Tesla Facts of the Day

Dana Hull and Hannah Recht write a critical review of Tesla's cash burn rate and potential liquidity challenges in their recent Bloomberg article.  While I greatly admire Elon Musk as an inventor and innovator, I am also flummoxed by his apparent deficits as an operator as Tesla continues to miss its production targets. However, my interest in the article has nothing to do with whether or not I think Tesla is viable as a long term company. I have included my favorite facts below. Please share yours or links to other articles in the comments section.

  1. The current cash burn rate is $6500/minute. It took me $52,000 to read the article.
  2. Tesla has approximately $875 million dollars in deposits for future cars and prepayment for features that Tesla has not successfully developed yet.
  3. Telsa has received $1.3B or $3,500/car sold from selling Zero Emissions credits.
  4. The company currently has 40,000 employees and majority of its manufacturing process is currently being done by hand and not through automation.

Disclosure: I probably own shares of Tesla as part of Broad US market index funds held in both my brokerage and retirement accounts.

My Perspective on the Facebook and Cambridge Analytica Story

Since the New York Times/London Observer story regarding the Trump campaign's use of Cambridge Analytica tools to target potential voters broke on March 17th, we have been inundated with news reports, articles, and blog posts about how a Facebook "Data Breach" helped Trump with the 2016 U.S. Presidential election. This story seems to piggyback the recent stories about Russia using Facebook to help Trump win the 2016 election.  My first thoughts were if Facebook can be so easily manipulated to sway elections, why couldn't the Bernie Sanders or Hillary Clinton campaigns, with their more technologically engaged base,  take advantage of the platform. With the amount of media coverage, and no actual data breach, I figured there must be more to the story.

As I read further into the story, it appears that the Trump campaign engaged Cambridge Analytica to help target potential voters with ads on Facebook. Aggregating user data and selling it to advertisers is a regular business practice for Facebook.  In fact, using my google browser and typing the search terms "does Facebook sell your data" I can find many articles dating as far back as 2014 that acknowledge the practice. Also, Facebook is not the only company that sells user data.  Major news networks like CBS, Newsweek and ProPublica have been publishing articles about harvesting user data since 2012.  My internal cynic thinks that most of the media coverage and outrage either has to do with the fact that political campaigns are using big data to get votes or that unpopular President Trump benefited from this round.  Contrary to the recent sentiment, consumers often benefit from sharing data with advertisers. We seem to appreciate our data being analyzed when Amazon recommends a book based on previous purchases and when Netflix suggests what TV shows we may enjoy.  

While Cambridge Analytica did not hack into Facebook to obtain user data, their actions were deceptive. Cambridge Analytica was able to obtain data from an individual who went through the appropriate Facebook channels to access the data. While Facebook did not directly give Cambridge Analytica access, it does not seem that Facebook made much of an effort to prevent Cambridge Analytica from using it. Furthermore, Facebook's request to have Cambridge Analytica cease using data and delete it in 2015 shows that Facebook had been aware of how the data was being used and did not take action until the NYT article was about to be released.

My Takeaways

  1. Cambridge Analytica used deceptive tactics to obtain Facebook user data and lied  about their intended use of the data. 
  2. Facebook probably failed to live up to its obligation to protect user data . (I confess that I have not read though Facebook user agreement)
  3. I need to be more consciousness about what apps I allow to view my data.

Interesting Articles on the topic

  1. Cass Sunstein's op-ed implores us not overreact to this news story.
  2. Tyler Cowen's article  discusses how this story fits the larger narrative that "tech fears" are driven by the fear of loss of control.
  3. Leonid Bershidsky's op-ed argues that Facebook's business practices, and not Cambridge Analytica, are the bigger issue.
  4. The Daily Podcast episode walks through psychographic messaging and the mechanics  Cambridge Analytica used to acquire Facebook user data. (for sensationalized, partisan fueled hot takes, take a look at the "Background Reading" below the podcast episode)
  5. Josh Constine's article highlights the impact of Facebook Ad spending during the 2016 Presidential election

As per Metcalfe's Law, the value of networks grow as the size of the networks increases.  The impact of social media will continue to grow as more people become connected. The combination of larger networks and more powerful analytical tools, will enable advertisers to better target their potential users.  When used for good, it will facilitate cooperation to solve problems that stumped previous generations. However, it also enables bad actors to target susceptible victims.  It will be interesting to see how users protect themselves without completely disengaging from social networks.

Please use comments to share other thoughtful analysis of the story or ideas of how we can protect ourselves from being manipulated from similar events in the future.