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Hertz, the original meme stock, is turning out to be worthless

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Re: Hertz, the original meme stock, is turning out to be worthless

#311

Post by elif »

mikestew wrote: post #158
Judgmentality wrote: post #91

Earlier quoted context omitted.

> The industry shift towards electric vehicles is because it's finally becoming profitable to make them. This is largely due to a dramatic reduction in battery costs which is driven by R&D for smartphones, not cars. Personally I don't believe Tesla has much to do with it. As much as I agree with the rest of your comment, I have to disagree with this part. Yes, there is a shift towards profitability with electric vehi…

Their tooling is set up for it. You know what else "their tooling is set up" for? Being changed in a short period of time for whatever the next hotness is. But I genuinely believe they are responsible for bringing EVs to market ~3 years before it would have happened without them. How do you reconcile that statement with the fact that while folks were waiting for Tesla to fill their Model S pre-orders, we were already…

I paid $5000 for my leaf.

Teslas maintain most of their retail value.

There's a reason. If leafs were the archetypical EV, public perception of EVs would be leafs. Which are garbage.

Re: Hertz, the original meme stock, is turning out to be worthless

#312

Post by elif »

ludocode wrote: post #77
elif wrote: post #44

Earlier quoted context omitted.

TSLA is crashing because TSLA is not worth more than the rest of the top 10 manufacturers combined, as their market cap would suggest. Other notable differences include actively building the largest and most advanced factories on every major continent, disrupting the entire automobile industry such that even jaguar is going full electric by 2025, mainstreaming self-driving, and cutting the costs of residential solar…

> actively building the largest and most advanced factories on every major continent They are not the most advanced factories, not even close. Tesla uses much more human labor per vehicle than its competitors; the "alien dreadnought" never materialized. "Toyota remains well ahead of Tesla in terms of manufacturing efficiency, producing more vehicles per employee, while utilizing its fixed assets and inventory more ef…

Find another factory which produces something as advanced as a car, which also produces its own battery cells, produces its own motor, and I'll consider it as advanced of a factory. Giga factory is a revolution in manufacturing that cannot be encapsulated in your efficiency metrics.

Also consider that the tesla gigafactory will build the entire frame and body of the vehicle as one part in under a second. Nothing close to this is being done, because the machines to do it are being invented for tesla.

If you'd like to discuss your other points with me, i'm down. But I don't like the "I disagree with every one of your points so here's a pdf" format

Re: Hertz, the original meme stock, is turning out to be worthless

#313

Post by ksdale »

chii wrote: post #291
ksdale wrote: post #171

Earlier quoted context omitted.

I like that Graham quote, and you make good points. I guess when I say "investing," I mean more like - Purchasing an equity entitles you to a share of that business' income and potentially assets, but if you buy the equity on the stock market, you're not actually investing in capacity, the way you would be if you bought an IPO or even just a piece of equipment you could use to make something. And I think people have…

> you're not actually investing in capacity, the way you would be if you bought an IPO or even just a piece of equipment you could use to make something. while you are not directly investing in capacity like you might in an IPO, purchasing stock does create the same outcome. It's just not _you_ who is doing the capacity investing directly, but someone else who does so, as a result of the chain of investments.

It doesn't necessarily though. When I buy an IPO, my dollars go straight (kind of) into a company's bank account. When I buy stock on the market, my dollars go to whoever I bought the stock from, who will probably use those dollars to buy more stock. The only time a company ever receives dollars it can use is when it sells stock to the public or gets a loan, and the vast, vast majority of transactions on the stock market do not involve dollars going to anyone who will use them to invest in capacity.

Re: Hertz, the original meme stock, is turning out to be worthless

#314

Post by jl2718 »

eafkuor wrote: post #240
jl2718 wrote: post #66

Earlier quoted context omitted.

But... “the markets will remain irrational longer than you will remain solvent”

Doesn't this only apply to short selling? How does that apply if you are just buying stock to hold long term?

Surely short selling is more relevant, but the ‘weighing’ machine is basically irrelevant compared to speculation. For instance, what companies paid the most dividends over the last 20 years? Are those the companies with the highest valuations over that time? How long of a time horizon do you need to show cash flow value from an investment versus speculative gains? I’m going to pull out my crystal ball and predict that today’s biggest companies in market cap will have below-average dividend performance for the next 20 years compared to the rest of the S&P.

Re: Hertz, the original meme stock, is turning out to be worthless

#315

Post by benibela »

renewiltord wrote: post #186
0xy wrote: post #144

Earlier quoted context omitted.

Hertz in official filings: "Hey guys, this stock is most likely totally worthless" Meme stonk buyers: buys stock Hertz: "Hey guys, here's some new stock. Remember we disclosed that it's likely totally worthless" Meme stonk buyers: continues buying worthless stock Meme stonk buyers: "How could you do this to us?"

