Elon Musk Pulls An ICO

By Chris at www.CapitalistExploits.at

First up, this beauty received by one of the crew here at HMS Capitalist Exploits:

Marketing an ICO...

Killer!

The Tesla ICO

Speaking of ICOs, last week something amazing, breathtaking, and revolutionary happened. We had another ICO... the very first of its kind.

An Initial Car Offering.

Pundits said it was an unveiling of the Tesla semi truck, but we now all know it was actually a thinly veiled capital raise.

Like many good things in life, this also began with foreplay.

Customers and shareholders are like women ovens - they need to be warmed up first.

So a few weeks before launching the ICO, the oven was dialled up:

Amazingly, I woke up this morning and, though having watched the unveiling, I looked around me and couldn"t notice anything different (though my dog had this strange look in his eyes).

My mind was surprisingly still in my skull and had not been sent into an alternate dimension, which was disappointing as I was quite excited by the prospects of that.

Anyway, so once the engine was warmed, we were treated to the de-robing of this.

I thought at first I"d missed it. Then I watched it again. And no, I hadn"t.

There was zero explanation of how Tesla would get all the dough to build this creature, where it would build it, and how (given the competition all have existing production plants, positive cashflows, dough in their treasuries, and access to credit markets) Tesla miraculously thinks that by the time it gets there it will have all of these things as well as the technology (that does not yet exist) to pull it off.

But then my nerves were calmed when they offered a warranty on the product. Wait, what? A warranty BEFORE they have a product? Killer!

I guess there"s a first time for everything.

But that wasn"t to be all.

No, then came the real showstopper as Elon went a step further in prostituting promoting Tesla. The fastest sports car in the world. And it may even just fly.

The kid in me did backflips. I sooo want a car that flies. Don"t you?

But then I remembered that there was a time when I really wanted the Easter bunny to be real, too.

Now, being older and wiser, I realise that rabbits screw up your lawn and chocolates make you fat, and I want nothing to do with either of them.

What I would like to know is how they found the time to muck around developing both a sports car and a giant truck when they can"t get a little Model 3 out?

Maybe that"s just me being a grouch. Heck, what do I know about cars? Mine"s 5 years old and smells of kids sweaty football socks which are buried in the back there somewhere.

Thankfully, I didn"t have to wait too long to figure out how they intend to fund some of this:

Now, when I saw this I"ll admit to having made the sort of noise a cat would make if fed through a mangle.

I realised then that Tesla was trying to pull off an ICO.

You see, the thing with 99% of ICOs is they"re kinda like the deals on Kickstarter, which means that you don"t actually get anything. It"s more like a donation... or part of a rewards points system. You know, like your air points where you get to trade them for a flight to Greece for a dirty weekend away or to upgrade your flight to first class so you can sit next to all the folks who eat lobsters in their bathrobes.

This works spectacularly well for anyone uneducated in investment markets. And that, my friends, is perfect for Tesla. Because you know what?

That"s about 90% of the population.

For the other 10%, here are some things to consider.

I"ll gladly admit to not really knowing a lot about cars. I like them very much as long as they take me where I want to go and do all the cool things that modern cars do.

But try explain to me about all the ins and outs of the bits inside and my brain does that man thing - it stops working and starts thinking about sex.

But what I do know a thing or two about is numbers and markets. And frankly, when Musk starts talking about these things he may as well be speaking Nepalese and explaining how to cook a yak stew because it"s all complete gibberish.

Tesla by the Colours

Last week when we were staring at Margot Robbie (don"t tell me you didn"t stare), and we said:

It was overconfidence that led the pointy-shoed suits on Wall Street to package subprime mortgages up, believing that a pile of isht when added to other piles of isht through the magic of diversification turns isht into non isht.

Like Margot explained in the Big Short (and bear with me as I"m extrapolating here): If we use Wall Street logic, you take the colour red and add it to more red... much more... you can get green.

So let"s run through Tesla by the colours, and then after that we"ll run through it by the numbers. Sounds fair?

• SolarCity: Red


• Gigafactory: Red


• Model 3: What Model 3?


• Model 3 in full production: Red


• Tax credits: Green... ah isht... no, make it red

Excellent!

