Tesla s Biggest Bear

Published on
April 26th, 2017
40 minutes

Tesla s Biggest Bear

The Interview ·
Featuring Mark Spiegel

Published on: April 26th, 2017 • Duration: 40 minutes

Mark Spiegel has been bearish on Tesla since late 2013 and his conviction on the stock has made it the biggest position in the Stanphyl Capital Management short book. Mark pulls no punches as he goes beyond the hype to pick apart Tesla’s balance sheet and new model roll out plans, as competition heats up, in an illuminating short-selling portrait. Filmed on April 12, 2017, in New York.


  • TD
    Tomas D.
    6 February 2020 @ 19:49
    He is an economist that is why is he doesn't understand Tesla. I bet TSLAQ are mostly that, bean counters, who dont understand, AAPL, GOOG, FB, AMZN or bitcoin.
    • ST
      Simon T.
      10 June 2020 @ 08:57
      He is a hedge fund manager but I bet he will soon bet against Nikola - that makes perhaps more sense at this stage but clearly the market is totally overvalued now as a whole
  • ST
    Simon T.
    30 January 2020 @ 23:20
    Most people who have followed Mark Spiegel’s advise lost more than their shirts, probably lost more than a Tesla is worth, just saying
  • NP
    Nick P.
    17 July 2019 @ 11:16
    Watching 2 years later, go to hand it to Mark. He is spot on.
    • ST
      Simon T.
      30 January 2020 @ 23:18
      Don’t trust Mark Spiegel or any super arrogant short sellers
  • SW
    Seth W.
    19 July 2017 @ 00:01
    Anyone who cares about seeking the truth and making money off the stock, our long write-up on Tesla can be found here... https://www.dropbox.com/s/022q7ez3ojjjxa1/AtlasPrincipals_DomesticLPQ1_2017.pdf?dl=0
    • EN
      Eric N.
      21 January 2019 @ 21:38
      "We have never performed a greater amount of due diligence on a company...". The report is certainly not shy on due diligence on what Musk might or might not be thinking. Since we are posting links, here's a nice Youtube video on a short thesis: https://www.youtube.com/watch?v=ZMbhzeBACVk.
  • BC
    Ben C.
    28 April 2017 @ 06:32
    PS - I'm truly suffering from the cognitive dissonance that comes with my new hero of finance (Raoul) so vocally criticizing my top hero of industry (Elon) recently. It makes for some good soul searching, and I deeply appreciate RealVision for pushing my comfort zone :) I would pay good money to have a conversation with Raoul to help rectify my views with his!
    • MS
      Matt S.
      28 April 2017 @ 18:13
      Raoul wasn't in that interview dude?
    • BC
      Ben C.
      30 April 2017 @ 02:20
      That's true ... but he replied with a comment to this interview, and has been vocally anti-TSLA on Twitter and multiple podcasts in the last few weeks. I have complete respect for his views, but I wonder if he may be misjudging Elon's mission and the benefits of the "guerilla style" marketing that has worked so well to navigate the bureaucracy and crony capitalism entrenched with car manufacturers, dealers, and big oil ... or could he make a good argument that I'm the one making the misjudgment??
    • CS
      Christopher S.
      1 August 2018 @ 12:08
      Pay enough and I'm sure you can!
  • JB
    Jim B.
    10 April 2018 @ 22:15
    Green-Tards! I love it
  • SH
    Shah H.
    21 July 2017 @ 01:36
    I was hoping he would talk about what models is he using to determine the stock price. Without more facts and figure, It is just a talk.
  • TM
    Todd M.
    26 April 2017 @ 13:54
    A rambling bunch of thoughts with little depth.
    • DF
      Dave F. | Contributor
      23 June 2017 @ 04:04
      Not sure you listened too well. Very specific talking points laid out....great insights.
  • DF
    Dave F. | Contributor
    23 June 2017 @ 03:49
    Fantastic insights.....nice interview Tommy
  • SA
    Sandeep A.
