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The stock still defies gravity to all time high. Not sure whether it's irrational exuberance or investors truly see something in Tesla. Edit: Got scared and g

by ww520 10y ago

The stock still defies gravity to all time high. Not sure whether it's irrational exuberance or investors truly see something in Tesla. Edit: Got scared and got out at ~280. It was a good run but time to move on.

hackuser 10y ago
One factor: At least a couple of major investment banks, along with many other commentators, see Musk's apparently good relationship with President Trump as a reason to invest in Tesla. Of course, nobody can say how much it affects their market capitalization, but just the banks saying it will be self-fulfilling to an (unknown) extent. Musk wouldn't be the first to use lobbying to help his business, and so far (a small sample) Trump has used his power much more than past presidents to help and punish businesses he favors/disfavors (e.g., threatening businesses that want to relocate factories, threatening airplane manufacturers, tweeting favorable and unfavorable things about businesses, etc.). Trump has a reputation for corruption, that's factual; that doesn't tell us how true it is or how it applies in this kind of situation or in this particular case. What I'm trying to say is, let's be careful with the facts. If you search for 'musk trump', you can find plenty of discussion of it. Here's one article from a good source: https://www.nytimes.com/2017/01/26/business/elon-musk-donald-trump-wall-street.html https://www.nytimes.com/2017/01/26/business/elon-musk-donald...
- ww520 10y ago
  Unless the government buys from Tesla, Trump's help won't matter much to investors. In the case of a bailout, investor equity is the first thing destroyed. Trump would certainly help Tesla to survive in such an event, but for investors, its' better to buy after that than before.
  - hackuser 10y ago
    Good points; I wonder what the investment banks saw. Certainly Tesla depends on government laws, regulations and policy, especially as a new entrant seeking widespread changes in several regulated industries. For example, they want electric charging stations spread nationwide, they'd probably like fossil fuels to become more expensive or at least become less subsidized, subsidies for electric cars, regulators to not delay or limit Tesla innovations, etc. etc. Also, government does R&D on battery tech, I'm pretty sure. Does anyone know how much Tesla directly or indirectly benefits? Finally, they may want to sell to government; fleets of large organizations often are good customers for alternative fuels, because (AFAIK) they can provide and support their own infrastructure. But that is speculative (as is investing!).
aerovistae 10y ago
Your decision is going to look very funny in 4 years.
- ww520 10y ago
  My decision won't last for 4 years. If the stock's price looks right, I would jump back in. Given Tesla stock's volatile nature, it has a better probability of dropping 100 points than keeping on going up.
  - aerovistae 10y ago
    I appreciate your flexibility; I wonder what you would do if it went up 200 points instead-- conclude that that is surely as high as it can go, and wait for it to come back down?
    - ww520 10y ago
      Nothing. I don't fret over decision made based on what is known at the time. And I don't get emotionally attached to a stock. Who care if TSLA went up another 1000 points. There's always another investment opportunity.
chmaynard 10y ago
> ... got out at ~280. It was a good run but time to move on. Same here. Tesla CEO Elon Musk is clearly the greatest salesman in tech right now, and eager investors are rushing to purchase TSLA in anticipation of greater riches to come. The money pouring into their corporate coffers will be extremely useful as they ramp up for Model 3 production. I'll probably jump back in when they start paying a dividend. I'm not holding my breath.

by ww520 10y ago

hackuser 10y ago

One factor: At least a couple of major investment banks, along with many other commentators, see Musk's apparently good relationship with President Trump as a reason to invest in Tesla. Of course, nobody can say how much it affects their market capitalization, but just the banks saying it will be self-fulfilling to an (unknown) extent. Musk wouldn't be the first to use lobbying to help his business, and so far (a small sample) Trump has used his power much more than past presidents to help and punish businesses he favors/disfavors (e.g., threatening businesses that want to relocate factories, threatening airplane manufacturers, tweeting favorable and unfavorable things about businesses, etc.). Trump has a reputation for corruption, that's factual; that doesn't tell us how true it is or how it applies in this kind of situation or in this particular case. What I'm trying to say is, let's be careful with the facts. If you search for 'musk trump', you can find plenty of discussion of it. Here's one article from a good source: https://www.nytimes.com/2017/01/26/business/elon-musk-donald-trump-wall-street.html https://www.nytimes.com/2017/01/26/business/elon-musk-donald...

ww520 10y ago
Unless the government buys from Tesla, Trump's help won't matter much to investors. In the case of a bailout, investor equity is the first thing destroyed. Trump would certainly help Tesla to survive in such an event, but for investors, its' better to buy after that than before.
- hackuser 10y ago
  Good points; I wonder what the investment banks saw. Certainly Tesla depends on government laws, regulations and policy, especially as a new entrant seeking widespread changes in several regulated industries. For example, they want electric charging stations spread nationwide, they'd probably like fossil fuels to become more expensive or at least become less subsidized, subsidies for electric cars, regulators to not delay or limit Tesla innovations, etc. etc. Also, government does R&D on battery tech, I'm pretty sure. Does anyone know how much Tesla directly or indirectly benefits? Finally, they may want to sell to government; fleets of large organizations often are good customers for alternative fuels, because (AFAIK) they can provide and support their own infrastructure. But that is speculative (as is investing!).

aerovistae 10y ago

Your decision is going to look very funny in 4 years.

ww520 10y ago
My decision won't last for 4 years. If the stock's price looks right, I would jump back in. Given Tesla stock's volatile nature, it has a better probability of dropping 100 points than keeping on going up.
- aerovistae 10y ago
  I appreciate your flexibility; I wonder what you would do if it went up 200 points instead-- conclude that that is surely as high as it can go, and wait for it to come back down?
  - ww520 10y ago
    Nothing. I don't fret over decision made based on what is known at the time. And I don't get emotionally attached to a stock. Who care if TSLA went up another 1000 points. There's always another investment opportunity.

chmaynard 10y ago

> ... got out at ~280. It was a good run but time to move on. Same here. Tesla CEO Elon Musk is clearly the greatest salesman in tech right now, and eager investors are rushing to purchase TSLA in anticipation of greater riches to come. The money pouring into their corporate coffers will be extremely useful as they ramp up for Model 3 production. I'll probably jump back in when they start paying a dividend. I'm not holding my breath.