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  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    "In 1887, Tesla constructed a brushless alternating current induction motor based on a rotating magnetic field principle, which he demonstrated to the American Institute of Electrical Engineers (now IEEE) in 1888 and patented that same year.[62] Until the development of induction motors, AC's advantages for long distance high voltage transmission were counterbalanced by the inability to operate motors on AC. Tesla claimed that he conceived his induction motor in 1882 although the claim had no independent verification.[63] The paternity of the invention remains controversial, since rotating magnetic fields and a prototype induction motor were demonstrated in Europe in 1885 by Galileo Ferraris.[64][65][66][67] Ferraris published his findings in 1888.[68] Also in 1897 Tesla developed the principles of his Tesla coil."
    http://bit.ly/QztZdC

    A battery powered car (DC) would have been an abomination for the man who fought the "energy war" for AC energy delivery vs. Thomas Edison. A giant battery on wheels would not have been his conception of the automobile.

    I think a company named after Tesla would have actually produced something revolutionary rather than working on improving a technology that already existed a 100 years ago but that's just me.

    I truly admire the engineering prowess of the vehicle, the elegance of design, and the visionary leadership of Elon Musk in making this happen but in the end it is still just a Rube Goldberg device solving a problem that doesn't need solving.

    I don't blame the company for building this product since the market price signals have been so distorted by government intervention (tax credits, EPA policy, destroying the coal industry) and fraudulent global warming science.

    With the financials they have and the obvious limits in the state of battery technology is this company ever going to turn a profit before it runs out of money?

    At the current rate of burn, this company will need to raise a lot of money to keep going.

    Good luck with your investment!
    Sep 10, 2012. 10:48 AM | Likes Like |Link to Comment
  • mREITs: Volatility, Beta And Risk [View article]
    Joseph,

    That's a great article. Excellent research.

    It seems mREITS trade a lot like bonds and therefore the risk factors are slightly more bondlike - credit risk, interest rate risk, pre-payment risk, and economic risk.

    Have you any insights into how these would behave in a rising interest rate environment? Can it be modeled?

    NLY is one I am interested in for obvious reasons but I am still puzzled by what a 1% rise in short-term interest rates would do to their underlying business and as a result the equity. The dividend gives a cushion but it's a double-edged sword because the dividend is dependent upon a low interest rate environment.

    So in a rising rate scenario, I assume that margins would be squeezed which implies the dividend could be cut which in turn also impacts the price of the stock especially if the long end of the curve remains anchored at current levels. Certainly a very convoluted process.

    Seems like we need a different concept than beta for this asset class something more along the lines of duration.

    Do you have any insights into how we would model this?

    Thank you.
    Sep 10, 2012. 10:23 AM | Likes Like |Link to Comment
  • General Motors (GM) loses a staggering $49K on each Chevrolet Volt it builds, according to numbers dug out by Reuters. Though the loss per vehicle could shrink if the plug-in hybrid program is built to scale, the automaker faces an uphill battle with rivals seeing better success with their own electric and hybrid vehicles. (Related: Tesla firing on all cylinders?[View news story]
    Gives new meaning to the phrase "loss-leader".

    So the goal is to lose money on every car and make it up it in volume which sounds suspiciously like a typical Obama economic policy.

    So instead of selling SUV's which are profit cows for GM they promote this POS which is exactly what you expect from a company taking its orders from the Government.
    Sep 10, 2012. 09:05 AM | 5 Likes Like |Link to Comment
  • Mortimer Zuckerman digs into the jobless numbers and finds that "they're even worse than they look." The headline rate may have fallen, but there are 5.2M "long-term" unemployed, while 8M have no job but are not counted as they've not looked for work in the past four weeks. Add in involuntary part-time workers, and Zuckerman reckons that the real unemployment rate is closer to 19%, as it was almost a year ago[View news story]
    Drew,

    He voted for Obama (and Dems) before he was against him. At least he is intelligent and humble enough to admit he made a mistake.

    I'm guessing he employs more people than you do now and he sure helped employ a heckuva of a lot of people while building his businesses. The riches at the end are the end result of the hard work at the beginning and are never fore-ordained.

    Too bad the President doesn't understand this aspect of our economy and how it works.
    Sep 9, 2012. 11:24 PM | 1 Like Like |Link to Comment
  • Food stamp cuts are bad for business, warns incoming Kraft (KFT) CEO Tony Vernon, who says a minimum one-sixth of company revenue comes from program usage. Proposals floating around Congress would cut funding for food stamps as health advocates point out the program is a corporate subsidy to the nation's processed food giants. [View news story]
    "CEO Tony Vernon, who says a minimum one-sixth of company revenue comes from program usage. Proposals floating around Congress would cut funding for food stamps as health advocates point out the program is a corporate subsidy to the nation's processed food giants."

    Funny this blurb answers the question it poses in a nice concise way.
    Sep 9, 2012. 11:12 PM | 2 Likes Like |Link to Comment
  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    http://1.usa.gov/OjYczf

    Coal, natural gas, and nuclear are the electricity grid power sources. Coal is by far the number 1 source of fuel for electricity so therefore all EV vehicles are powered largely by coal or other fossil fuels by definition.

