WASHINGTON, June 21, 2016 – In a breathtaking act of hubristic grandstanding, taxpayer-funded Tesla’s (symbol: TSLA) media-proclaimed genius Elon Musk launched a $2.8 billion bid by that company to take over solar panel purveyor Solar City (SCTY) to the tune of $26.50-28.50 per share. The interesting part: Musk just coincidentally happens to be the controlling shareholder of SCTY.
Not surprisingly, Tesla shares tanked in after-hours trading Tuesday while SolarCity shares soared.
The Maven admits to being entirely gobsmacked by the sheer audacity of this proposed transaction, supported as it clearly will be by a massive pile of taxpayer largesse. It’s all courtesy of the business brain-dead Obama Administration, which has also championed other brilliant but now bankrupt “green” businesses over the years like Solyndra and battery-maker A123—all with money from you and the Maven. Money neither you nor I will ever see again.
It’s easy-come, easy-go with these fiscally clueless idiots. After all, it’s not their money. Nothing to see here, folks. Move along.
The Maven is piping up on this one today since he’s long been disgusted by the adulation lavished on Musk by the lapdog media who willfully fail to grasp the simple fact that this “financial genius” has yet to make a dime on pie-in-the-sky Tesla, whose very existence depends on continuing, massive taxpayer subsidies paid out for each of Musk’s money-losing white-elephant autos—subsidies that enable the idle, mostly-Hollywood rich to buy Tesla’s status-symbol, virtue signaling vehicles at a fraction of the high price they could all afford anyway.
The entire company is likely the largest taxpayer-funded Ponzi scheme of all time. All we need is just one 4-year term with a fiscal conservative in the White House and Musk, Tesla, SolarCity and millions—perhaps billions—of taxpayer dollars will go right up in smoke. It would be an appropriate fate, too, since that money should have never been wasted on this Fantasy Land car to begin with.
We don’t have enough time in the day to get into the deeper meaning of this nonsense. Let it suffice to say that these two money-losing companies are yet another example of why global warming climate change alarmism is nothing more than a massive fraud invented to make the wealthy wealthier at everyone else’s expense. It’s pretty much left-wing Democrats and industrialists who control companies like Tesla, the defunct Solyndra, et. al., but indulge their eco-fantasies by funding them with taxpayer money, not with their own. The lapdog media will never tell you this, so the Maven is letting you know about it right here and right now. (He can already sense the armada of FedEx trucks lumbering his way loaded with DOJ-generated subpoenas.)
On other fronts, markets were open again today as usual, but nothing much happened. Averages closed slightly up today, although many stocks (including most of the Maven’s portfolio) were down today, particularly in resources and materials, both of which rallied Monday on word that British pollsters detected another voter shift over the weekend, this one tilting back in favor of a Thursday “remain” vote re: the Eurozone rather than the previous surge toward the “Brexit” gate.
That said, the outcome of this UK vote is still very much in doubt, something the market seemed to be telling us Tuesday as selling pressure remained steady throughout the day despite the final results.
We lightened up a bit on our gold and silver ETFs this afternoon, which also moved against us given the alleged Brexit sentiment change. We’d thought we might get another day or two move here, but we guessed wrong. Precious metals, which have been range bound now for the better part of two years due to clear central bank and government manipulation, looked poised to break out of their range. But again, they failed to do so, and we should have taken our meager profits while we still had them.
Our big position in Allergan Preferred shares (AGN/PRA) is in the middle of another cyclical move down after exceeding our highest purchase price last week. This damages the portfolio short term. But if it drops near or below its most recent lows, we’ll just buy more. It’s almost always foolish to load up on a single position like this. But with this time-limited preferred stock set to be redeemed at full price in March 2018, we figure it would take nothing short of an actual Armageddon to destroy the preferred stock’s underlying company—one of the world’s major pharmaceuticals—so we figure it’s worth the chance.
On the other hand, our brave little mass of Teekay Tankers shares (TNK) was itself tanking once again Tuesday, blipping around at breakeven but way down from our average purchase price. That’s because of the Brexit nonsense, we think, whose allegedly rebounding “remain” vote caused pretty much all resources and resource stocks to take a hit.
Thursday’s vote will be the climax. As always, when a potential Black Swan event looms, we’ll be on the road for a week starting Friday, headed for places that annoyingly seem to have the worst Internet connectivity in the country. Since we won’t be able to mother-hen our positions, we’re trying to get most of them hedged before we head to the Outer Limits, No-Trading-Possible zone. It’s one problem you have to put up with in a trading account.
We’d love to get back to buy-and-hold. But frankly, that’s a way to get easily slaughtered in a stock market that no longer is being permitted to run on fundamentals.