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Blue Skies In Shortville

Elon Musk is finally making it rain for Tesla bears.
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There are two logical endpoints for Tesla Motors. In one, the dream is achieved. Every John Q. Motorist in America drives a Model N by day, plugs it into his SolarCity powercell by night, and statues go up the world over celebrating Elon Musk as savior of the climate, the auto industry, and of course, TSLA stockowners.


The only other conceivable conclusion to the Tesla story is a tragic one. Rushed production schedules yield shoddy and unsafe results. Rivals move effortlessly onto Tesla's turf. In a last-ditch effort at relevance, Musk pulls some crazy stunt – say, attempting the first transcontinental drive by Autopilot – and meets a grisly end. Emblazoned on his tombstone:

This is the inevitable result of this kind of brazen corporate hubris. Anything you say can and will be used against you, the more extreme the better. Elon hasn't done himself any favors on this front, which makes the schadenfreude all the more acute on weeks like these:

Tesla’s shares are down 14% this week, including a 4.4% fall on Thursday morning, on pace to be its worst three-day stretch since February of last year. That means the short sellers are up big. They earned $248 million in paper profits on Monday and $704 million on Wednesday, according to S3 Partners, a financial analytics firm. They were up another $254 million on Thursday in morning trading, pushing the weekly paper profits to $1.2 billion.

Of course, the thing about selling dreams is there's no way to kill em. You can quibble with Tesla's math, but you can't argue with the ineffable.

Tesla Shorts Rake in More Than $1 Billion as Stock Falls [WSJ]



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