So red + red + red + red + red = Green.

Tesla by the Numbers

Let"s take Q3 cashflow and toss in interest charges for 2017 (which is only fair — after all, someone has to pay them).

With that we realise that Tesla burned through about US$1.7bn or about US$500m a month.

Now, let"s be super conservative and say capital expenditures remain at 2017 levels, which is absurd and impossible given the new initial car offering and that semi truck, too (it"ll be far higher).

Anyway, let"s give it to them.

Well, let"s say they can find 1,000 fools buyers to drop a quarter million bucks on a pre-order for a car that they hope to receive some years in the future. Let"s say they can do that.

That"ll put US$250m into Tesla"s treasury, which will buy them less than 3 weeks. Killer!

I"m going to go out on a limb here and say that in the first quarter of 2018 Tesla"s going to lose US$1bn. Crazy, I know. How long for? It"ll go on until it doesn"t.

And here"s something to think about...

Here"s Venezuela"s 5-year sovereign CDS spread:

You may ask, why Chris are you posting this in an article about Tesla?

Well, Venezuela — like Tesla — made promises it couldn"t keep.

What I"d really like to know from you today is this:

Cast your vote here and also see what others think will happen

- Chris

“If you wouldn’t be short a multi-billion-dollar loss-making enterprise in a cyclical business, with a leveraged balance sheet, questionable accounting, every executive leaving, run by a CEO with a questionable relationship with the truth, what would you be short? It sort of ticks all the boxes.” — Jim Chanos

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Tesla Unveils Its "Mind-Blowing" Semi And New Roadster, The "Fastest Production Car Ever Made"

Update 2: there were some rumors of a surprise during tonight"s presentation, and Musk did not disappoint when just as the semi-introduction was ending, Tesla also unveiled a new Roadster, the new version of its original sports car. According to Musk, It’s the fastest production car ever made, with speeds of just 1.9 seconds for 0 to 60 and 4.2 seconds for 0 to 100. It can handle a quarter mile in 8.9 seconds.

“This is the base model,” Musk said, then went on to mention that its top speed is above 250 mph. and it has a 200 kWh battery pack that offers 630 miles of highway driving range.

This just drove out of the Tesla Semi. A next gen Roadster!!!!! #TeslaSemiTruck pic.twitter.com/3gmyzhPHkl

— Lance Ulanoff (@LanceUlanoff) November 17, 2017

* * *

Update 1: this is what the new Semi truck, which Tesla will give a 1 million mile guarantee for, looks like:

This doesn"t look bad #TeslaSemiTruck pic.twitter.com/VrwHXb6qN8

— Madi ?????? (@Phalanxia) November 17, 2017

* * *

Tonight"s the night!! In what has been promised to "blow your mind," Elon Musk will unveil an all-electric Class 8 semi truck.

In the works for two years, it’s a project that’s aimed squarely at cleaning up the freight industry, which accounts for one-fifth of global oil demand... and which Goldman Sachs has warned will cost 300,000 jobs per year.

As Bloomberg notes, Chief Executive Officer Elon Musk has promised a truck that will “out-torque any diesel semi” and drive “like a sports car.” Seeing what an all-electric semi is capable of may be the most entertaining part of the night, even if it’s not a key metric for Tesla’s trucking customers.

It can transform into a robot, fight aliens and make one hell of a latte pic.twitter.com/8h9vvWu4f5

— Elon Musk (@elonmusk) November 15, 2017

“If you had a tug-of-war competition,” Musk bragged at a Ted Talk in April, “the Tesla Semi will tug the diesel semi uphill.”

The show is due to start at 8pmPT, 11pmET.

If the transmission is interrupted, readers can go to Tesla’s website by clicking the image below...

Here"s what to watch for - including some potential wild cards (via Bloomberg)

1. How Long Is Long Range?

The range of any electric vehicle is the critical metric—it defines how the vehicle can be used and the size of its potential market. Five years ago, few would have thought that a long-range heavy duty-truck was even possible. That’s changing fast. Daimler, the leader in Class 8 diesel trucks, recently unveiled a 220-mile range electric big rig, establishing a new bar for the industry. Long-range hauling across vast stretches of the U.S. would likely require more than 500 miles of range.