    10 June 2017 @ 01:47
    The guy clearly doesn't understand why technology stocks like Tesla are valued so highly. He would have said the same things about Amazon two decades back.
  • NH
    Nigel H.
    24 May 2017 @ 22:39
    Haha greentards
  • SC
    Steve C.
    2 May 2017 @ 09:24
    I think one needs to be extremely careful about shorting tesla. There was nothing fundamental in this presentation that challenged from a deep understanding the model of tesla. We have all seen similar pessimistic views in the early days of Apple. Etc. Imagine shorting that stock in the early days. This is a market with a seriously large disruptive opertunity. Despite almost anything tesla could do wrong there are enough people around the world to suck this entity into being. The fundamental premis of the argument in this presentation was that it would be impossible to produce the model3 at the sale price based on the model s pricing. I am a designer of products and as a designer I know full well how the economies of scale, design experience, elegance, etc change by orders of magnitude as you iterate through various designs. Telsa will have to produce m3 for under 20k to be viable and is that possible? Of course it is. In that sclale there could be demand for 6 million m3 per year and it will be a long time before tesla build a car that's not already pre sold. Maybe a decade! Just remember one thing this is a company that has not had to spend any money on marketing whatsoever.
  • DS
    Dustin S.
    2 May 2017 @ 09:10
    Really enjoyed the TSLA portion. I learned a number things that I didn't know about the upcoming EV competition. Unfortunately, they ended with a rambling discussion of European fixed income that came across as junior varsity at best.
  • GS
    Gordon S.
    26 April 2017 @ 23:26
    As Mark correctly pointed out, there is huge trust in Elon Musk. I would point out that he has some deep pocketed friends too. Larry Page for instance (http://www.businessinsider.com/larry-page-elon-musk-2014-3?IR=T). I could see a substantial pull back, but definitely not zero. Tesla would be taken over in the blink of an eye at lower valuations. I personally don't like his reckless risk taking (which almost bankrupted him a few times already) and the way he does it (balance sheet tricks & handling his clients like beta testers), but this guy deserves nevertheless some credit. It’s not like he has done this for the first time. He has revolutionized payment, space and electric cars, I think his vision is far greater than profitability in the next two years. Of course the question is legitimate whether or not he will be funneled enough money to last long enough, and here Mark surely has a point. Maybe I’m one of these “green-tards”, but I hope he does succeed (even though I do not own any Tesla shares). But if he does you have an option on solar - maybe the energy of the future, electric vehicles - probably transportation of the future and on top of that very probably autonomous driving (as pointed out in another comment, those collected data series are worth a lot, his autopilot is another cheap way to beta test…). Is that option worth 50 billion? I don’t know, but definitely not zero. I also want to point out that Mark stated he usually does not invest in technology. This would caution my view on his conclusions a bit. Nevertheless great interview and I will watch this play out with great interest. Please have him back and I would also love to see him debate with a fanatic Tesla long? I was disappointed that Mark did not talk about the battery issue he insinuated? I was also disappointed about him not talking about Tesla latest solar & battery project. From my understanding his roof tiles could be another product that literally goes through the roof? I think it’s also dangerous to see Tesla as only a car company, it’s not.
    • GS
      Gordon S.
      1 May 2017 @ 19:39
      Btw, TED has just released a 40min long interview with Musk (RV style) : ( https://www.ted.com/talks/elon_musk_the_future_we_re_building_and_boring ) and to evaluate his current track record here is the one from four years ago ( https://www.ted.com/talks/elon_musk_the_mind_behind_tesla_spacex_solarcity ). Pretty impressive to me.
  • KS
    Kolby S.
    30 April 2017 @ 06:55
    What I liked: It's very apparent that Mark is a bright guy with a really unique background. I thought his interview style was great - no bullshit or political correctness, he just tells it the way it is. Would love to grab a beer with the guy. I also thought he hit the nail on the head with his sovereign debt trade at the end. Can't wait to hear more about that thesis. What I didn't like: "Elon Musk is a big phony"... Well, the guy built a 20 ton rocket that can hover land itself back on planet Earth. He has also revolutionized three different industries. Maybe phony isn't the right word. Also, comparing Tesla to Enron might be a bit of a stretch. What concerned me: He started selling a $310 stock at $90. Would make a great behavioral finance case study.
