***Official*** 2017 Stock Market Thread

[desura]

The investment thread got me thinking. Tesla now has a market cap bigger than Ford. Freaking FORD, which sells like a bazillion cars annually. Tesla stock is, beyond a shadow of a doubt, massively overpriced. But it keeps going up, getting even more overpriced. When should I short this sucker? Want to catch it at its peak, not get run over if it keeps going up after I short it haha.

Thanks.

I wouldn't.

The thing I have realized lately is that the stock market is really unmoored from fundamentals. A lot of it really is emotion-driven. Tesla stock is high because the guys who make the decisions are driving Tesla cars and they love their Tesla cars.

And Tesla got a big round of investment from a Chinese firm. Foreign money will likely continue flowing into Tesla. Foreign money tends to really be ignorant. There are more billionaires in China than the US. A bunch of those probably drive Tesla cars. and so there will always be money for Tesla.

 

[zinfamous]

I wouldn't.

The thing I have realized lately is that the stock market is really unmoored from fundamentals. A lot of it really is emotion-driven. Tesla stock is high because the guys who make the decisions are driving Tesla cars and they love their Tesla cars.

And Tesla got a big round of investment from a Chinese firm. Foreign money will likely continue flowing into Tesla. Foreign money tends to really be ignorant. There are more billionaires in China than the US. A bunch of those probably drive Tesla cars. and so there will always be money for Tesla.

I see Tesla as way more than just cars--Yes, if they do succeed here, it does put them in line for being one of the primary operators in the inevitable electric, self-driving paradigm--but I think much of their value lies in their battery/energy tech and everything else that they are developing or improving, related to the cars: deep-learning software, gadgets and whatsits that are probably unique to the vehicles but could be applied to all sorts of general machinery (hello, licensing!) and, of course the battery/energy producing tech that now includes solar.

I like Tesla for making viable, whole-home energy-storage and generating solutions. They are more diversified than many give them credit...but I'm sure people far smarter than myself see that as well, and are already betting on these things. It's just that I only ever see Tesla skeptics talking about the big gamble with the auto industry, and not so much about everything else that Tesla is.

 

[desura]

I see Tesla as way more than just cars--Yes, if they do succeed here, it does put them in line for being one of the primary operators in the inevitable electric, self-driving paradigm--but I think much of their value lies in their battery/energy tech and everything else that they are developing or improving, related to the cars: deep-learning software, gadgets and whatsits that are probably unique to the vehicles but could be applied to all sorts of general machinery (hello, licensing!) and, of course the battery/energy producing tech that now includes solar.

I like Tesla for making viable, whole-home energy-storage and generating solutions. They are more diversified than many give them credit...but I'm sure people far smarter than myself see that as well, and are already betting on these things. It's just that I only ever see Tesla skeptics talking about the big gamble with the auto industry, and not so much about everything else that Tesla is.

I think Solar City is a fascinating concept and I like what they are doing, but boy it did look like such a bad operating decision for Tesla to acquire them, and that move stunk of nepotism and bailing out Solar City.

And yet Tesla is enjoying higher highs because Tencent invested a billion into it. Tencent's investment is a game changer.

But also, previously, the big players in the auto industry have been skeptical on Tesla. Toyota sold their stake a few years back. Ford famously bought a Model S and completely disassembled it. These guys know the fundamentals and are shy of Tesla for good reason. But investing isn't driven by core competency or poring over numbers so much anymore. It seems like it has been like this for quite a while now, actually.

 

[desura]

Thing about Ford and GM is that they still use UAW labor. Tesla's automation moves might play a big role in optimism. With automation, they might just be able to scale up higher and better than anyone knew. Like, with human labor there looks like there is more of a cap in terms of what can be done, but the extent at which Tesla is automating the production line means higher efficiencies will always be forthcoming.

Kinda related, but I had the idea of shorting Nintendo stock due to the fundamental crappiness of the Switch console...but the power of nostalgia is strong and the Switch it appears is selling quite well despite its very embarrassing problems.

 

[zinfamous]

Thing about Ford and GM is that they still use UAW labor. Tesla's automation moves might play a big role in optimism. With automation, they might just be able to scale up higher and better than anyone knew. Like, with human labor there looks like there is more of a cap in terms of what can be done, but the extent at which Tesla is automating the production line means higher efficiencies will always be forthcoming.