2. At What Cost?

Batteries are the single most expensive component of any electric truck, and the battery of a cross-country hauler could cost $100,000 even before you build the truck around it. The sticker price, regardless of size, is going to be higher than its diesel equivalent because of those pricey batteries.

Can Tesla keep the upfront price low enough to be offset by cheaper operating costs from fuel savings and simpler maintenance? Tesla may provide such figures, though many fleet operators will want to put them to the test with hundreds of thousands of road miles before they’ll be convinced.

Source: Bloomberg analysis

3. Platooning on Autopilot

Will the truck, expected to roll out by 2020, come with some level of autonomous driving? Tesla has been in talks with California and Nevada regulators about testing semis that can automatically follow a lead vehicle, a technique known as “platooning.” Platooning cuts fuel costs by reducing wind drag. And if the autonomous driving system is good enough to run without a driver, it could also dramatically cut labor expenses.

A teaser animation released by Tesla on Wednesday suggests the realization of one of Musk’s design aspirations: cameras instead of side door mirrors.

Tesla Semi unveil, 8pm PT tomorrow — watch live at https://t.co/8uVlhvzpu5 pic.twitter.com/hCIm5iCW6J

— Tesla (@Tesla) November 15, 2017

 

4. Who Are the First Customers?

The biggest players in freight are good at keeping their trucks in top driving condition and averse to messing with the supply chain. Convincing companies like Swift, Ryder, and Wal-Mart Stores Inc. to bring an electric drivetrain into their fleets will be a tough sell. Musk says Tesla has been gathering feedback from trucking companies throughout the development process (at least one, Ryder, confirmed it), so it would be a good sign if Tesla comes out of the gate with some early partnerships.

It could be that Musk’s own empire will be the first demonstration customer of the big rig. Tesla’s automotive reach is growing, and its SolarCity arm is the biggest rooftop solar installer in the U.S. Musk"s SpaceX could potentially use the vehicles to transport rockets, satellites, capsules, and equipment.

During earlier unveilings of Tesla’s passenger cars—the Models S, X and 3—the company started taking paid reservations immediately, at least 18 months before the first deliveries. Is that a strategy that can work with commercial trucks? How long until the first rigs hit the road?

A new 40-stall Supercharger station and customer lounge opens in Kettleman, California.

Source: Tesla

5. Infrastructure Solutions

A lot of infrastructure goes into servicing big rigs. Truck stops line the world’s highways, and fleet operators stand by with mountains of replacement parts ready to fix anything that might go wrong. How does Tesla plan to deal with these hurdles? Will they introduce a whole new type of charging system, with ultrafast chargers or a robot that swaps out used batteries for fresh ones? Who will build out and operate the charging network? Who handles maintenance and roadside assistance?

6. Location, Location, Location

Tesla’s car factory in Fremont, California, is running out of room. Musk wants to build 500,000 electric passenger cars there next year, and even if he misses that goal by half, it’s very unlikely Tesla would be able to squeeze in a big rig assembly line. Tesla’s massive battery factory near Reno, Nevada, which is still under construction, seems like a more natural fit. That factory is also where Tesla makes electric motors and drivetrains—primary components for an electric semi.

7. “Driver Comfort Features”

In a profile in this week’s Rolling Stone, Musk hinted at an unspecified “driver comfort feature” that he’s fond of. “Probably no one will buy it because of this,” he said, “but if you’re going to make a product, make it beautiful.” One possibility? A sweet coffee maker. In a Twitter post on Wednesday, Musk joked that the truck “can transform into a robot, fight aliens and make one hell of a latte.”

The Model 3 motor sits in line with the wheel axle. The semi will use multiple Model 3 engines in tandem to power the big rig semi trucks.

Source: Tesla

8. Shared Parts

Perhaps Tesla’s biggest advantage over other truck makers is that its Semi will share some core parts with its first mass-market car, the Model 3. Musk disclosed during an earnings call in May that the Semi uses “a bunch” of Model 3 motors, which sit in line with the truck’s axles. These relatively cheap electric motors will give the Semi unparalleled electric torque for getting quickly up to speed with a heavy load.

