Wednesday, September 3, 2014

Last Call For A Broadside With All Batteries

CNBC is reporting that Tesla Motors's fabled electric car battery "gigafactory" will become a reality in the state of Nevada.

Tesla has finally decided that it will build its battery "gigafactory" in Nevada, sources say.

"That's a go, but they are still negotiating the specifics of the contract," a source within the Nevada's governor's office told CNBC Wednesday afternoon. The source noted that it could be a week before the deal is official.

Nevada is planning a press conference Thursday in Carson City, according to a Dow Jones report.

The Reno area has long been the front runner for the site. As always, the devil is in the details.  So what is Tesla getting for what could be the most important auto manufacturing plant since  the heyday of Detroit Motor City?  Arizona lawmakers recently coughed up $400 million in taxpayer dollars to get the $5 billion plant.  Senate majority leader Harry Reid recently tried to poo-poo the deal as a negotiating tactic.  But it looks like Nevada had what Tesla was looking for: a whole bunch of land relatively close to its California HQ and low taxes.

• Few taxes: No personal income tax, franchise tax, estate tax, inheritance or gift tax, and no taxes on corporate shares. No corporate income tax, although voters will decide in November whether to implement one to finance education — a move U.S. Sen. Dean Heller, R-Nev., said could undermine efforts to attract Tesla 
• Other tax credits or breaks: Up to a 50 percent abatement on personal property taxes for up to 10 years; a partial abatement on sales and use taxes on capital equipment purchases; and a deferral of sales and use taxes on capital equipment. 
• Worker training subsidies: Up to $1,000 per employee for job training if the company provides a 25 percent match, makes a five-year business commitment and pays at least hourly minimum wages. 
• Other advantages: Proximity to the assembly plant in Fremont, California, where Tesla makes its cars; significant deposit of lithium, which is essential to making the batteries.

And all indications are this is a done deal as Nevada has it in the bag.  However, one has to wonder just how good Tesla workers will have it:  Nevada is a right-to-work state.  Will Tesla's 6,500 employees unionize? It's great that one of the hardest-hit states from the Great Recession (Nevada's unemployment was 13.9% this time four years ago and 7.7% now) is getting some badly needed jobs, but will they pay well?

We'll see.  Dreams of an affordable, mass-produced electric car three years from now is one thing, but if it comes at the expense of turning Reno into Silicon Valley with its massive income inequality and obscenly broken housing market, then Tesla's plant needs to be unplugged.

Jury's still out on you, Elon Musk.

The Office, Boxed, In Summer

2014 was, quite frankly, a great summer for some breakthrough films (Guardians of the Galaxy, Maleficent, X-Men: Days of Future Past, Dawn of the Planet of the Apes) but for the industry as a whole, a number of high-profile sequel bombs and World Cup action effectively killed the summer box office.  2014 was the worst summer for tickets since 1997.

The film industry had its worst summer in North America, still the world’s No. 1 movie market, since at least 1997, after adjusting for inflation. Between the first weekend in May through the end of August, ticket sales in the United States and Canada are expected to total roughly $3.9 billion, a 15 percent decline from the same stretch last year, according to Rentrak, a box office data company. 
Analysts in the spring had predicted an 11 percent drop, citing viewing distractions like the World Cup and scuttled release plans for films like “Fast and Furious 6” and Pixar’s “Good Dinosaur,” which both had production problems. But the decline was worse than expected, and the reason, analysts and studio executives said, may have been a nasty case of déjà vu. 
Tom Cruise’s futuristic “Edge of Tomorrow,” for instance, looked like a hit — and that was exactly its problem. The title was too similar to “The Day After Tomorrow,” released in summer 2004. The barren landscape too closely resembled Mr. Cruise’s 2013 film “Oblivion.” Characters walking around in robot exoskeletons? Been there (“Pacific Rim”), done that (“Real Steel”). 
Despite stellar reviews, “Edge of Tomorrow” took in $99.9 million at North American theaters, a major disappointment for Warner Bros., which spent at least $250 million on production and domestic marketing. 
“Hercules,” which arrived seven months after “The Legend of Hercules,” turned out to be a box office weakling. “Sex Tape” was heavily marketed on Cameron Diaz’s legs, but moviegoers shrugged: Sorry, we’ve seen them. “Both ‘Sex Tape’ and ‘A Million Ways to Die in the West’ failed to stand out among the other R-rated comedies,” said Phil Contrino, the chief analyst at
Sameness sells tickets, no doubt about it. The Top 10 movies of the summer all came from familiar brands (Marvel, DreamWorks Animation), featured familiar characters (“Godzilla”) or turned on familiar stories (the raunchy college comedy). Still, only a few of those films truly popped, Mr. Contrino noted, adding that the ones that did “each gave fans something that was unique, fresh and surprising.”