Kinda related, but I had the idea of shorting Nintendo stock due to the fundamental crappiness of the Switch console...but the power of nostalgia is strong and the Switch it appears is selling quite well despite its very embarrassing problems.

Tesla also isn't beholden to the antiquated, useless, model of distribution through dealership franchising. This also makes them more fluid. Of course, the auto lobbyists don't like this and see it as an "unfair advantage," rather than an efficient innovation. On the flip side, automation and direct distribution points to fewer and fewer jobs...so is that really a good thing? I can sympathize with both sides, here, but in the end the only person that makes this decision will be the consumer.

 

[desura]

Tesla also isn't beholden to the antiquated, useless, model of distribution through dealership franchising. This also makes them more fluid. Of course, the auto lobbyists don't like this and see it as an "unfair advantage," rather than an efficient innovation. On the flip side, automation and direct distribution points to fewer and fewer jobs...so is that really a good thing? I can sympathize with both sides, here, but in the end the only person that makes this decision will be the consumer.

It is a good thing. There was a story recently in Bloomberg about auto workers in the South getting mangled by machinery. absolutely mangled.

The dealer model...I'm not convinced is so bad that Tesla's direct approach is obviously superior. But the laws hindering Tesla definitely should go away.

 

[dullard]

On the flip side, automation and direct distribution points to fewer and fewer jobs...so is that really a good thing?

Long-term, yes it is a good thing. Short-term to medium-term it is a terrible thing.

Long-term, we finally have the chance at the utopia of never needing to work. You can work for enjoyment, work for prestige, work for social interaction, etc. But you don't have to work, as machines will provide the food, goods, and services that you need.

But how do we transition from mostly employed to mostly unemployed? There will be a viscous divide of the haves and the have-nots (with virtually no way of going from one category to the other). This transition is not going to be easy, nor will it be peaceful.

 

[JEDI]

Long-term, yes it is a good thing. Short-term to medium-term it is a terrible thing.

Long-term, we finally have the chance at the utopia of never needing to work. You can work for enjoyment, work for prestige, work for social interaction, etc. But you don't have to work, as machines will provide the food, goods, and services that you need.

But how do we transition from mostly employed to mostly unemployed? There will be a viscous divide of the haves and the have-nots (with virtually no way of going from one category to the other). This transition is not going to be easy, nor will it be peaceful.

'Man in the high castle' -> End govt support of "useless eaters"

 

[zinfamous]

Long-term, yes it is a good thing. Short-term to medium-term it is a terrible thing.

Long-term, we finally have the chance at the utopia of never needing to work. You can work for enjoyment, work for prestige, work for social interaction, etc. But you don't have to work, as machines will provide the food, goods, and services that you need.

But how do we transition from mostly employed to mostly unemployed? There will be a viscous divide of the haves and the have-nots (with virtually no way of going from one category to the other). This transition is not going to be easy, nor will it be peaceful.

Well, Zenn-La figured it out, somehow. Too bad Galactus ate them, so we can't really ask them how they did it.

 

[jpiniero]

I think Solar City is a fascinating concept and I like what they are doing, but boy it did look like such a bad operating decision for Tesla to acquire them, and that move stunk of nepotism and bailing out Solar City.

Just think of the electric cars as a way to fund the battery R&D needed to make off-the-grid Solar really popular. I don't think the Big 3 really need to worry about Tesla; but utilities might.

 

[desura]

Just think of the electric cars as a way to fund the battery R&D needed to make off-the-grid Solar really popular. I don't think the Big 3 really need to worry about Tesla; but utilities might.

No. I think electric cars are for replacing gas cars. Bloomberg has a story where they projected that the electric car might lead to a permanent decline in world oil prices by way of demand destruction.

 

[desura]

Considering shorting Children's Place. I walked by one and it looks ripe for a fall. Thoughts?

 

[Imp]

Been a while but this just had to be shared...

If you want to see hilarity, go check out HCG (Home Capital Group), a "non-prime" or something mortgage lender in Canada. Down a lot since the OSC (Ontario Securities Commission) announced they were under investigation earlier this year. Last week, the OSC released a preliminary report about the findings and the stock tanked.

It's down 63% right now from yesterday. News of a run on deposits and them having to get new financing at a high borrowing rate.