Tesla’s foray into commercial trucking is coming at an impossibly tough time for the company. The Model 3 is already months behind schedule, and Tesla is spending $1 billion a quarter to get things cranking.

But if Musk can get Model 3 production lines up to their promised rates, and the motors and battery cells are truly interchangeable between the Semi and the new passenger car, the scale of those operations would be profound. While traditional diesel truck makers are testing truck-suitable electric motors by the hundreds, Tesla could be making them by the hundreds of thousands—even before its first big rig hits the road.

*  *  *

Tesla shares have been on the downtrend since mid-September...

So this event could be just what Musk needs to turn things around and distract investors from the massive cash burn the company is suffering while hand-making Model 3s...

Musk Fires Back: Blasts "Hotbed Of MISinformation" In Racial Discrimination Lawsuit

A couple of days ago we noted a lawsuit filed against Tesla in the Superior Court in Alameda County which, among other things, alleged that his Fremont manufacturing facility was a "hotbed for racist behavior" in which employees and supervisors "regularly use the "N word."" Bloomberg summarized the case as follows:

Tesla Inc.’s production floor is a "hotbed for racist behavior," more than 100 African-American employees claimed in a lawsuit in which they alleged black workers at the electric carmaker suffer severe and pervasive harassment.

 

The employees are seeking permission from a judge to sue as a group and are seeking unspecified general and punitive monetary damages as well as an order for Tesla to implement policies to prevent and correct harassment.

 

"Although Tesla stands out as a groundbreaking company at the forefront of the electric car revolution, its standard operating procedure at the Tesla factory is pre-Civil Rights era race discrimination," the employees said in the complaint, filed Monday in California’s Alameda County Superior Court.

 

The lawsuit was filed on behalf of Marcus Vaughn, who worked in the Fremont factory from April 23 to Oct. 31. Vaughn alleged that employees and supervisors regularly used the “N word” around him and other black colleagues. Vaughn said he complained in writing to human resources and Musk and was terminated in late October for "not having a positive attitude."

But, in an angry blog post published on Tesla"s website, the embattled electric car darling has fired back saying that media reports of a "hotbed of racist behavior" at Tesla are nothing more than a "hotbed of misinformation" spread by a trial lawyer who "has a long track record of extorting money for meritless claims and using the threat of media attacks and expensive trial costs to get companies to settle."

There are a number of other false statements in the class action lawsuit alleging a so-called “hotbed of discrimination”:

 

- There is only one actual plaintiff (Marcus Vaughn), not 100. The reference to 100 is a complete fabrication with no basis in fact at all.

 

- The plaintiff was employed by a temp agency, not by Tesla as claimed in the lawsuit.

 

- Marcus was not fired, he was on a six month temp contract that simply ended as contracted.

 

- His email to Elon was about his commute and Tesla’s shuttles, which was addressed as he requested. There was no mention of racial discrimination whatsoever.

 

- The trial lawyer who filed this lawsuit has a long track record of extorting money for meritless claims and using the threat of media attacks and expensive trial costs to get companies to settle. At Tesla, we would rather pay ten times the settlement demand in legal fees and fight to the ends of the Earth than give in to extortion and allow this abuse of the legal system.

Given those silly fiduciary duties he has as a Tesla board member, Elon may not want to openly flaunt his willingness to "pay ten times" more in legal fees just to settle a personal vendetta...just a thought.

Meanwhile, Elon also decided to address a portion of a firm-wide email published by Bloomberg suggesting the Tesla employee who felt discriminated against should have been more "thick-skinned" by publishing the entire email that, in fact, confims that Elon said the guy should be more "thick-skinned."

We would also like to clear up the description of Elon’s prior email to employees. It is dedicated to ensuring that Tesla employees always try to do the right thing, that being a jerk is not allowed, that everyone should be contributing to an atmosphere where people look forward to coming to work in the morning and that no one should feel excluded, uncomfortable, or unfairly treated. As one of many points in that email, Elon also explained that if someone makes an offensive or hurtful statement on a single occasion, but subsequently offers a sincere apology, then we believe that apology should be accepted. The counterpoint would be that a single careless comment should ruin a person’s life and career, even if they truly regret their action and do their best to make amends. That would be a cold world with no forgiveness and no heart.

