One of Elon Musk's many legal tangles, Vernon Unsworth v. Elon Musk (2:18-cv-08048-SVW-JC) is in federal court in the California Central District. From yesterday's order denying Musk's motion for summary judgment:
For the reasons discussed above, the Court DENIES Defendant’s motion for summary judgment. Dkt. 58. The jury trial remains scheduled for December 3, 2019 at 9:00 a.m., with pretrial on November 25, 2019 at 3:00 p.m..
From Beyond the Hundredth Meridian: John Wesley Powell and the Second Opening of the West. Born in 1909, Stegner wrote it in 1954.
p.214:
A firmly fixed pattern of settlement, of which the rectangular surveys and the traditional quarter-section of land were only outward manifestations, though in some ways determining ones, began to meet on the Great Plains conditions that could not be stretched or lopped to fit Procrustes' bed. A mode of life that despite varying soils and a transition from woods to prairies had been essentially uniform from the east coast through Kentucky and Ohio and on to the Missouri or slightly beyond, met in the West increasingly varied topography, climate, altitudes, crops, opportunities, problems. The Middle West, geographically and socially and economically, was simple; the West was complex. Instead of the gentle roll of the great valley there were high plains, great mountain ranges, alkali valleys, dead lake bottoms, alluvial benchlands. Instead of trees or oak openings there were grasslands, badlands, timbered mountains, rain forests and rain-shadow deserts, climates that ran the scale from Vermont to the Sahara. And more important than all the variety which was hostile to a too-rigid traditional pattern was one overmastering unity, the unity of drouth. With local and minor exceptions, the lands beyond the 100th meridian received less than twenty inches of annual rainfall, and twenty inches was the minimum for unaided agriculture. That one simple fact was to be, and is still to be, more fecund of social and economic and institutional change in the West than all the acts of all the Presidents and Congresses from the Louisiana Purchase to the present.p225:
Where water was available an irrigated farm was the safest in the world, for it depended on no meteorological luck, and properly watered it had its fertilizer spread upon it naturally every year in the form of silt. One hundred and sixty acres in the arid region was utterly incapable of supporting a family without irrigation, but with irrigation it became more than one man could handle. Irrigation agriculture was intensive, it took time and care, and it produced extravagantly. Powell therefore recommended eighty acres as the homestead unit for irrigated farms. But for pasture farms he proposed units of 2560 acres, four full sections, sixteen times the normal homestead. This was calculated to shock the orthodox, and yet in making the suggestion he apologized to many of his Western friends who assured him that he had made the unit too small.p.315:
Montana had 35,000,000 irrigable acres, 35,000,000 acres of mountains useful chiefly for their minerals and timber, and 20,000,000 acres of range. Those figures alone had profound institutional - and hence political - implications. Farmers on the irrigable acres needed to control the adjacent mountains, not merely for their timber but for their water-storage facilities, and for their potential exposure to erosion and floods and destruction of the watershed. The relations between mountains and plains wwas so close that the two should not be politically separated. And on the strength of that relationship and of the abiding importance of water ("all the great values of this territory have ultimately to be measured to you in acre feet") he made a set of proposals.
What he suggested was so radical that it could not possibly have any effect on the delegates, so rational that it could not possibly come to pass short of heaven, so intelligently reasoned from fact that it must have sounded to Montana's tradition-and-myth-bound constitution-makers like the program of a crank.
He proposed simply to organize the new state of Montana into counties whose boundaries would be established by the divisions between hydrographic basins rather than by arbitrary political lines drawn on the map. Such basins, already being plotted out in Montana as in other parts of the West by his survey crews, were natural geographical and topographical unities; they might be given political and economic unity as well. Within any drainage basin, timber, grazing, and agriculture were all tied together by the controlling element of water. Suppose local self-government were established within each basin; suppose the federal government ceded to each basin-county all the public lands within its limits; suppose water rights within those limits should be established by locally elected water-masters and enforced by local courts. That way, they could lessen and perhaps eliminate litigation, friction, water-wars, multiplying costs. If it chose, Montana could organize itself and set a pattern for all the still-forming states of the West.
[...] In Montana the race was as cussed as elsewhere. It went ahead and organized the new state according to the tried and true patterns of more than a hundred years, with county lines marking none but the political drainage basins, and county seats competitively chosen in the atmosphere of deal, coup, and horse-trade. The water that was the state's lifeblood was not neglected, but its control was left open to franchise and purchase and grab, and its management confused by four dozen illogical political dividing lines.
Yesterday we pointed out that Tesla is now trading at a record enterprise value of $73 billion. One of our readers pointed out how strange that is given the business results:
Last year in Q3 they had their best quarter ever. I was surprised, so were many and the stock reacted incredibly well. This year, the stock has arguably reacted even better but here is what I see as the differences:
The share price of Tesla has absolutely exploded since hitting a low of $176.99 on June 3rd - it has almost doubled to $346. It has not quite reached the all time high from August 2018 of $387 that was after Elon's $420 per share going private announcement.
However, Tesla's debt has been growing and so has its share count. Total liabilities were $17 billion at year-end 2016 vs $25 billion at the end of Q3 2019. (Remember that Tesla's revenue over the past twelve months was $24 billion. No other auto manufacturer has an enterprise value of more than 0.6x revenue. This obviously raises the question of whether Tesla's business is worth as much as its liabilities. Remember Adam Jonas observed in May, "even at a zero dollar equity value the enterprise value to sales ratio of Tesla would be 50% or so higher than VW.")
And like any unprofitable "tech" company, Tesla's share count continually grows. The result is that the enterprise value of Tesla is now at a record high:
Also, while Tesla's revenue over the past twelve months was $24 billion, sales are now falling year-over-year. Revenue from 2019 year-to-date was $17.2 billion, which annualizes to $23 billion. That means that the EV is now 3.2x a no longer growing revenue. That is absolutely insane for an automotive manufacturing company - too high by an order of magnitude!
The banks handling the WeWork IPO said that company was worth as much as $100 billion despite being unprofitable. There seems to be something really wrong with the markets. Sums of money like tens of billions just do not mean that much anymore.
It is hard to think of a catalyst for things to be normal again besides rising interest rates. When the ten year Treasury yield went above 3% in late 2018, the bubble seemed to deflate. Now with falling interest rates things seem to be crazy again.
Some of our previous posts on Tesla:
Posts
All Comments