    No way around that, although I have to admit the President's War On Coal is working.

    Nat Gas is growing like crazy which is a good thing, but unlike Nancy Pelosi, I actually do know that Natgas is a fossil fuel :)

    By the way, Nikola Tesla would have found the whole idea of a DC powered car abhorrent.
    Sep 9, 2012. 03:40 PM | Likes Like |Link to Comment
  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    "Morpheus: I imagine that right now, you're feeling a bit like Alice. Hm? Tumbling down the rabbit hole?
    Neo: You could say that.
    Morpheus: I see it in your eyes. You have the look of a man who accepts what he sees because he is expecting to wake up. Ironically, that's not far from the truth. Do you believe in fate, Neo?
    Neo: No.
    Morpheus: Why not?
    Neo: Because I don't like the idea that I'm not in control of my life.
    Morpheus: I know exactly what you mean. Let me tell you why you're here. You're here because you know something. What you know you can't explain, but you feel it. You've felt it your entire life, that there's something wrong with the world. You don't know what it is, but it's there, like a splinter in your mind, driving you mad. It is this feeling that has brought you to me. Do you know what I'm talking about?
    Neo: The Matrix.
    Morpheus: Do you want to know what it is?
    Neo: Yes.
    Morpheus: The Matrix is everywhere. It is all around us. Even now, in this very room. You can see it when you look out your window, or when you turn on your television. You can feel it when you go to work, when you go to church, when you pay your taxes. It is the world that has been pulled over your eyes to blind you from the truth.
    Neo: What truth?
    Morpheus: That you are a slave, Neo. Like everyone else, you were born into bondage, born into a prison that you cannot smell or taste or touch. A prison for your mind. Unfortunately, no one can be told what the Matrix is. You have to see it for yourself. [Opens Pill box and empties the contents into his hands and outstretches his hands] This is your last chance. After this, there is no turning back. You take the blue pill [opens his right hand revealing a translucent blue pill], the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill [opens his left hand revealing a similarly translucent red pill], you stay in Wonderland, and I show you how deep the rabbit hole goes. [Neo reaches for the red pill] Remember: all I'm offering is the truth. Nothing more."
    Sep 9, 2012. 03:31 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: Will The Fed Disappoint Markets? [View article]
    Jeff,

    Thanks for the response. Your point would be stronger if the prior revisions had been positive but they were negative despite the prior ADP numbers. I get your point, however, it doesn't change the fact that the overall trend - declining workforce participation - is still going down and it is not due to demographics.

    Workforce participation in those over 55 has increased as have their share of the jobs so the older near retirement group appear to be pushing out the younger working age people.

    I am just looking at this with a straight forward, non-partisan viewpoint which is that there is no way to say the job market is strong at this point in the cycle when by all rights it should be.

    Clearly aggregate demand is stagnant. I am not sure why that is but I guess if you subscribe to the Balance Sheet Recession idea than this is the expected outcome - deflationary pressures - which explains the FED's obsession with liquidity.

    However, as we have all discovered, the markets are not the economy, and in terms of investing this suggests that there will clearly be no wage inflation pressure for a long time to come which means that corporate margins are not going to be under pressure from wage demands. This is obviously a powerful positive for corporate income statements but clearly a challenge for wage earners.
    Sep 9, 2012. 12:35 PM | 2 Likes Like |Link to Comment
  • Weighing The Week Ahead: Will The Fed Disappoint Markets? [View article]
    "The household survey also showed a decline in jobs, although this series has fluctuated wildly. The decline in the unemployment rate was not statistically significant (after rounding) and mostly reflected a reduction in the labor force."

    I literally (yes Joe Biden) can't get over this factoid and yet we are in the "expansion" phase of the economic cycle. When the number first came out, I assumed that that household survey showed job expansion to account for the decline in the rate so this is really a horrific report.

    How bad does it have to be for people to actually give up looking for working in these astonishing amounts?

    The workforce should be increasing at this point in the cycle yet somehow we get more people added to foodstamps than found work last month. It's totally a bizarro world.
    Sep 9, 2012. 11:59 AM | 2 Likes Like |Link to Comment
  • Mortimer Zuckerman digs into the jobless numbers and finds that "they're even worse than they look." The headline rate may have fallen, but there are 5.2M "long-term" unemployed, while 8M have no job but are not counted as they've not looked for work in the past four weeks. Add in involuntary part-time workers, and Zuckerman reckons that the real unemployment rate is closer to 19%, as it was almost a year ago[View news story]
    http://bit.ly/QwXsS7

