By Trade with Dave: President Obama and Elon Musk touring the SpaceX rocket facility in Cape Canaveral, Florida – April 2010Aswath Damodaran is a Professor of Finance at NYU’s Stern School. Aswath recently weighed in with his own valuation on Tesla that priced the stock at $67 rather than closer to the $170 you would have to pay for a single share. Dave had an interesting encounter just over a year ago with a vehicle designer from NASA’s Goddard Space Center. Dave and this particular gentlemen were actually discussing an automobile design when the gentlemen told Dave that he was a vehicle designer for NASA. Evidently this fellow actually designs the features and configuration of mostly what seemed to be the inside of manned rocket ships and the space shuttle.
What Dave recalls most clearly from that conversation was how the gentleman who works for NASA described the relationship with SpaceX. In so many words, and I paraphrase, the gentlemen said we could do everything that SpaceX does for the benefit of our country but we’re just too slow and we have too many layers of bureaucracy. Space X gets done in one year what would take NASA five years to do. He went on to explain in some detail how our government puts up the money and takes the risk and SpaceX shareholders will see the benefits.
This scenario reminds Dave of the heydays of Fannie Mae.
Remember when Fannie & Freddie were government agencies when it came to issuing guarantees on their debt and accessing capital markets, while at the same time they were a private enterprise when it came to doling out huge bonuses for their leadership? A quantum duality on Wall Street is a nice gig when you can get it.
Senator Diane Feinstein assumes the position on the hood of a new Tesla… vrooom. (photo: Steve Jurvetson)
Following Professor Damodaran’s initial salvo on the value of a single share of Tesla stock and it’s missing “Benjamin”, he quickly came under return fire from what he refers to as the “Tesla Bulls.” Here’s what Dave found most interesting about the follow-up blog post (emphasis Dave’s).
The “first mover”: If Tesla is more technology than automobile company, there is the possibility that if it can establish itself as the leader in the business, there may be a tipping point, where size feeds itself. In practical terms, you are arguing that if Tesla charging and service stations are more extensive than the competitors, buyers of electric cars will be more likely to buy Teslas, thus making it the “electric car” company.
Being “The electric car” company or being “The Fannie Mae” or “The Federal Reserve” seems to be the next iteration of what has been a duopolistic system for the past decade or two. Remember when you still had a choice between AT&T/Verizon, Apple/Microsoft, UPS/Fedex, Coke/Pepsi, Nascar/NFL? Well it would seem to be that those were the good old days of duopoly when there was at least a perception of freedom of choice even if free will had long been nudged off the electronic sidewalk by Cass Sunstein into oncoming traffic from a Detroit city bus running on diesel fumes but soon to be part of the greening of America… starting with Detroit.
Before you give Tesla and Professor Damodaran the thumbs up or thumbs down, let’s take a look at what is left in the wake of “The” non-electric car company legacy that is Motown 2.0 www.greeningdetroit.com. Here’s an excerpt from the Synergy Leaders page of their website presented with copious in-line commentary from Dave.
Synergy Leaders
GreeningDetroit.com pursues the attraction of leaders and experts from each group in what makes up communities and what makes up our website. “Pursuing the attraction?”…. now we’re getting somewhere. Dave had a dog one time who wouldn’t come back unless you ran from that dog… then he would chase you. As a sales manager Dave always trained his salespeople to be “the hunted” rather than “the hunter.” Looks like the first thing green leaders in Detroit have figured out is the importance of being attractive in their pursuits. Due to the massive spread of resources, we welcome the participating members of our Synergy Leaders to assist us in bringing to the surface what their part of the community or sector is working on, or in need of. This collaboration can only assist our communities as a united region. Dave would also “welcome you to assist me.” That’s Jerry Maguire at his best… help me help you… Cuba Gooding, Jr. won an award from the Academy for “digging” just such a strategery. As far as the “spread of resources” is concerned, Dave would agree with the descriptor “massive spread.” Dave’s a bit confused about that last sentence. Do you mean to say “this can only assist our communities” in the sense that only our community will be assisted? Or did you mean to say “this can only assist our communities” in the sense that “there’s got to be a pony in here somewhere”… just sayin’.We have handpicked experts and leaders of different sectors of the region that can work together, share ideas, find common ground through Synergies, and eventually create opportunities out of various communication tools and by discussions. Reminds Dave of those “hand-spun” milk shakes at Chic-fil-A, technically speaking they should say the cups are hand-spun because a machine actually spins the shake and it’s probably a machine that used to be made in Detroit, but now is made in Korea. Most of our members know each other, but it takes a short introduction of projects that they are working on, to spark common ground discussions. Awareness is the first accomplishment! Mission accomplished… eventually… without an aircraft carrier… now where’s that Staple’s Easy Button?