The company revealed that high-interest savings account balances fell by $591-million since March, leaving a total remaining balance of $1.4-billion.

http://www.theglobeandmail.com/repo...l-secures-2-billion-lifeline/article34816524/

The funny is the human behavior and dichotomy: I've been following HCG for a few weeks and reading a short seller's twitter feed detailing how bad it really was. On the other side, I've also been reading regular-Joe investors on another forum talk about how this stock was so cheap based on various metrics -- they wrote big long posts justifying it and these ones got up-voted the most...

P.S. People are calling this Canada's Countrywide.

 

[ImpulsE69]

Thing about Ford and GM is that they still use UAW labor. Tesla's automation moves might play a big role in optimism. With automation, they might just be able to scale up higher and better than anyone knew. Like, with human labor there looks like there is more of a cap in terms of what can be done, but the extent at which Tesla is automating the production line means higher efficiencies will always be forthcoming.

Kinda related, but I had the idea of shorting Nintendo stock due to the fundamental crappiness of the Switch console...but the power of nostalgia is strong and the Switch it appears is selling quite well despite its very embarrassing problems.

Age old question. It doesn't take 1000 workers to run 1000 robots. Probably takes a handful. At what point do you figure out you screwed yourself because no one can afford your product because there are no jobs. Capitalism goes both ways, and corporations are really really forgetting that because of their short term view.

 

[FelixDeCat]

Will this Trump rally ever end?

 

[ImpulsE69]

Will this Trump rally ever end?

Eventually..and it will be epic. I predict many many suicides.

 

[KB]

Will this Trump rally ever end?

Its getting close. I see calls for DOW 30,000 which typically portends disaster.

http://www.marketwatch.com/story/trumps-tax-plan-sets-the-stage-for-dow-30000-2017-04-26

 

[Charmonium]

S&P profits have been rising recently so the rally probably has a good way to go.

 

[jpiniero]

Those bastards at the Treasury Department kept the I-Bond fixed rate at 0.

 

[FelixDeCat]

Those bastards at the Treasury Department kept the I-Bond fixed rate at 0.

lol

We poors only pay interest, we aren't allowed to collect it!

When the prime rate goes to 12%, they might start paying passbook interest rates on I-Bonds again (5%),.

 

[dullard]

The stock market certainly didn't like AMD losing money again in the last quarter (although they almost profited which is quite a rarity for AMD). Down over 20% this morning.

 

[zinfamous]

The stock market certainly didn't like AMD losing money again in the last quarter (although they almost profited which is quite a rarity for AMD). Down over 20% this morning.

Yup, getting HAMMERED! weird, though, considering they met expectations (WS wanted them to be magical, though?) and Q1 didn't really include signficant exposure for Ryzen (only 3 or so weeks for R7 sales, and R5 was only released in Q2).

It seems that AMDs estimate of 32% gross margins in Q2, updated from 33% is what really scared people away? sounds odd if that's the case.

But Naples and Vega are still on track for Q2. I might buy in again if this hits $10...and certainly lower.

 

[jpiniero]

Yup, getting HAMMERED! weird, though, considering they met expectations (WS wanted them to be magical, though?) .

Apparently Wall Street thought Ryzen's release would be enough to get a beat when their APU sales must be in the toilet and their GPU revenue probably isn't great either considering how cheap Polaris is selling for now. In other news, Wall Street is dumb. We'll have to see how well Naples does.

 

[zinfamous]

Apparently Wall Street thought Ryzen's release would be enough to get a beat when their APU sales must be in the toilet and their GPU revenue probably isn't great either considering how cheap Polaris is selling for now. In other news, Wall Street is dumb. We'll have to see how well Naples does.

yeah, but there are only ~3.5 potential weeks of sales for Ryzen (and only 30% of the product stack) in all of Q1. It was never a mystery that Q2 would be more indicative of actual adoption. I guess they missed that nugget, too?

 

[Charmonium]

There's a saying in the markets about this. 'Buy the rumor, sell the news.' This is what always happens and nobody ever understands why. You get a company that beats expectations in quarterly report and the stock tanks.

Personally, I think what happens is you get these feeding frenzies over particular stocks so they get bid up way, way beyond what can be justified by the numbers. The quarterly report is then the dose of reality that everyone needed and everyone comes back to their senses.