Sunday, October 25, 2020

Sunday Morning Links

  • Two electric-vehicle startups have completed listings in recent months, while a further four electric-vehicle and battery companies have announced plans to do so. These all have little or no revenue. [WSJ]
  • [U]pdates on several of Mr. Musk’s past proclamations about new products were either absent or vague. Tesla didn’t provide a production timeline for its semi truck or second-generation Roadster sports car, products it unveiled in 2017. Mr. Musk said the pickup truck, which Tesla showed off last fall, might be available by the end of next year “if all goes well.” There was also no update on Mr. Musk’s April 2019 declaration that Tesla could have one million fully self-driving “robotaxis” on the road by the end of this year. Fantasies about the future can be far more pleasing than the brutal, competitive nature of the day-to-day auto business. For Tesla shareholders, confusing dreams with reality is still likely to prove expensive, eventually. [Charley Grant]
  • Worth noting that when these parts are replaced under warranty they were often classified as "goodwill" and not warranty... so... while the SCs have all those records, they're also easily dismissed internally It's not really debatable that the suspensions require more frequent servicing than other cars-- at least for the earlier S-- there's PLENTY of reports online and I can't think of a single local owner I know that didn't have major components replaced in the first 50k (under warranty) and many who are on second/third+ replacements of control arms and links. [elektrek]
  • I drive a late 2016 MX 90d. Yesterday, 9/16, as I reversed out of a street parking spot, I heard a loud crunch noise, kind of like I ran over road debris. Since I had my 5 year old in the car, I stopped to see what happened. I could see the felt lining of the wheel well had rolled into the tire. I pushed the felt liner back into place and drove off. Within 100 yards, the front wheel jumped up like it was out of place. Pulled over and quickly realized something was really wrong. Used the app to get roadside assistance and as he pulled the car into the bed, noticed the control arm was broken off. Towed it to the SC and left it there. Got the call this morning from the SC and they confirmed it was the control arm. Without hesitation they said it was covered under warranty and they would replace the right side control arm as well. In addition, they replaced my left tire that was damaged by the control arm. Picked up the car same day, all fixed and under warranty.      Feel lucky to have had this easy of a process compared to some of the stories here... appreciate all the comments and background everyone provided, helped me feel knowledgeable in dealing with the SC. Will report to NHTSA as well. First post here, just wanted to share my story. [TMC]
  • Instead, what struck us was that the filing appeared to be a scan of a PDF. Why does that matter? Because it makes it pretty hard for a machine to read the filing. Even stranger was that when we went to look at their language on forward-looking statements and non-GAAP income, it was impossible to copy and paste the text to compare the language, or black-line it. A quick scan of Tesla’s filings shows that the company started doing this a year ago. The second quarter of 2019 was the last time that their earnings were regular text, as opposed to a scan of a PDF. [Footnoted]
  • Goldman admitted today that, in order to effectuate the scheme, Leissner, Ng, Employee 1, and others conspired with Low Taek Jho, aka Jho Low, to promise and pay over $1.6 billion in bribes to Malaysian, 1MDB, IPIC, and Aabar officials.  The co-conspirators allegedly paid these bribes using more than $2.7 billion in funds that Low, Leissner, and other members of the conspiracy diverted and misappropriated from the bond offerings underwritten by Goldman.  Leissner, Ng and Low also retained a portion of the misappropriated funds for themselves and other co-conspirators.  Goldman admitted that, through Leissner, Ng, Employee 1 and others, the bank used Low’s connections to advance and further the bribery scheme, ultimately ensuring that 1MDB awarded Goldman a role on three bond transactions between 2012 and 2013, known internally at Goldman as “Project Magnolia,” “Project Maximus,” and “Project Catalyze.” [DOJ]
  • Who knew that Henry Ford (who said "I Invented the Modern Age!") had so much in common with Steve Jobs? A blacksmith named David Bell who worked for Henry Ford starting with the Quadricycle said "I never saw Mr. Ford make anything". Ford's employees and family (he didn't have any "colleagues") would say that he had a gift for getting other people to work for him - like Steve and Woz. Ford had early exposure to engines, such as the Westinghouse portable steam engine, which he used as a tool on the family farm. When he was 28, he started at the Edison Illuminating Company in Detroit. Since he was responsible for fixing the steam engines used for electrical generation when they broke down, he had free time to tinker with his own gasoline engines and auto-mobiles. Ford had the instinct that every man would have a gasoline engine paired with a horseless carriage, just as Jobs had the instinct that every man would have a computer. Ford's accomplishment was not inventing the auto-mobile, which was simultaneously invented, but creating an organization that could mass produce it at an affordable price. As with Jobs, it is not clear how much of the company's success was from Ford and how much was from brilliant employees. Ford could never stand to share the spotlight, with the result that he couldn't (or didn't want to) keep his most capable lieutenants with the company. This includes James J Couzens, who became Mayor of Detroit, and William Knudsen, who became president of General Motors. [CBS]
