Tesla and Uber Unlikely to Survive...
Discussion
Heres Johnny said:
Free unlimited supercharging back on new inventory cars. While it seems yet another desperate move, in the UK it’s about 17 MS cars. I can see about 4K new inventory cars worldwide and it’s not much better than the referral option of 5k miles but it is yet another change
All this price changing just seems very odd and really gives an impression of a chap who just doesn’t know what to do. The decline in product demand very clearly demonstrates that they have exhausted the global supply of consumers who respond to that kind of DFS lowest level form of enticement and that what they manifestly have to do is recruit consumers from the conventional majority. DonkeyApple said:
Judt answer the question. What tax bill?
The exercising of share options can be a taxable event. Whether, in this particular case, that means an actual net payment to the IRS by Musk isn’t possible to determine with 100% accuracy from publicly available information.But, if I had to guess, I would lean very much towards no bill, rather than bill
JPJPJP said:
The exercising of share options can be a taxable event. Whether, in this particular case, that means an actual net payment to the IRS by Musk isn’t possible to determine with 100% accuracy from publicly available information.
But, if I had to guess, I would lean very much towards no bill, rather than bill
The clue is in the document. The beneficial holder is not Elon Musk. But, if I had to guess, I would lean very much towards no bill, rather than bill
Tax is for suckers.
Doesn't matter if the holding is direct / indirect
There is not enough information available in the public domain to know 100% certainly whether this taxable event will result in a net payment to the IRS by Musk.
You and I both know it is very unlikely, but it could
Anyway, enough IRS pedantry. Much more interesting is whether the exercise of the options is a show of confidence in the company's future, or something to do with the stock margin loan situation.
There is not enough information available in the public domain to know 100% certainly whether this taxable event will result in a net payment to the IRS by Musk.
You and I both know it is very unlikely, but it could
Anyway, enough IRS pedantry. Much more interesting is whether the exercise of the options is a show of confidence in the company's future, or something to do with the stock margin loan situation.
JPJPJP said:
or something to do with the stock margin loan situation.
nope.1. Musk has $507M in personal loans secured by stock
2. Musk owns 33.9M shares out of 178M shares outstanding
3. TSLA's share price of $211.03 means Musk's holdings are worth $7.1B
4. Assume a worst case margin requirement of 100%
5. Musk would need to secure $507M with ~$1B in stock
6. Musk has pledged 13.3M shares or $2.8B at the current stock price
7.That means Musk loans are secured by roughly 18% of his shares pledged
8. 18% is well below the 25% loan-to-pledge requirement set by the TSLA board
9. TSLA would would have to be around $151.53 for Musk to be in violation of the board's rule
10. If #8 became a danger, Musk could simply pledge more shares, as only 39% of Musk's shares are pledged right now, and the stock price would have to drop to $151.53 before he'd have to pledge more
11. Tesla's 25% loan-to-pledge rule is specifically to prevent margin calls
JPJPJP said:
I wonder why he is scratching about with 175k options then?
Because why not, its a good time for him to get them? Its really meaningless numbers overall, he bought $25mil more the other week.In a true end-of-the-world situation, Elon would be in violation of Tesla's 25% rule at $59.82. At $59.82 Elon's 19% ownership of TSLA would be worth $2.029B; 25% of which is his $507.4M loan.
Even then, TSLA would have to drop to $29.91 for Elon to be forced to sell at a 100% margin requirement.
At that point Elon could buy all of tesla with his stake in Spacex
Edited by RobDickinson on Wednesday 22 May 09:55
DonkeyApple said:
All this price changing just seems very odd and really gives an impression of a chap who just doesn’t know what to do. The decline in product demand very clearly demonstrates that they have exhausted the global supply of consumers who respond to that kind of DFS lowest level form of enticement and that what they manifestly have to do is recruit consumers from the conventional majority.
This has to be the big concern - that it turns out that Tesla sales were a combination of the (very low number of) existing EV enthusiasts and a larger set of Apple style early adopters sold on the brand. If moving into 'mainstream' production is not converting 'mainstream' customers, they really are going to have to pull a rabbit out of the hat to get through to next year. It wouldn't even benefit any of the existing players to buy Tesla if they're stalled on market penetration.RobDickinson said:
nope.
