by Shane Ormond
On May 10, 2019
Earlier this month, it seemed like the Chinese trade negotiations would come to an amicable end any day now. But after some unexpected pushback from Beijing, the U.S. is ratcheting up the pressure with tariffs of 25% on more than $200 billion of Chinese goods.
- Teslend Me Your Car: Elon Wants to Start a Taxi Company With Your Car
- The Night of the Living Dems
- The Real Tide Pod Challenge: Quarterly Growth
- Seven Years Until Medicare Explodes
Teslend Me Your Car
Elon Wants to Start a Taxi Company With Your Car
Elon Musk took a break from rapping about memes yesterday to makes some bold claims at the Tesla Autonomy Investor Day in Palo Alto, California.
Elon, who will become a full cartoon any day now, told investors that buying any car other than a Tesla today “would be like owning a horse.”
“I mean, fine if you want to own a horse,” said Elon. “But you should go into it with that expectation.”
DISCLAIMER: If you want to own a horse, buy a horse. They won’t allow you to enter your Ford Fiesta into the Kentucky Derby.
The man who would rather be on mars predicted that by this time next year, over 1 million Tesla vehicles will be upgraded to have full driverless capability. And he has a plan to turn those robocars into some much-needed revenue for his $59 billion money-hemorrhaging machine.
Dude, Where’s My Car?
On stage at the Palo Alto event, Musk announced plans to drag Tesla kicking and screaming into the rideshare game with a fleet of self-driving robotaxis.
Well, a fleet of robotaxis… and your car as well if you’re not using it, please.
If there’s one thing we know about Tesla, it’s that its notoriously bad at meeting production goals. Which makes a “fleet of robotaxis” unlikely anytime soon.
Which is why Elon would like to lease your Tesla back from you and use it as a taxi. When you’re not driving your car, it will be zipping around town, taking drunk people home, and hopefully not getting any speeding tickets. (It’s about damn time my car got off its ass and got a job.)
Elon plans to offer a similar deal to its no-drivers as Uber and Lyft offer their drivers. Tesla would take a 30% cut of the revenue, while car owners would get a lion’s share of 70%.
Tesla is predicting your car-about-town will make an estimated $30k on average, which would bank Tesla owners an extra $21k a year.
The current Tesla car line ranges in price from $42,900-$137,000 (before tax incentives for electric cars). Which means a top of the line Tesla could be working the streets for years before it pays itself off.
Tesla has plans to sell the new Model 3 Tesla for $35k (plus an extra $4k to “activate” autonomous driving). Which starts to make a little more financial sense… if Musk’s predictions are right.
Which, you know, they usually aren’t.
Over the years, Tesla’s investors have learned to take Musk’s predictions (and dumb Twitter feed) with a pinch of salt. By now, the bolder Musk’s claims, the more wary investors become. (It’s the classic story of the boy who cried “taking Tesla private at $420. Funding secured.”)
Following Elon’s bold announcement that he’d like to borrow your Tesla to start a taxi company, Tesla shares fell sharply, closing the day 3.9% down.
Would you let strangers take rides in your robocar for $21k a year? Click here to send me your answers.
No More Drivers
Tesla plans on crashing the ride-share game next year with a fleet of empty cars.
All three companies have been driving full-speed ahead towards fully autonomous cars. It’s the holy grail of the ride-share industry.
The worst part of owning a business is having to treat your employees like actual human beings (health benefits, sick and vacation pay, 401k, maintenance on cars).
Until now, Uber and Lyft have been using the gig economy to get around paying these big expenses. But they’re coming under increasing legislative pressure around the world to recognize their drivers as their employees.
But you don’t have to treat your employees like human beings… if they’re not human beings.
Elon’s prediction that Tesla will have a fully functioning fleet of robotaxis this time next year may be a little premature. But he ain’t wrong about one thing:
This self-driving tech is going to change the world.
There’s a $15 trillion disruption in the works. And a tiny gadget available from a small company is at the heart of it all.
The Real Tide Pod Challenge: Quarterly Growth
Procter & Gamble posted its strongest quarterly growth in eight years, proving that there’s no such thing as bad publicity.
P&G is the company behind a host of household brands like Gillette, Charmin, Febreeze, and Tide (the makers of those delicious multi-colored detergent pods).
Tide took some flak from the media about a year ago when a bunch of kids went to the hospital after eating its tasty-looking, definitely poisonous tide pods. But that hasn’t stopped P&G from achieving three-quarters of solid sales gains.
Organic sales were boosted by a new price increase initiative. Starting last September, P&G has been increasing prices on a rolling basis between 4%-10% on a rolling basis. (Apparently, it takes a lot more than a price increase to make folks change their toilet paper brand.)
The company reported growth across all categories but the company’s beauty products were on fleek with organic sales rising 9%. (Okay. I’m sorry. I’ll never say “on fleek” again. I tried it and I didn’t like it.)
P&G was down almost 3% in the midday trading. But since this time last year, the company’s stock has risen almost 44%.
The Night of the Living Dems
CNN’s Monday night lineup was a non-stop marathon of town halls with five Democratic presidential candidates (zoologists refer to this as a “Bleeding Heart” of Democrats).