Of course, somehow we suspect that Tesla shareholders would prefer that Elon focus on learning how to weld rather than spend his time publicly responding to what he clearly views to be a "frivolous" lawsuit.

What Will Stabilize Used Vehicle Sales? (Hint: Nothing Good)

Authored by Daniel Ruiz via Blinders Off blog,

Until this point, a lot of what I"ve shared with you is theoretically based on my knowledge and experience of used vehicle values and how I believe they affect new vehicle sales velocity. Today, I am going to share some some hard data that I"ve been researching with a great deal of effort.

I genuinely believe that used vehicle values have a very significant effect on new vehicle sales velocity. I have explained it on Twitter and on a previous blog post through the concept of trade cycles. Because of this, I am certain that used vehicle values can be used as a leading indicator for inventory management at the manufacturing level, at the retail dealer level and certainly as an investment tool. However, I humbly hold that current used vehicle value indexes sources are not good enough.

There is a very specific group of vehicles that can be monitored in order to better project results. The Manheim and NADA index both have too much noise in the data. For example, the Manheim Index has no model year restrictions and includes new vehicle price inflation in the calculations. NADA goes up to 8 model years. Both average the data over multiple months and include vehicles which, in my opinion, have little to no impact on new vehicle sales velocity. Therefore, I have decided to make my own index.

For now, I"m going to use Ford as an example please ignore the red residual line until later.

I have said numerous times that passenger vehicles are at a different points in the value cycle than trucks and SUVs.

This is common knowledge at this point, and most have placed their faith on trucks and SUVs. This includes manufacturers shifting production and rental car companies changing their fleet mix to the better performing SUV and truck sector. Most analyst are looking at fuel prices to mark the top of the SUV and truck market. Here"s what they"ve missed:

Here"s WHY this matters:

Now back to residuals. What I want to drive home, in simple terms, is that assuming no change in demand, supply precedes price changes. When used vehicle values underperform residual values, the return rate of leases goes up. The opposite is also true. Less vehicles returned means less auction volume supporting higher prices. More vehicles returned means more auction volume supporting lower prices. Look at the charts again and note the acceleration of used vehicle value declines when used vehicle values fall below residual values. So where do we stand today? You tell me if this looks supportive of higher used vehicle values:

You might wonder what will stabilize used vehicle values going forward. Consider this, a used vehicle is nothing more than a new vehicle transaction that drove off the dealer"s lot.

The answer, years of declining new vehicle sales and we are just getting started.

If you feel that my insight might be a useful part of your investment decisions in the automotive sector, I offer phone consultations as well as in-person presentations through GLG.

'Inconvenient' Fact: Morgan Stanley Says Electric Cars Create More CO2 Than They Save

For all the funds out there looking to fill their portfolio with "environmentally conscious" companies working diligently to avert an inevitable global warming catastrophe that will result in the extinction of the human race, we guess in lieu of their actual fiduciary duties to simply make money for their investors, Morgan Stanley has compiled a list of how you can get the most "environmental healing" per dollar invested. 

As MarketWatch points out, it"s not terribly surprising that of the 39 publicly-traded stocks analyzed, the solar and wind generation companies landed at the very top of Morgan Stanley"s environmentally friendly the list. 

Morgan Stanley identified 39 stocks that generate at least half their revenue “from the provision of solutions to climate change,” something it said was a central component of investing to make a difference, as opposed to just a making a buck.

“In our view, impact investing needs to begin with companies whose products and services have a notable positive environmental or social impact,” wrote Jessica Alsford, an equity strategist at the investment bank.

Not surprisingly, alternative-energy companies ranked the highest in terms of their positive impact, and the “top five climate-change impact stocks” were all manufacturers of solar and wind energy: Canadian Solar, China High Speed Transmission, GCL-Poly, Daqo New Energy, and Jinko Solar.