  • RR
    Raj R.
    29 April 2017 @ 19:45
    Electric cars will be viable as soon as 2020. Battery technology is getting better. Once electric cars start costing the same as gasoline cars Tesla will see a lot of competition. Tesla is a great ide
  • NS
    Niek S.
    29 April 2017 @ 17:26
    Always really nice to someone that just hates bulls**t. Great thesis and great interview.
  • MH
    Marco H.
    29 April 2017 @ 09:44
    Very entertaining interview. I agree to the businesscase of Tesla compared to the stock value but to me technologically it is a very interesting company. I have driven the car and it feels great. The battery technology is advanced in terms of management and charge technology (fi: compare the lifetime of your cellphone battery vs this car) and to me Elon is innovative. But its sharevalue is like the coyote running of a cliff. One day it will find out there is no support and it will drop. However: the trend at this moment is up and once the trend will turn there will be lots of opportunity to go short. To me that time has not come. Not yet.
  • DH
    Derek H.
    29 April 2017 @ 03:02
    This guy just knocked it out of the park . One of my new heroes in money management.
  • MS
    Matt S.
    28 April 2017 @ 17:55
    Fucking hell, smart guy, how does he know so much?! Anyway... yeah! Have him back on, easy to listen to.. good interviewer too.
  • DM
    Daniel M.
    26 April 2017 @ 16:02
    Gents, Elon single handedly revived the space industry. What he has done for rocketry is revolutionary. +1 In Tesla he has changed the business model for car makers. He has scrapped the dealer network and has integrated everything so that there buying a car is a pleasure. Because of this integration he owns what the VC guys call the 'full stack'. He has service vehicles that come to you to do the maintenance. He's made electric cars that actually look good, not the weird looking things like the Volt or stupidly futuristic looking ones that are coming out. He took deposits for 400K cars - who else has done that? +1 But most importantly, from a branding perspective, he was first in category. He owns the words 'electric car' in the minds of people. Similar to how Volvo owns the word 'safety'. He's an incredible storyteller that has captured the minds of the early adopters - the people that will pay high prices and accept inferior products just because they believe in the future that he's trying to bring. +1 Owning the word in people's minds and having the early adopters behind you is incredibly valuable, and that is the thing that the bears are missing.
    • S
      Sigurður .
      26 April 2017 @ 17:07
      Did you watch and listen to the interview? Don't think that anyone is disputing Musk's talents. The issue is a complete different one.
    • DM
      Daniel M.
      26 April 2017 @ 17:35
      Yes the company is unprofitable. But it is growing revenues exponentially. So keep at it and once you dominate the category and maintain your monopoly, then you can worry about profitability. In the meantime, he is the undisputed leader in the electric cars category and will likely continue to do so based on the work by Al Ries who is in the Marketing Hall of Fame. Check out 22 Immutable Laws of Marketing and you'll get what I'm talking about. The best product doesn't always win in the marketplace. The leader of the category and those who own key words in the mind of the customers usually do. If you ask people who invented the smartphone they would all say apple. But apple did not. In blind taste tests between pepsi and coke, everyone picks pepsi, but coke is the category leader. Why? Because they were first.
    • IF
      Ian F.
      26 April 2017 @ 17:47
      Did you not watch the piece? This short has nothing to do with the (very good) product.
    • AM
      Alonso M.
      26 April 2017 @ 17:49
      Meh. Probably most of the "investors" in this stock will bolt in a bear market regardless of their opinion about what Musk has done for rocketry. Companies with gross margin issues and debt get absolutely slaughtered in bear markets. I think the chart pattern tends to move this thing more than anything else, and the P&F charts I'm looking at say this pig will fly all of the way up to $475-$525 per share before the jig is up. I like this guy's other short idea which seems to be more catalyst rich at the present time. Excellent interview.
