I'm on record saying that I think something very strange and wrong is going on with Amazon. There are just too many similarities to past scams for me to let it pass unsaid. The PE is astronomical and the charismatic Bezos has all these grandiose plans of taking over the world by getting involved with every new tech that comes along and in the case of Whole Foods, of taking on a well established infrastructure. If it were so easy why hasn't it already been done? Well with Amazon I don't know what is really going on but I have also noted fishy item listings showing up where the price listed is many multiples the retail value. All of this is happening as other retail operations like Nordstrom's are well off their highs and staring a 3rd wave down in the face.
So why does this sound so much like Tesla? You have the same type of charismatic leader who has his fingers into many businesses ranging from solar panels and batteries to electric cars to space exploration to digging tunnels underneath Los Angeles. None of these ventures are profitable. They are all sort of elite focused. The average person cannot buy a Tesla yet Elon Musk pitches Teslas as technology for the masses. These games will come to an end soon because too many people are now doing the math and other critical thinking that will expose any lies which might have been floated in order to keep all of these elitist dreams alive.
One analysis in particular that I think is illuminating can be found here at Seeking Alpha by a relatively unknown contributor named Donn Bailey. Essentially, Tesla's building very expensive cars that everyone likes and wants but that nobody has the cash to buy. Tesla's are a luxury item in a world where the middle class has slid off a cliff. So in order to kick the can down the road in the hopes that more people will suddenly get rich enough to buy their pricey inventory, Tesla seems to be creating a service loaner fleet which seems like it can almost handle all Tesla owners having their cars in the shop at the same time. OK that might be a exaggeration but you get the point. And each loaner vehicle is a maxed out high end model instead of a strip down version. That is not an exaggeration, it is Tesla policy according to Musk. This is what I would do if I wanted to act like I had higher revenue than I really did. I would pack cars full of high margin features that nobody in the real world can afford and then park them somewhere out of view after claiming the bloated MSRP was the selling price and accounting for it as revenue.
Either real buyers step up soon or Tesla risks being labeled a Ponzi. Unfortunately, we are already at full employment. So it's not like we are at the end of a down economic cycle that has made it difficult for Tesla to move cars. In fact quite the opposite. We are at the peak of a cycle and selling pricey toys to a struggling consumer base which is getting more conservative by the day is only going to get more difficult from here. So I am coining a new term here for my readers: "teslazon". It means "a company whose actions are out of line with normal economic reality but which hides it all in plain sight because of the bold strokes of a charismatic and well liked leadership figure". Usage: "AOL was a teslazon and its purchase of Timer Warner was the shark jump".
Tuesday, July 11, 2017
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