What is surprising, however, is that publicly traded electric car manufacturers, darlings of the environmentally-conscious Left, were actually found to generate more CO2 than they save.  As a stark reminder to our left-leaning political elites who created these companies with massive taxpayer funded subsidies, Morgan Stanley points out that while Teslas don"t burn gasoline they do have to be charged using electricity generated by coal and other fossil fuels.

This is where Tesla, along with China’s Guoxuan High-Tech fall short.

“Whilst the electric vehicles and lithium batteries manufactured by these two companies do indeed help to reduce direct CO2 emissions from vehicles, electricity is needed to power them,” Morgan Stanley wrote. “And with their primary markets still largely weighted towards fossil-fuel power (72% in the U.S. and 75% in China) the CO2 emissions from this electricity generation are still material.”

In other words, “the carbon emissions generated by the electricity required for electric vehicles are greater than those saved by cutting out direct vehicle emissions.”

Morgan Stanley calculated that an investment of $1 million in Canadian Solar results in nearly 15,300 metric tons of carbon dioxide being saved every year. For Tesla, such an investment adds nearly one-third of a metric ton of CO2.

Ironically, as we recently pointed out, Zero-Emission Vehicle (ZEV) credits (a nicer way of saying taxpayer funded corporate welfare) is pretty much the only "product" that Tesla seems to make money selling and is the only reason they managed to "beat" earnings in Q2.

I"m referring to zero-emission vehicle, or ZEV, credits. California and several other states require that a certain proportion of the vehicles sold by an automaker emit no greenhouse gases. These cars earn the automaker credits, and if they don"t have enough to meet their quota, they can buy extra ones from someone who does. As Tesla only makes vehicles that run on batteries and emit nothing, it usually has a surplus for sale.

The profit margin on these is very high, perhaps 95 percent. The implied $95 million of profit equates to about 58 cents a share. Tesla reported a loss of $1.33 per share this week -- beating the consensus forecast by 55 cents.

This isn"t the only time ZEV credits have played a big role for Tesla. Looking back to early 2013, selling credits has given Tesla"s earnings extra oomph in many quarters, likely taking them above consensus forecasts in some (on an implied basis, assuming that 95 percent margin):

Of course, Q2 wasn"t the first time that ZEV credits played a huge role in padding Tesla"s cash flow...

Ponder that for a moment...as taxpayers we"re actually subsidizing a product (and an eccentric Silicon Valley billionaire) that is bad for the environment...

Musk And Macron: The Darned Craziest Things You’ve Ever Seen!

By Chris at www.CapitalistExploits.at

I Think Tesla is Enron On Wheels, OK?

Most readers are silent, agree, or have no opinion but one or two are upset with me. It"s gonna happen with 10,000+ subscribers.

Criticism basically comes down to this:

1. Tesla is breaking new ground and we need innovation. Sorry. What? Insider subscribers are going to get a full run down on this shortly. Nothing proprietary here folks. Nothing. Please learn to fact check.


2. I"m jealous of Musk, a hater, and just being mean as a result. Two responses to this: 1) hahahaha 2) muhahahaha.


3. Musk and Tesla (nobody seems to be able to separate the two) are way more than a car company. They"re a friggin technological innovation company combining software with hardware and sheer genius to solve real world problems... or something like that.

Mmm... People are so god damn gullible. Dolly birds on the idiot box interview Musk, swooning like schoolgirls on heat, and chumps shareholders who, hypnotised by a strong jaw and ever grander distractions (solar roofs anyone?), remain in awe... and look, they"re being proven right.

Not too shabby for a company that has reported INCREASING LOSSES ever since it crawled out of the womb. $330 million in the first 3 months of this year - a new record. I"ve a feeling Tesla is going to make the record books for all sorts of reasons.

Let me remind you that this charade makes no money, probably never will, and continues to survive by sucking on two tits. One is the "feral guvmint" tit and the other is the equity markets.

That Tesla is currently the most valuable car company in America is proof that Einstein was right all along:

Far as I can tell Tesla is flying because on the Model 3 coming out. I wonder... will all this matter when in 6 months time some analyst at, say, Morgan Stanley (the current note holders of Elon"s borrowed money, which is in turn invested in Tesla stock) take a closer look and find that "oh isht, they lose money on every Model 3 they make"?