    • DM
      Daniel M.
      26 April 2017 @ 18:11
      Yes I watched the interview - they think Tesla is overvalued. My point was simply that whoever was first into the mind of the customer in the category usually wins in long run. Tesla was the first into the mind of the customer in the electric vehicle category.
    • KS
      Kashyap S.
      28 April 2017 @ 11:32
      For all those claiming first mover advantage, you need to read the book "Fast Second: How Smart Companies Bypass Radical Innovation to Enter and Dominate New Markets". They have ripped that notion apart.
  • GM
    Gavin M.
    28 April 2017 @ 06:55
    Great interview Tommy. As much as he may be right on Tesla, the extreme reflexivity of the market now and the political connectedness of Elon to the White House makes this a dangerous short imho. Fascinating interview though so please have him back guys.
  • BC
    Ben C.
    28 April 2017 @ 06:13
    I started buying TSLA at $27 and have been bullish on the company ever since. I agree that the price will very likely crash when the market as a whole finally turns south, so I have been pairing back my position. I appreciate the interview and love to hear the bear case. With that said, I'm disappointed he felt the need to resort to so many shameless straw man arguments. He made a lot of fair criticisms of the company, but very poorly represented the arguments for the company to succeed. It's absurd to claim that "the whole bull case is that Elon is a genius and therefore we're investing in Elon." Lots of investors recognize there are lots of good reasons for the company to thrive now even without Elon. He states "You've got videos of these cars crashing all over the place under what he calls autopilot." While the internet most certainly does have "videos" of crashes, autopilot is proving to be far safer than human drivers under any fair analysis of the data. "Global warming fanatics are willing to overlook anything". True, but those people make up a tiny fraction of stock holders, and aren't moving the price significantly - they're not relevant in this conversation. "For a guy who says he's saving the world, he's a big phony." I understand that perspective from someone who superficially pays attention to Musk and Tesla. But from someone who deeply studies the company, that sounds like a statement coming from either deep bias or a deep misunderstanding of what drives people like Elon Musk (genuinely wanting to make a better future, for one thing). I have the sense that Mark's 1 year working inside a microcap stock company gives him too much confidence that he understands industry really well. I believe the big companies he mentioned will have a much harder time adjusting to the EV revolution than he realizes. His views seem to be based in the automotive industry of the 20th century, while we're now living in a tech-oriented 21st century that is still hard to understand and value. YES, the price is probably too high now, but disruptive innovation is messy and complicated and extremely difficult to price, and there are a lot of good reasons that the company can be thriving (with a much higher stock price) in five years. His argument would be much stronger if he could make it without mocking or ignoring the many good reasons for long-term optimism.
  • ES
    Edward S.
    28 April 2017 @ 02:09
    It's so irritating that Musk named the company Tesla when he wants to build a DC power grid... among many many other things. Nikola Tesla was an engineer, not a salesman. Musk is the mirror image of Nikola Tesla.
  • TC
    Terry C.
    27 April 2017 @ 22:34
    Typical short seller's hubris... and a lot of points are confirmation bias. This is the type of guys who short amazon and says they don't make a dime and worth zero. The result is they get squeezed really badly and still don't admit they make a mistake. The market might be wrong in terms of a stock's long-term value but going against it with no humility is not a great idea either.
  • RP
    Raoul P. | Founder
    27 April 2017 @ 17:30
    Great interview. Love to see people who know their shit. Very impressive and a great job by Tommy.
  • NR
    Nuno R.
    27 April 2017 @ 16:38
    His thesis has merit, but I'm curious to know how much $$ Mark has lost already shorting TESLA. This is a cult stock, you need big b**s (or deep pockets) to be on the short side, as the long narrative can drag forever...
  • bf
    bart f.
    27 April 2017 @ 15:18
    it takes big balls to short tesla and openly speak about it, i have a lot of sympathy for the rational but the main reason it might not work is that it is a direct bet against the common narrative.
  • SR
    Steve R.