Or maybe for everything awesome like GotG, there's ten crapass movies like Transformers 4: Optimus Prime On A Dinosaur.  I enjoyed Godzilla for instance, but you could have gone the entire summer and just seen Angelina Jolie with wings and Rocket and Groot kicking ass, and you would have been fine.

On the other hand, ticket sales aren't everything, Lucy was terrible, it still made $115 million. Go figure.

Let me know when November rolls around.  Big Hero 6, Interstellar, Dumb and Dumber To, Hunger Games: Mockingjay Part 1, and Penguins of Madagascar all look like good times.

The Cantor Buried Tales: Epilogue

Recently ousted former GOP House Majority leader Eric Cantor certainly landed on his feet after his quasi-shocking primary loss to David Brat in June.  As expected, the welcoming door on Wall Street is wide open to somebody with his "credentials".

Late Monday night it was reported that former House Majority Leader Eric Cantor would take a job at investment bank Moelis
The news has already prompted the predictable eye-rolling about the "revolving door." And to the Tea Partiers who ousted Cantor in a primary earlier this year, the news that he is going to Wall Street is vindication that he was never a populist like them. 
But anyway, Moelis has put in a filing with the SEC, detailing his pay package (Via Erik Schatzker). 

Tell him what he's won, Johnny!

Group LP has agreed to pay Mr. Cantor an annual base salary of $400,000. Group LP has also agreed to pay Mr. Cantor an initial cash amount of $400,000 and grant Mr. Cantor $1,000,000 in initial restricted stock units (“RSUs”), based on the average closing price of the Company’s common stock on the five trading days prior to his start date. The initial RSUs will generally vest in equal installments on each of the third, fourth and fifth anniversaries of his start date. For calendar year 2015, Group LP has agreed to pay Mr. Cantor minimum incentive compensation of $1,200,000 in cash and $400,000 in incentive RSUs, payable in equal quarterly installments. The incentive RSUs will generally have the same vesting schedule as incentive RSUs granted to Group LP’s other Managing Directors.

That adds up to a grand prize package worth $3.4 million, kids.  Not bad for somebody who worked 120 days out of the year, huh?  Plenty of scratch to tide him over should he be thinking about breaking back into politics.  And let's face it, Cantor, like 99% of Republicans (and 80% of Democrats for that matter) is already employed by Wall Street, this just makes it official.

You didn't think he wasn't going to get a multi-million dollar lobbying job, did you?  Much more on this from Esquire's Ben Collins:

One month ago, Eric Cantor was the highest ranking member of the House of Representatives. Now, Eric Cantor is one of those senior executives he railed against, who "created this mess" that is our broken economy and corrupt congress. 
The only political entities Moelis & Company founder Ken Moelis has donated to in 2013 or 2014 are the National Republican Congressional Committee, Eric Cantor, or Eric Cantor’s creatively named PAC, ERICPAC. 
Cantor is now out of office, but he was the highest ranking Republican in the House up until one month and one day ago. This is the rule, not the exception. There is nothing stopping it from happening again, as it is surely happening right this second.

And now he's literally working for one of his biggest campaign donors.

Stop and let that sink in for a second.


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