1. Musk has $507M in personal loans secured by stock
2. Musk owns 33.9M shares out of 178M shares outstanding
3. TSLA's share price of $211.03 means Musk's holdings are worth $7.1B
4. Assume a worst case margin requirement of 100%
5. Musk would need to secure $507M with ~$1B in stock
6. Musk has pledged 13.3M shares or $2.8B at the current stock price
7.That means Musk loans are secured by roughly 18% of his shares pledged
8. 18% is well below the 25% loan-to-pledge requirement set by the TSLA board
9. TSLA would would have to be around $151.53 for Musk to be in violation of the board's rule
10. If #8 became a danger, Musk could simply pledge more shares, as only 39% of Musk's shares are pledged right now, and the stock price would have to drop to $151.53 before he'd have to pledge more
11. Tesla's 25% loan-to-pledge rule is specifically to prevent margin calls
Lend is estimated to be closer to $1b than 0.5b. And the 25% rule categorically does not prevent a margin call. It’s not mechanically possible to prevent a margin call. The 25% rule exists to reduce the risk of what is called a death spiral where one entity’s margin call risks the investments of the other shareholders. It was imposed by the shareholders to try and protect them from the debt requirements of another. 1. Musk has $507M in personal loans secured by stock
2. Musk owns 33.9M shares out of 178M shares outstanding
3. TSLA's share price of $211.03 means Musk's holdings are worth $7.1B
4. Assume a worst case margin requirement of 100%
5. Musk would need to secure $507M with ~$1B in stock
6. Musk has pledged 13.3M shares or $2.8B at the current stock price
7.That means Musk loans are secured by roughly 18% of his shares pledged
8. 18% is well below the 25% loan-to-pledge requirement set by the TSLA board
9. TSLA would would have to be around $151.53 for Musk to be in violation of the board's rule
10. If #8 became a danger, Musk could simply pledge more shares, as only 39% of Musk's shares are pledged right now, and the stock price would have to drop to $151.53 before he'd have to pledge more
11. Tesla's 25% loan-to-pledge rule is specifically to prevent margin calls
Absolutely right that Musk can pledge more stock to cover a margin call but once that starts happening as the underwriter you have to increase the margin requirement in order to represent the new risk profile. And that is the mechanical risk involved as it speeds up the arrival of the point that equity can no longer be posted as margin and then its on to straight cash (which Musk doesn’t have, or collaterising other assets which in this case only SpaceX is beloved to be relatively unencumbered.
The positive is that much of the trust’s debt lies with MS and GS and they will have an incentive to utilise client funds to prop up the share price because of their client default risk.
If they can maintain the price above the 200 technical level then the worst is over for the short term. If they can then publish reasonable numbers for Q2 (the market is pricing in bad data) then there should actually be a strong reversal as fear subsides.
Musk has been banging on about recession for months, and with all the recent defensive measures in the company, I find it hard to beleive Musk's personal finances are not ogransised to cope with a dip under 200. (I obviously don't understand the details, but that's just my general impression)
More likely it's a bullish gesture, seeing as he can't easily tweet anymore?
More likely it's a bullish gesture, seeing as he can't easily tweet anymore?
DonkeyApple said:
Lend is estimated to be closer to $1b than 0.5b
I thought you are supposed to know what the f
k you are talking about? honestly you spew bullst at every damned chance and never back a fking word of it up. If you had a f
king clue you would know this stuff is public and reported, no need to estimate.https://ir.tesla.com/node/19821/html
Here is the relevant section if you are too f
king dumb to scroll."As of April 30, 2019, the outstanding balance under these loans is approximately $208.9 million. In addition, Goldman Sachs Bank USA, an affiliate of Goldman Sachs & Co. LLC, has made various extensions of credit to Mr. Musk and the Trust. Interest on these loans accrues at market rates, and Goldman Sachs Bank USA received customary fees and expense reimbursements in connection with these loans. As of April 30, 2019, the outstanding balance under these loans is approximately $213.0 million. Finally, Bank of America, N.A., an affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated, has made extensions of credit to the Trust and guaranteed by Mr. Musk, which are secured by shares of Tesla. Interest on the loans accrues at market rates, and Bank of America, N.A. received customary fees in connection with these loans. As of April 30, 2019, the outstanding loan balance was approximately $85.5 million. "
Here is the share pledge also.
https://ir.tesla.com/node/19726/html
Now this is the absolute last time i respond to your outstanding complete and utter irrelevant drivel.
Well none of us have a clue really. Maybe combined we can scratch something together.
Are you worried at all about future model 3 funcationality being impacted by Tesla being over leveraged for growth?
Even if chance of BK is only 5% is that a consideration for buyers?
yes someone else could buy them, but would it be the same investment in the software?
Are you worried at all about future model 3 funcationality being impacted by Tesla being over leveraged for growth?
Even if chance of BK is only 5% is that a consideration for buyers?
yes someone else could buy them, but would it be the same investment in the software?
sambucket said:
yes someone else could buy them, but would it be the same investment in the software?
Hoping it won't come to that. I can't see why anyone would buy them. If they can't make a go of car manufacture, why would any other player want to take on another underperforming marque? From a competitive point of view, best to let them go bust, lose the liability of all those customers demanding support and buy up the interesting tech in a fire sale. Tesla is so hugely over-valued that if you bought them as a 'going concern', you'd never pay back the investment.
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