    27 April 2017 @ 00:19
    Tesla is already a hugely shorted stock - which means there could be a massive short squeeze at any time. Would probably need to use Options to minimise this risk?
    • SD
      Stephen D. | Contributor
      27 April 2017 @ 01:08
      Steve R is right. there are 31.5m shares already short on TSLA with 164m issued. Take out Musk owning 33.6m and that's 130m so a 25% short of outstanding trading stock is a lot. On the other hand the stock trades huge volumes, 5-10m shares a day; and 3-6 days short volume is not a lot.
    • AH
      Adam H.
      27 April 2017 @ 09:03
      which strategy on the options do you recommend?
  • AH
    Adam H.
    27 April 2017 @ 08:59
    best interviewee ever!
  • kv
    keith v.
    27 April 2017 @ 08:50
    This was a great guy with a great mindset.
  • SD
    Stephen D. | Contributor
    27 April 2017 @ 02:25
    Ok, Mark makes a really good case for being short Tesla. It's got a $51bn mkt cap and is losing money hand over fist. In 2012 the stock was trading at $30, now it's $310 and Mark says it's worth $0. But shorting this thing is very dangerous- it's up $100 this year. One way to approach stocks with terrible fundamentals but strong momentum is try not to be a hero and wait for the momentum to turn negative. Moving Averages (MA) are useful. Wait for the 5 day MA to cross below the 20 day MA before shorting and only get aggrerssive when the 50 day MA crooses below the 200 day. Sure you aren't the guy who sold the top but you stay alive.
  • BG
    Bruno G.
    27 April 2017 @ 01:57
    10 down votes? Must be the 10 people with Musk crushes who drive his cars.
  • RM
    Russell M.
    27 April 2017 @ 01:54
    Enjoyable plain talk style. Nothing wrong with a few F - bombs where deserved.
  • MV
    Michael V.
    27 April 2017 @ 01:36
    This is great. I was really looking forward to this one and it lived up.
  • WK
    William K.
    26 April 2017 @ 23:39
    Hasn't found anything to buy in six months.....telling.
  • JT
    Jan T.
    26 April 2017 @ 21:02
    Interesting stuff as always, but good luck to him and all others in shorting tesla. Make sure you got enough collateral at hand -:) Personally I hear what he says but would prefer to short any stock except Tesla. Momentum and vibe around Tesla is way too strong. And I bet he will continue to get all support from Trump as this fits nicely in with the American dream, jobs in US etc.. Also his comments that Elon is boosting his numbers to get a bonus is a bit laughable imo. The guy his lifestyle does not depend on a bonus from Tesla....
    • JT
      Jan T.
      26 April 2017 @ 21:06
      And my trading tip for the Tesla haters... instead of outright short. Buy yourself some cheap OTM puts while the stock moves up. This way you max loss is capped
    • GS
      Gordon S.
      26 April 2017 @ 22:55
      I was wondering about that, that is probably what Mark is doing right? Everything else is nuts!
  • MN
    Mark N.
    26 April 2017 @ 20:03
    Fun interview. I wish Mark would go more in depth as to how to carry such a short for prolonged periods of time. The Hedge Fund Telemetry guy seemed a bit nervous early on but finished it off well and definitely seems like very sincere interviewer, I hope he gets asked more often.
    • TT
      Thomas T.
      26 April 2017 @ 22:30
      To be honest, I am new at interviewing in front of cameras so once I got going it was fine. I really enjoyed it and hope to be interviewed to discuss my background and process to the markets.
  • SB
    Sam B.
    26 April 2017 @ 21:18
    Really entertaining interview... having other similarly vocal short sellers on RV to present their cases would be great. Or do a "Firing Line" style long vs short debate series.
  • JT
    Jan T.
    26 April 2017 @ 21:04
  • GA
    Giedrius A.
    26 April 2017 @ 20:21
    Great straight forward interview. Thank you RV.
  • JM
    Jim M.
    26 April 2017 @ 15:06
    Top notch, very enjoyable. Anybody that uses "green tards" to describe these global warming alarmists is OK with me.