  • The social acceptability of smoking is much higher outside of NA. On this topic, last year I sat across from someone who was smoking iQOS for an entire evening (in a restaurant in Europe). The second hand smoke does not smell. And so he did not feel bad about smoking it all night, and throughout dinner. He pointed out that while he preferred combustible cigarettes, the no-smell advantage of the iQOS, as well as the supposed health benefits, had sold him on it. Many smokers I know in the US haven't even heard of this product. I think there is an underappreciated growth runway for both PM and MO. [CoBF]
  • From the regrettable Anadarko merger on, Occidental’s CEO has proven to be a poor decision-maker. The decision to give away Colombia’s crown jewels to private equity at a knockdown price is another such error. Still, given Occidental’s massive debtload, there admittedly are not a lot of good choices here. Leadership promised at least $2 billion in asset sales in 2020 to help make a dent in the company’s liabilities. Since Occidental’s higher-cost Permian assets aren’t meaningfully profitable or cash flow positive at the moment, the assets that can be easily sold are the best ones, such as the Colombian production. Unfortunately, Occidental will be left with increasingly high-cost, marginal production as it sells off Colombia, Wyoming, and other basins in the current liquidation spree. [link]
  • The tremendous sacrifices that have been made are a sunk cost now. What are relevant are the potential costs and benefits (if any) of continued involvement in Afghanistan, starting from now, which is what should be evaluated and discussed. Poor reasoning about sunk costs is a sure way to torpedo a strategic deliberation. Trump also did not elucidate any interests in Afghanistan that would qualify as "core interests." As Steve Sailer says, "Afghanistan is the sort of quagmire that ideally, you'd lure your greatest enemies to attempt to occupy. 'Oh no, stay out of Afghanistan! It’s the strategic center of Asia, controlling all of the mountain passes. It’s a veritable Gibralter or Constantinople of strategic world locations.'" A clear understanding of the core interests would have been important for understanding what benefits could be derived from the Afghanistan activities, which could then be compared to the costs. [CBS]
  • Technology lures us out on to thin ice. I learned this years ago, when I got my first 4-wheel drive vehicle. Thinking that now I could go anywhere, I soon discovered that you get stuck using four wheels, too, but much worse than you can get stuck with two-wheel drive (a Land Rover stuck up to its axles in deep mud is sad to contemplate!). [Eric R. Pianka]
  • October case rates are higher in colder, less populated, Republican-leaning counties. Unlike earlier in the pandemic, household size, residential crowding, and local racial/ethnic composition now have no relationship with county case rates. And, strikingly, places with higher case rates in springtime or summer have higher case rates now, rather than having developed relative local immunity or resistance. [Jed Kolko]
  • The next question to decide is which industrialized nations are ready for the meathook. You would observe that certain countries have been continuously living beyond their means. They have been endlessly borrowing money far in excess of their economic growth potential and their ability to ever repay the debts they are now taking on is precisely nil. Chief among them is the United States, which has been living on borrowed time for decades now and whose mammoth debt dwarfs all previous excesses combined. Coupled with the gradual loss of reserve currency status by the US dollar and the concomitant loss by the US of the exorbitant privilege of printing money as needed, this has placed the US at the epicenter of the inevitable financial collapse. You would interpret the REPO panic of August 2019, when interest on overnight loans that used US federal debt as collateral spiked to 10%, as a crack in the carefully maintained Potemkin village fa├žade of the US financial system. [Orlov]
  • Shifting racial dynamics in the U.S. have heightened the salience of White racial identity, and a sense that Whites’ social status and resources are no longer secure. At the same time, the growing size of non-White populations has also renewed attention to skin color-based stratification and the potential blurring of racial boundaries. We theorize that Whites with darker skin will be motivated to protect the boundaries of Whiteness due to the loss of status they would face from blurring racial boundaries. Consistent with growing evidence of skin color’s importance for Whites, we demonstrate that darker-skinned Whites—measured via a light-reflectance spectrophotometer—identify more strongly with their White racial identity and are more likely to hold conservative political views on racialized issues than lighter-skinned Whites. Together, these findings offer new insights into the evolving meaning of race and color in American politics. [link]
  • It is painfully obvious that we’re going to see the media proclaim Biden the winner no matter how the vote breaks. All you people following the electoral horse race don’t understand that we’ve *already left* the regime of peaceful and legitimate democratic transition of power. These scandals don’t matter. The votes don’t matter. The court decisions on ballot counting don’t matter. Hunter Biden’s degeneracy doesn’t matter Nobody, left or right, is going to concede the election on the basis of these antique artifacts of a calmer era. The game is now about pure power and counting heads. Even as we read this blog, leaders and operatives on both sides are quietly counting heads and exchanging whispered assurances with men with guns. After the election, whatever will happen will happen *fast*, and it’ll be a long time before we know the ground truth of the events of the next few months. There will be confusion, lies, and most likely violence. Nobody’s going to give a damn about the vote tallies. When the dust settles, the voting records will be adjusted to support whoever wins the real contest. [Jim]

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