Nobody has the time or patience to sit through all that (and miss the American Pickers marathon on the History Channel). Here’s a breakdown of everything you missed:
Believes lawmakers have a duty to weigh in removing the president from office. (And by “weigh in” she means to just go ahead and impeach.)
Worried about being “Hillary’d.” Warren says too much of the media coverage is about what “I’m wearing, about my hair or my voice or if I smiled enough.” (I would never make fun of Warren’s appearance. Her crappy Game of Thrones analysis, on the other hand…)
Wants to enact a sweeping student loan proposal that would forgive $1.25 trillion of student debt. (I hope she realizes this would destroy the U.S. ramen market.)
Proposed to pay for the proposal with a 2 cent tax on every dollar above $50 million.
Believes all incarcerated Americans should be allowed to vote, no matter how terrible their crime.
When asked if he was worried that comment would backfire, Bernie replied, “Well, Chris. I think I have written many 30-second opposition ads throughout my life. This will be just another one.”
Is wary of even talking about impeaching Trump. Worried that it would only distract from the 2020 election’s “kitchen-table issues.” (Free breadsticks for everyone!)
Owned up to knowing jack about foreign policy during the 2016 election. Promises he’s better now and has been helping out with the whole Yemen thing.
Believes “Congress should take steps towards impeachment.”
Hedged many of her answers with her classic deflection of “let’s have that conversation.”
Came under fire for not having a section for policy on his website. Buttigieg responded that it was more important to communicate values without drowning voters in “minutiae.” (My God! He’s right. How can we possibly expect voters to make an informed decision when they have all this specific information on policies the candidates believe in?!)
Said ex-convicts should get their vote back when they leave prison. But disagreed with Sanders that those in prison should get to vote. (Because it would give Candidate Crushbone an unfair advantage in his district.)
Defended his demotion of his city’s first-ever African American police chief. But acknowledged he was “slow to understand just how much anguish underlaid the community’s response to this.”
Said Trump should be “held accountable” for his behavior. But had no opinion on what the consequences would be.
Called student loan debt forgiveness proposals from other candidates as unrealistic. “I wish I could staple a free college diploma under every one of your chairs. I do. Don’t look. It’s not there,” she said. “I wish I could do that, but I have to be straight with you and tell you the truth.” (Worst Oprah ever.)
Channeled the spirit of Jeb Bush’s infamous “please clap” moment. When she was met with silence after boasting about winning in a purple state, she told the audience “That’s when you guys are supposed to cheer, OK?”
ONE LAST THING
Seven Years Until Medicare Explodes
According to a government report released yesterday, both Medicare and Social Security are running out. (And just like toilet paper, you don’t want to be the one left holding the roll when it does.)
If things keep going the way they’re going, the government predicts that Medicare will become insolvent by 2026, just seven years from now. The clock on Social Security has a slightly longer fuse, but will likely be depleted by 2035.
Both Republicans and Democrats agree that this problem needs to be addressed to avert a dire financial crisis. But neither one of them wants to add the cost of fixing them to their list of proposed policies. (I get it. It’s not a sexy policy. They’re cowards, of course, but I get it.)
If Medicare fails, it would mean that hospitals, nursing homes, and other medical providers would be paid only part of their agreed-upon fees. While a halt to Social Security would mean automatic benefit cuts for most retirees.
I recommend you don’t sit around and wait for it to happen.
If you want to avoid getting sucked into this retirement crisis you need to take action now.
Nobody can save your retirement except you.
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Closing Data for 4/22/19
|S&P Index 500||$2,907.97||↑ 0.10%|
- Oil hits six-month highs on news the U.S. will end waivers on Iran sanctions.
- Herman Cain withdraws from Federal Reserve Board contention following sexual harassment allegations.
- New CEO of Lululemon (LULU) says there is “no need” to discount $100 yoga pants. How inflexible.
Click here to send us your comments and tell us what you think. Do you agree with us? Do you think our ideas are stupid? Bring it on. We can take it.
Last week, I asked you if you’d spring $2,000 for Samsung’s folding phone (or any phone for that matter). Father John, who is a big fan of the brand, gave us his two cents. (Or should that be 200,000 cents?)
I love my Samsung S8, and plan on getting the S10. (I historically skip a model number.) I have two Samsung tablets. Great products, great company.
However, a ‘folding phone’ is more a gimmick than a useful feature. I don’t think I would even pick up the product at the store to look it over.
It is certainly not worth another $1,400 bucks. — Fr. John E.
If you’ll allow me to paraphrase, Father: “To err is human, to forgive divine… but you’re mad if you think I’m paying $2k for a bendy phone.” Meanwhile, in yesterday’s issue, we featured a letter from an angry reader who questioned my intelligence for eating a veggie burger. Reader Nancy M. came to my defense.
I can’t help but wonder why Jim S so passionately cares what you eat. Even if you really are an idiot, what possible pain does it cause him? — Nancy M.
Thank you for that vote of confidence, Nancy.
This is America, after all. I should be free to be an idiot without harassment.
Editor, One Last Thing