    • MH
      Mark H.
      26 April 2017 @ 20:20
      I really wish Trump et. al. would do some serious due diligence on wind turbines. I do not get the logic of subsidizing them endlessly. Everything with specific facts I read is 99% bad. Minnesota is going crazy with this stuff.
  • GF
    George F.
    26 April 2017 @ 20:04
    One thing I noticed is the commentators are male. Women absolutely hate pumping gas, and most places in the US are self service these days. Women also hate dealers and the service department, which Tesla does not have. Electrics make a lot of sense in cities, where the people who can afford Tesla live. In my male opnion when it comes to women the competition is between electrics and Uber. I don't know if Tesla can get the costs down enough to sell the cars for $40000. But internal combustion cars can be sold with dealer markup for less than $20,000. In theory Tesla's Giga factory will produce batteries at a cost that makes $40000 possible. My understanding is all auto makers sell their cheaper models for no profit. Probably Tesla will make no money on the cheaper cars, but because of cheaper batteries will make more profit on the high end. One reason internal combustion engines need extensive testing is they have to get oil circulation and air filtering exactly right all the time. Electrics can rely on models much more than IC cars. Also unmentioned is the real world data Tesla collects from its 'autopilot'. That data makes Tesla a possible first mover in self driving cars.
  • PM
    Patrick M.
    26 April 2017 @ 15:54
    two minutes in and I want to put some money with this guy
    • TM
      Todd M.
      26 April 2017 @ 18:39
      Wonder how big his fund is ...hmmmm...Google...
  • RD
    Ryan D.
    26 April 2017 @ 18:31
    This guy rocks!
  • JO
    Joseph O.
    26 April 2017 @ 18:20
    Informative and bold ideas delivered simply and clearly... and with hindsight, aren't most of those that we come to see as insightful/prescient? Great interviewee- very genuine. However, it would be great to hear a contrasting bull case... could this be another segment on RV? A debate-style interview? Obviously to be conducted in the respectful RV tradition.
  • AH
    Andreas H.
    26 April 2017 @ 18:06
    ssssssuuuuuuuupppppper, a micro caps manager, Love it, I have use the same strategy!!! Love it!
  • AK
    Anthony K.
    26 April 2017 @ 15:12
    Great piece! But even if I somehow thought it wasn't.. I would have to give it a thumbs up for the Jim Jones reference of having knock Off Kool-Aid. Ha!
  • EH
    Eric H.
    26 April 2017 @ 14:24
    this guys legit!
  • RM
    Richard M.
    26 April 2017 @ 14:20
    Very interesting, enjoyable, and entertaining! Great stuff!
  • LJ
    Lucille J.
    26 April 2017 @ 13:57
    Great interview-- This dude is just him self
  • JM
    James M.
    26 April 2017 @ 13:49
    I am a very cautious Tesla bear and so I am always watching for reasons my thesis may be wrong. I was disappointed that Mark did not comment on Tencent's recent investment and the Chinese market. Otherwise I appreciated the interview. Thanks Real Vision.
  • js
    jacob s.
    26 April 2017 @ 11:15
    solid stuff. funny guy. hope to hear more ideas in the future.
    • KB
      Kreso B.
      26 April 2017 @ 12:22
      Funny how? Is it the way he talks? Does he amuse you? Funny how? How the **** is he funny? Tell us.
    • MV
      Michael V.
      26 April 2017 @ 13:36
      For those thumbs downing Kreso, I believe he's making a joke here.. paraphrasing Pesci in Goodfellas if I'm not mistaken.
  • SS
    Sam S.
    26 April 2017 @ 13:28
    Very Well Done.
  • VV
    Vanessa V.
    26 April 2017 @ 12:33
    Really enjoyable and informative video. I had a few good laughs. Admired Mark's indepth research to back his view on Tesla. And it was great to 'meet' the man behind the amazing Hedge Fund Telemetry website. Good job guys. Thank you.
  • JS
    John S.
    26 April 2017 @ 11:05
    Good entertaining interview