Maybe. Maybe not.

“Markets can remain irrational longer than you can remain solvent.” ? John Maynard Keynes 

Hooray... Populism Defeated

So says the Financial Times.

But is it true?

Let"s not forget that this is the first time in modern French history that no major party candidate even made it to the playoffs.

Let"s do some math.

The abstention rate was reportedly 26%, the highest since WWII, and on top of that a whopping 4.2 million Frenchmen and Frenchlasses deliberately cast invalid votes.

This is one extremely divided country.

Le Pen managed to gather up 11 million votes, the highest amount ever for the far right in France.

According to the exit polls, up to 45% of voters who voted for Macron did so in order to block Le Pen but said they don"t support him or his program. His program, I will remind you, is pro-European Union.

So if we tally up the invalid votes cast, the abstention of 26% and the 45% who closed their eyes, blocked their noses, and voted for Macron, we find that only 25% of France actually supports France"s most recently crowned podium donut.

Markets reacted unsurprisingly.

Here"s the trees:

And here, folks, is the forest:

Meh...

None of this changes the fact that the everything I detailed in "7 Steps To The Easiest Short In Recent History" remains firmly in place.

What Else?

Bitcoin. Take a look:

A clean breakout from the channel with $2,000 around the corner. But you already knew that cuz you"re a reader.

Have an excellent week!

- Chris

"Markets can remain irrational longer than you can remain solvent." ? John Maynard Keynes

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How Volkswagen Quietly Stashed Half A Million Rigged Cars Around The Country

Volkswagen bought back hundreds of thousands of emissions-cheating cars. We just discovered what it has done with them all...

As Bloomberg reports, the German automaker agreed last year to buy back about 500,000 diesels that it rigged to pass U.S. emissions tests if it can"t figure out a way to fix them. Except for a handful of 2015 models, VW dealers can"t sell the cars until - and unless - the company comes up with repairs to satisfy regulators. The question they face then is - what to do with the hundreds of thousands of diesel cars it is being forced to buy back?

Well, now we know... the company is hauling them to storage lots across America...

VW spokeswoman Jeannine Ginivan said "the program is unprecedented in terms of its size and scope and we have devoted significant resources and personnel to help ensure that it is carried out as seamlessly as possible."

As Jalopnik"s David Tracy reports, after a bit of hunting on forums, and a couple of tips from readers and friends, I seem to have found three such “regional facilities”: one in Pontiac, Michigan; one in San Bernardino, California; and one in Baltimore, Maryland.

The Pontiac Silverdome is a bit of a shitshow in southeast Michigan. It used to be the proud home of the Detroit Lions and the Pistons, and it was even the venue for Super Bowl XVI, multiple NCAA tournament games and some FIFA World Cup matches. But now the huge building lies dormant, with its interior decaying and its parking lots cracking after years of neglect. This makes it the perfect place for VW to stash their bought-back TDIs.

See here for more images...

On a remote part of Norton Air Force Base (in San Bernardino, California), which has been decommissioned for over 20 years now, as is now part of the San Bernardino International Airport, lie thousands of California-plated Volkswagens and Audis awaiting their fate...

Google Street View even has the images..

See here for more images...

The Port of Baltimore is stuffed full of Volkswagens waiting to die. As one Jalopnik readers noted "a total of five storage lots with what had to be thousands of cars, ranging from older Mk5 Jetta models to high line Audi A3s, Passats and MQB Mk7 Golfs and a huge quantity of Jetta Sportwagens... Several of the lots stretched much farther than I could see."

See here for more images...

The images above bring to mind the apocalyptic scenes from "where cars go to die" during the last crisis in America, but for VW, this seemed to sum it all up nicely...

"The public doesn’t realize the monumental undertaking that they’ve pulled off to do this in a year and a half," said Matthew Welch, general manager of Auburn Volkswagen near Seattle.

"Nothing like this has ever been done."

And while VW has only itself (and government regulations) to blame for this scene, we wonder how long before we see the same images for GM vehicles... after all, with inventories at 10-year highs as sales start to collapse, we are feeling a terrible sense of deja vu all over again...