Actual last few lines are actually look like the following. Meme stonk buyers: Guys, look at this loss porn. I lost $2.5 mil on Hertz LMAO my trust fund is gone. Other meme stonk buyers: HAHAHA you fucking retard Third party worrywarts: How could we let this happen?

It was worth it for the internet points

Re: Hertz, the original meme stock, is turning out to be worthless

#316

Post by vkou »

gpapilion wrote: post #303
vkou wrote: post #189

Earlier quoted context omitted.

> How was selling more stock in that situation legal? Why should it not be? Consider the following situation: 1. Alice owns 5 shares of Hertz. 2. Hertz owns 5 shares of Hertz. 3. Bob is an ape. For some stupid reason, Bob wants to buy 5 shares of Hertz. Is it immoral or illegal for Alice to sell her 5 shares to Bob? If not, why should it be immoral or illegal for Hertz to do so? Especially if they are up front about…

The key difference is Hertz created the five shares out of thin air. So Alice now has a diluted position.

A diluted position in a firm that is now more valuable, because it is less likely to be completely eaten by creditors, who will leave the shareholders nothing.

If this were a problem, then companies would not be allowed to dilute shares. They are, though.

Would you rather own all the shares of a worthless company, or some of the shares of a company with a value > 0?

Re: Hertz, the original meme stock, is turning out to be worthless

#317

Post by vkou »

Spooky23 wrote: post #297
vkou wrote: post #296

Earlier quoted context omitted.

It's immoral for Alice to sell cigarettes to a minor, and it is also immoral for Reynolds to do so, so the analogy doesn't work. Since, uh, nobody has an issue with regular stock holders selling their shares to other stock holders. If Bob is not 'sophisticated' enough to be allowed to buy shares of Hertz regardless of who is selling them , then sure, prevent him from buying. Delist the stock. Require you to be an acc…

Just like RJ Reynolds and Joe Camel, the Hertz management knew that their share offering was targeted at investors ill equipped to make a rational decision. It is bad faith and fraud. The prevalence of the “it’s just the market” argument and corresponding ethical gap here is disturbing. Read the Ben Horowitz “why I didn’t go to jail” post that was reposted earlier this week. End of the day, everyone who signed off on…

So, why is Alice selling her shares to Bob, who is clearly an idiot for paying good money for shares in a bankrupt company not a trade made in bad faith?

In fact, if Hertz sells enough shares, they are no longer bankrupt - which actually makes buying their shares with the intent to hold a rational decision. That's not why Bob is buying them, though, he's buying them because it's a meme stock, and he, I guess, wants to buy meme stocks. He not so unsophisticated that he fails to understand that Hertz is a shitty company.

Why are we protecting him from Hertz, but not from Alice?

Re: Hertz, the original meme stock, is turning out to be worthless

#318

Post by tomjakubowski »

rjbwork wrote: post #187
tomjakubowski wrote: post #175

Earlier quoted context omitted.

I never understood how stock market options worked (calls, puts) so I've spent a few dozen dollars buying various stupid out of the money options and following them (and then, agonizing over when to sell!). This has made me understand "the Greeks" better than any textbook alone could have done.

Yup. You gotta pay your tuition to the school of hands on trading for sure. It took quite a while for me to really grasp how they can all work in concert to move a position for and against you even if you are ostensibly right or wrong in your overall thesis.

It's fun to consider, "why's my counterparty selling this?"

Re: Hertz, the original meme stock, is turning out to be worthless

#319

Post by ineedasername »

ineedasername wrote: post #307
dragontamer wrote: post #266

Earlier quoted context omitted.

A more logical option is to wait for Hertz to inevitably go bankrupt, and THEN invest $5 billion into them. Under no circumstances is it better for the new investors to pay billions before the bankruptcy.

If you mean waiting until the bankruptcy proceedings are over, then waiting isn't always necessary. Lots of investors make high risk investments to companies in bankruptcy with bridge funds to carry them through the process. The "under no circumstances" clause is not necessarily the case. If it's a large enough company and investors can get their investments to be senior debt, then it can be a reasonable, if still hi…

>slow redemption = "allow redemption"

Re: Hertz, the original meme stock, is turning out to be worthless

#320

Post by horsemessiah »

throwaway5752 wrote: post #47

It's not worth discussing BTC, TSLA, GME, or HTZ. That is missing the forest for the trees. The degradation of even the appearance of an orderly market is the story. The money movement (volume of excess trades X magnitude of price change) seems out of reach of unleveraged retail. Faith in private and public institutions is justifiably poor, but also under organized attack. This is going to end badly for everyone, exc…

Americans always love tying things back to attacking China.
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