Again, our intended purpose is to proactively create larger systemic changes to our region by utilizing different sectors and collaborations. Dave clears his throat (cough)… umm… can you please repeat that? I’m taking notes. With the wealth of regional information that GreeningDetroit.com harvests on an ongoing basis, we can share this information of knowledge with our Leaders of different sectors. Involving our leaders from different sectors, to communicate with each other, can only strengthen our communities and our regional resources. There’s that same intention question again. In conclusion, did you mean to say that pursuing attraction can only strengthen your communities and re$ource$ in the sense that only your community strengthens its regional re$ource$? Or did you mean it in the sense that “creating larger systemic change” (i.e. a larger manure pile) is clear evidence that multiple ponies are in here somewhere?
http://www.greeningdetroit.com/synergy-leaders/
So, on the one hand we have entire city blocks of Detrot being dug up and returned to farm land through a devolutionary strategery of sorts while the United States government is privatizing its research and development initiatives through select monopolies such as Tesla. Professor Damodaran issues the ultimate caveat that we may have reached a “tipping point where size feeds itself.” If that is the case, and the 800 lb. gorilla can finally feed itself like a quantitatively eased paper bananas with a lifetime supply of free toner cartridges, then Dave would suggest that Tesla isn’t worth $67 or $167, but more like $670. I can almost hear you saying “Dave, I’m not emptoring (buying) that. This is just another hyped up Wall Street pump and dump scheme.”
Au contraire, in a less fed is well-fed and means tested is even better world, there can be little doubt that the well-intended folks at Greening of Detroit (the Acorn of economic engines), have an intended proactive purpose to create larger… uhh… systems, sectors and collaborations. You too desire to be pursued by the attraction of handpicked experts and hand spun leaders in an eventual effort to find common ground through synergies (i.e. various communication tools, various discussions) or at a minimum a better self-checkout line at Wal-mart where Erskine Bowles can be as certain as a Bitcoin block chain that you don’t head to the customer service counter for a refund and a quick trip to the Lotto machine or to Marlboro Country.
You may want to consider slogans of the previous feed itself class of companies and think for a minute about just what exactly have they been feeding themselves on. Take Dave’s feed yourself quiz by trying to match the official company slogans with the official company spokesperson. Just be careful when you make a proclamation that you’re going to “feed yourself” that they understand that you mean “feed yourself” in the sense of “Hey mom, Mikey fed himself the Life Cereal” rather than “Hey mom, Mikey fed himself to the 800 lb. gorilla he met on the internet.”
Dave’s When Size Matters It Can Feed Itself Quiz (please send this to your friends… because meta data matters only when it is super sized)
A. Don’t be evil while organizing the world’s information and make it universally accessible and useful while never crossing the creepy line with the help of your own private elevator and soundproofed apartment.
B. To make the world more open and connected while deciding what you would do if you weren’t afraid yet wearing a hood at all times.
C. Developers. Developers.
Match the letter above with the image below. If you get the answers correct, then you just fed yourself. Yum.
I. clue – “Raise your hand…. raise your haaaaand… if you’re Sure”
II. Clue – the one without the hoodie.
.
III. Same first name as Snowden. Second clue: Chose this as his Google+ profile photo. Third clue: Drew the creepy line on sound by soundproofing his new Manhattan apartment.
https://plus.google.com/u/0/+EricSchmidt/postsThe Tesla shots heard round the world:
http://aswathdamodaran.blogspot.com/2013/09/valuation-of-week-1-tesla-test.html
http://aswathdamodaran.blogspot.com/2013/09/tesla-follow-up.html
Edited by WD
Source
*P.I.G. = Prisoner Industrial Gulag.
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