    "Zuckerman, a long-time supporter of the Democratic party who cast his vote for Barack Obama in the 2008 presidential election, was critical of President Obama on several fronts. Following the downgrade of US treasury debt by Standard & Poor's in 2011, Zuckerman wrote in the Wall Street Journal: "I long for a triple-A president to run a triple-A country."[17] After initially supporting President Obama's call for heavy infrastructure spending to revive the economy, Zuckerman criticized the composition of the plan, stating "But if you look at the make-up of the stimulus program, roughly half of it went to state and local municipalities, which is in effect to the municipal unions which are at the core of the Democratic party."
    Sep 9, 2012. 11:48 AM | 5 Likes Like |Link to Comment
  • What might the troubles of "Sock City" - the Chinese boom town of Datang which last year produced about two pairs of socks for every person on earth - say about the rest of the economy? May's collapse of Anli Sock Group - which made 60M pairs annually - may prove to be "the Lehman Brothers of Datang," according to one government economist. "I'm very worried," says a surviving producer. "This year is much worse than 2008-09." [View news story]
    The Pets.com Sock Puppet mascot could not be reached for comment on this story.

    http://bit.ly/QsX0Kf
    Sep 9, 2012. 11:43 AM | 7 Likes Like |Link to Comment
  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    Rational,

    "Within a year, there will be superchargers on almost every major interstate that will fully recharge a Model S in about 40 minutes, just enough time to grab a bite to eat, stretch and proceed."

    So your argument against my rational observation on long family vacation driving is to cite a non-existent technology of the present and perhaps the future?

    Show me your link for this "supercharger" technology, its implementation plan, locations, cost, etc.

    45% of our electricity comes from burning coal and the rest from nuclear and other fossil fuels. A truly pitiful amount comes from "clean energy" *(gag) of which hydro-power is not included because whacko environmentalists think water power is bad for the environment.

    Auto reviewers, as in Product Placement pay for performance experts, like it. Wow. That's hilarious.
    Sep 8, 2012. 01:07 PM | Likes Like |Link to Comment
  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    Wow. I got quite the pile on happening here. Thanks for all the positive thoughts.

    I thought I would cut and paste a previous comment on this subject since it seems appropriate here.

    To everyone above, I will state it plainly, these cars are inferior, more expensive, less safe, less reliable, and without government corporate welfare - $500 million dollar crony capitalist loan - wouldn't exist. This company wouldn't exist without the teat of government.

    Why subsidize the lifestyles of the rich and famous at the expense of the poor in this country?

    This is what you get when you build an industrial policy on the back of the lie of man-made global warming. Wasted resources, wasted money, wasted effort, and a lower standard of living for everyone in the world - burning food (corn) for fuel is just the ultimate manifestation of this stupid delusion which coincidentally has been exposed as the scientific fraud that it is. Perhaps you haven't heard yet.

    What you all fail to realize is that the car is part of an overall lifecycle from beginning to end and when these things end they pollute the environment to a far greater extent than any so-called benefit they provide while under operation - all those toxic batteries and the rare earths that need to be mined to get these toasters on wheels going doesn't do much to "save the world".

    The problem with Liberal ideas is they fall apart under the harsh light of logical examination.

    Now if this were a natural gas powered car then I would be interested.

    In case it isn't obvious, I am a rabid, nut-job, whacko, right-wing Randian who also happens to be an opinionated, knowitall a-hole :)

    Have a nice day!
    Sep 8, 2012. 01:00 PM | Likes Like |Link to Comment
  • The rave reviews for Tesla Motors' (TSLA +2.9%) Model S aren't quite done pouring in after Motor Trend just returned from a Vegas-to-L.A. test drive that proved both the 265 mpg equivalent rating and zero-to-60 mph acceleration in under six seconds are valid. The company has the highly-anticipated Model X slated for 2014 if production wrinkles are worked out. As for cash burn, Elon Musk says as long as there aren't a "bunch of screw-ups," the automaker should be in good financial shape. [View news story]
    Thom

    "There are pros and cons to each technology. Stop spreading your rhetoric like you know what you're talking about. You don't know shit."

    Well I know the substance when I see it and your comment certainly looks like it :)

    Apparently calculating a cost benefit is beyond your engineering acumen.

    Truthfully I fail to see the value proposition in electric cars. Usually when a product replaces another it is superior in all ways:

    Price
    Features
    Performance
    Reliability
    Resale
    Longevity
    Safety
    Etc.

    It fails on all of these criteria. Secondly I can't stand crony capitalists like this company who suck off the government teat so yes I have a problem with this company.

    Hybrids are already a superior solution and they cost less.

    By the way, you started it :)

    Have a nice day!
    Sep 7, 2012. 05:44 PM | 1 Like Like |Link to Comment
  • Market recap: Stocks edged higher to finish a big week, as the weak jobs report lent support to Bernanke’s assessment that the labor market remains a "grave" concern. Treasury prices rose and precious metals jumped as investors played the QE trade. Materials and metals stocks ripped higher as China unleashed a big infrastructure spending program. NYSE gainers topped losers seven to five. [View news story]
    "investors played the QE trade"

    "Investors" is an interesting choice of word for those doing this. "Gamblers" might be the better word.
    Sep 7, 2012. 05:11 PM | 1 Like Like |Link to Comment
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