Ed’s Daily Notes for August 20th   Leave a comment

Bloomberg: Tesla Says Model S Electric Sedan Receives Top U.S. Crash Rating

Tesla Motors Inc. (TSLA), the electric-car maker led by billionaire Elon Musk, said its flagship Model S sedan received the highest crash test ratings of any car tested by U.S. regulators.

The battery-powered vehicle, with a base price of about $70,000, got five-star ratings in every safety and crash category set by the National Highway Traffic Safety Administration, the Palo Alto, California-based company said in a statement. The car has the “lowest likelihood of injury to occupants” and exceeds the performance of sport-utility vehicles and minivans, Tesla said late yesterday.

The reason for those results?

The Model S lacks a large engine block and has a larger “crumple zone” to protect passengers in the event of a crash, the company said. That helped the car get a combined 5.4-star score in government tests.

I love the company, but so does Wall Street. Tesla is still hugely overpriced, with a forward PE of 85 and a PEG ratio of 13. For comparison purposes, Tesla has a $17 billion market cap, whereas Ford has a $63 billion market cap and GM has a $47 billion market cap. Based on the current price, Tesla is expected to increase it’s production to Ford and GM levels in 5 years. I just don’t see how that is possible. I have a great amount of respect for Tesla CEO Elon Musk, but that is asking for a miracle from him.

Washington Times: Rural Coloradans to vote on breaking away as 51st state, angered by liberal policies on guns, energy

Voters in several rural Colorado counties will be asked whether they want to form a new state tentatively named Northern Colorado in the November election, a reaction to the Democrat-controlled state legislature’s “war on rural Colorado.”

The Weld County Commissioners voted unanimously at Monday’s meeting to place a measure on the Nov. 5 ballot asking voters whether they want the county to join other rural counties in forming another state.

“The concerns of rural Coloradans have been ignored for years,” William Garcia, chairman of the Weld County Commissioners, said in a statement. “The last session was the straw that broke the camel’s back for many people. They want change. They want to be heard.”

Three other rural counties — Cheyenne, Sedgwick and Yuma — also plan to place the 51st state referendum on the fall ballot. At least three more counties plan to consider the proposal this week at their commission meetings, said Jeffrey Hare, spokesman for the 51st State Initiative.

Known for its agriculture and oil and gas production, Weld is the largest of the Colorado counties exploring a break with the state after the legislature’s sharp turn to the left with bills restricting access to firearms and doubling the state’s renewable-energy mandate for rural areas.

Democrats control both houses of the legislature and the governor’s office. Two Democratic state senators — Angela Giron and John Morse — are facing Sept. 10 recall elections in response to the legislature’s gun control votes.

Forming a state isn’t easy: Even if the ballot measures pass, the Colorado state legislature would be required to amend the constitution to configure the state’s borders and refer a request for a new state to Congress.

Approving a 51st state would require a majority vote of both houses of Congress, although the Constitution doesn’t require the signature of the president, Mr. Hare said.

While I doubt this will reach Congress, it is indicative of the growing political divide in this country.

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Posted August 20, 2013 by edmcgon in News, Politics, Stocks

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