Threw some more cash onto one of my favorite positions for $14.23. People hate this stock for no reason. Meanwhile, it’s pumping out cash left and right.

Multifamily is the only real estate worth owning.

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My distaste of TSLA was built on a few different arguments. The main ones were basically: (1) overpriced valuation, (2) no sales data and (3) issues with how they were managing their leases.

(1) is still quite valid and I maintain my bearish posture on TSLA because of it.

Issues (2) and (3) however are getting the data and attention needed to back them up, if indirectly.

The leases were pushed off into a separate segment of the filing in the latest quarterly settlement. Whether this was of Musk’s own free will, pressure from outside sources, or some combination of the two is rather irrelevant – this needed to happen and it has. I’m still watching it closely, as an active stake against the stock, as it lost $0.15 for every share. But this early on could be prudent early write downs to get fair books as much as anything else.

And as for the sales data; we still don’t have any of that. This is an obnoxious inconvenience, and should be pretty straightforward.

However, CNBC commissioned Edmunds.com to to analyze registrations and online search data to get a feel for who is buying Tesla’s cars. 77% of the buyers, according to this estimate, have salaries over $100,000. 17% more have salaries over $50,000. If these estimates are accurate, then there is no concern about Tesla’s sales or leases, clearly. However, sales data really needs to start getting reported better, directly from corporate. If the company is a $17 Billion market cap, it needs to hold itself to it.

So what does this change? Not a whole lot, to be honest. I’ve never encouraged short selling TSLA – it’s too risky. My position is tiny, built of options, with a chance to add 5-10% to my account value if sometime over the next 2 years, the unexpected should occur. The omitted sales numbers and leases getting integrated with earnings (even though they’re long term payouts) were simply red flags. Now that they’re getting addressed, this play morphs into a foremost bet off the valuation and probability. The growth curve the company requires, if subject to any notable delays or missed expectations, will yield fruit to me.

However, these signs are good for Musk and the hardworking men and women at Tesla, who are being vindicated for their efforts.

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I purchased HCLP for $23.99. This is pricier than I’m usually willing to pay, but it’s still a small parternship, growing very fast and right where I want to be situated. The dividend is high at >8%, but it’s sustainability is questionable.

The partnership is acquiring property rights for the sands used in fracking.

I’ll do a full write up later – I don’t have time right now.

Current positions: AEC, CLP, CCJ, BAS, EUO, DRI, RMCF, NRP, HCLP, silver, TSLA puts and cash

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There is a reason why I put (at the time) 2-3% of my account into TSLA puts, when I wanted to bet against the stock, rather than trying to short it. Shorting a cult favorite is absolute madness. TSLA can run as high as you can imagine – give them a $30 billion market cap, with one factory sitting half empty – why the hell not?

Sure it makes no sense, but as a short seller, you will not survive the process.

Now, I am reserving the right to judge Tesla’s earnings for when they actually file. I want to look through the books, read the notes, and compare some things. But, I do have an early concern.

First, Tesla did not have surprise earnings this quarter. They lost money. What they claim is that they made money from operations (unlike the opposite last quarter where they lost money from operations but came ahead selling pollution credits). But it’s funny how sometimes little word games we play can sugar coat what amounts to pure semantics.

Tesla’s “operation profit” is based after factoring out “leasing” and other items; that’s pretty vague and since I was already concerned about Tesla’s leasing practice anyway, it doesn’t reassure me, especially at these prices for the stock.

How is leasing not a part of operations?

The second red flag here is the owners who are allegedly purchasing these vehicles.

Aditya Satghare – Lazard Capital Markets
Got it. Okay. The second question was on the U.S. Market so, could you give us a little bit more color about your buyer base here and you know what kind of potential brands do you think your customers are swapping out and who do you think you are grabbing share from?

Elon Musk – Chairman of the Board, Chief Executive Officer, Product Architect
We hit some pretty good numbers for that. It’s a really broad mix of cars. It’s not and not just a premium sedan. In fact, I think we

Deepak Ahuja – Chief Financial Officer
I believe we used off that in our last earnings call that we shared

Aditya Satghare – Lazard Capital Markets
..it’s a the capital raise

Deepak Ahuja – Chief Financial Officer
Probably that’s right.

