having something is to blame for the fact that you do not have it. The principal motive is thus not so much to take, but to destroy. The envier acts against the object of his envy” not to benefit himself, but to cut the other person down to his own level-or below. The American Puritan divine Samuel Willard defined envy as “a man’s repining at his neighbour’s Prosperity, looking upon himself to be Hurt by it.” In his massive study of envy, Helmut Schoeck points up this central factor: “the envious man’s conviction that the envied man’s prosperity, his success and his income are somehow to ‘blame for the subject’s deprivation, for the lack that he feels. ‘ It can be summed up in Pierre-Joseph Proudhon‘s famous epigram: Property is Theft!
 
This explains why “Envy and Malice are inseparable”; as we can see from the example in Genesis quoted above, the envier’s goal is destruction. Henry Hazlitt writes: “The envious are more likely to·be·mollified by seeing others deprived of some advantage than by getting it for themselves. It is not what they lack that chiefly troubles them, but what others have. The envious are not satisfied with equality; they secretly yearn for superiority and revenge.”
 
And it is this envious, destructionist mentality, nursing itself on the notion that ”your wealth is the cause of my poverty, “that is the basic ethos of socialism.  For socialism does not…..and cannot – build up capital. It seeks only to expropriate or destroy the capital of others. It exalts a malignant, misanthropic disposition into an article of political economy, a machine for tyranny. Socialism is institutionalized envy.
Pages 139-140

David Chilton’s book can be found here

Productive Christians in an Age of Guilt Manipulators

The PDF file is a free download from the publisher. If, like me, you like the dead tree version try searching Amazon.

David Chilton Wikipedia page

Paid Family Leave: Conservatives Invited to Join the Darkside

Wednesday, I was browsing my email account when this gem from former Pennsylvania US Senator, Rick Santorum, showed up in my IN Box. Folks, when I read it, I had about the same reaction that I do when Chef Gordon Ramsey is pillaging a restaurant’s walk-in refrigerator on Kitchen Nightmares.

I wanted to hurl.

Santorum claims to be a conservative; however, a quick internet search reveals that “These days, former Pennsylvania Sen. Rick Santorum is a senior analyst on CNN…”

The email in question stated that Santorum has started a campaign to get Conservatives on board with supporting paid family leave. Rick apparently is proud to attach his name to this idea. “Little Marco Rubio” is also attached to this venture. Here is a screenshot of the email from Santorum.

Santorum’s email promoting Paid Family Leave

Santorum, like the Republican Party in California, has jettisoned the old notion of less government and exchanged it for more tyranny. Apparently the old adage “if you can’t beat ‘em…” still rings true. When “conservatives” are offering more government as the solution to the problems created by government, then you know that something is amiss.

Folks the entire concept of paid family leave is nuts. The only reason that women must work is due to the confiscatory taxation of our population. If you added everything up, half of what you earn goes out in taxes of one form or another. If you don’t believe me, just make a list. FYI there are about 30 different taxes on your telephone. I don’t even think the “Sith Lord” could list them all but he’d probably get closer than our average reader.

What real Conservatives believe or at least they used to, is that you should keep more of your money because you can spend it better than someone in Washington or Sacramento.

The idea that a Conservative Political Action Committee (C-PAC) would ever give Santorum, Rubio & Company a place at their event is proof that their values are eroded.

In case you went to public school or weren’t paying attention, we threw the British out of here in 1776 because of a three percent tax! Boston Tea Party ring a bell? The cry was “Taxation without representation.” So how has the “taxation with representation” worked out?

Oh, speaking of three percent tax rates, that was the maximum tax proposed on the very rich in 1917 when the temporary tax called the Federal Income Tax was adopted to pay for our involvement in World War I. Again, how has that taxation with representation worked out?

Many years ago, I did contribute to Santorum’s failed Senate re-election bid. In light of recent events, it’s a good thing he lost. If this is what it takes to stand out in Republican circles these days and gives you the “street cred” to claim the conservative mantle then Paul Ryan and Mitch McConnell aren’t the only guys stinking up the once Grand Old Party.

Oh, if you check Rick’s website, they are talking about letting you tap your Social Security Trust Account to pay for this. No, really.

The plan is relatively straightforward — new parents could borrow against their future Social Security benefits by taking up to twelve weeks of payments after the birth of a child.

Link: Rubio’s pro-family, conservative family leave policy promotes stability

Back in the last year of the Bush Administration, I looked up the government’s statistics on unfunded mandates of the Federal Government. Social Security was the lion’s share of underfunded mandates totaling about 55 trillion dollars and now “Little Rubio” wants the snowflakes to tap it? Great idea.

I like President Trump but apparently he supports this idea too.

If this does get implemented, how much will you bet me that the Democrats find a way to take all the credit? This has been one of their pet issues for many years.

Hey Rick, way to throw the next generation under the bus by claiming to save them. Oh wait, I sense another government program on the horizon to fix this mess…