Deepak Ahuja – Chief Financial Officer
If you go back and look at our capital raise presentation,

Elon Musk – Chairman of the Board, Chief Executive Officer, Product Architect
And we haven’t go ahead and just talk about some of the cars we are replacing. Yes. It’s a wide range of cars. It’s not like you can say or it’s been probably five or something like that or it’s quite short right now, it’s like. (Inaudible).

Deepak Ahuja – Chief Financial Officer
This is from the ALG overview taking data from that bulk and they are showing sort of its various events and hybrids, so are the big ones. But it’s interesting like we have got the largest one here is sort of in the order of 10% and 11%. A lot of people are buying our car instead of the Prius, but that’s 10%. Obviously things like the E-Class are buying our cars there is a lead which also coming from so, it’s like E-Class, Prius, lead the Highlander, BMW 5 Series, Odyssey Honda Odyssey it’s like it’s 4% in the Honda Odyssey very like Model S (Inaudible) is 4%. Volkswagen Jetta is 4%.

Aditya Satghare – Lazard Capital Markets
Interesting.

Elon Musk – Chairman of the Board, Chief Executive Officer, Product Architect
Mix of Honda Civic is 3%, so it’s really a pretty broad range just from previous segment.

Aditya Satghare – Lazard Capital Markets
Got it. Now that’s helpful and congratulations on the good execution this quarter.

Alright, the BMW-style high performance vehicles excluded, most of the cars being listed here are significantly cheaper than a Model S. The range of these electric/hybrids is $25,000-$40,000. So you have people trading up $30,000-$50,000.

Okay, so how many highly affluent Prius owners do you think are out there? I did a quick push and found some statistics that actually quite a few millionaires do buy cheaper cars – that sort of thrift sort of plays to having millions of dollars in the first place. So I guess if Tesla sales are being driven by millionaire Prius drivers who just desperately wanted a high performance electric vehicle, then that’s great.

But if you question the depth of the pool of Prius-driving-millionaires-wanting-to-spend-$70,000-on-an-electric-car, then you’re left wondering if Tesla doesn’t have a pricing/contract problem that’s letting people climb into one of their vehicles who should never be climbing into one.

Because at $70,000 on the low end, any pricing problem is ultimately going to be a Tesla liability.

I have no evidence of this, but it doesn’t smell right, and I’m betting there’s a problem with the way Tesla’s leases have been set up, from the get go. Those parts of the last earnings release and filing felt wrong before. And since they drove the company into a loss this quarter, they still feel wrong now.

It might not matter at all, but any lurking issues, at – now – $150 a pop could easily derail this company.

Again (I’m sure you little pricks, getting ready to spam my comment section aren’t going to take any stock in this), I don’t have a problem with Musk or the Model S. But paying this much for the shares is madness.

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An old play, NRP, is back in my books today for $19.71. I added this at 5% of assets, keeping it small.

The play is on coal prices. Natural gas prices have increased and are no longer rock bottom. And, life in America has not changed that much. Obama and his EPA army of extremists notwithstanding, coal consumption is set to increase in America this year. And attempts to mess with that will cost everyone dearly.

I’m not going with a full position because I understand how much this administration hates coal. But, I don’t really think there’s anything they can do about it.

NRP is an LMLP and pays out a very large dividend while I wait. They’ve had problems, naturally, from competition with natural gas. However, they’ve been moving steadily to diversify their royalty revenues, and I think coal will surprise to the upside, as it becomes clear the industry is still essential to American interests.

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I will make this brief. I have now finished both AEC’s and CLP’s earnings transcripts, and have found a causal link between the two REITs and outrageous comments taunting company management, making my blood boil.

Effective immediately, one Michael Bilerman is on the radar as a possible enemy of the state of the 9th floor.

Keep an eye out for this man, as his input into both conference calls was – shall we say – reprehensible.

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